Bringing in new employees undoubtedly costs a lot of time, effort and money. You have to recruit, interview and train. Applicants may not have the experience necessary to do a job with the same level of skill as outgoing employees. More jobs are available now than in recent recession years as well, so employees have more choices about where to work.
As an employer, investing in employees’ career development can help to foster a sense of loyalty, and it can also increase the organization’s attraction to potential employees. The current professional environment requires constant updating of skills and knowledge, and, to stay relevant, employees need – and want — to be trained in the latest best practices and technologies.
Up to 40 percent of people leave their job within the first year, and it can cost many thousands of dollars to replace an employee. Several studies pinpoint this cost at six to nine months’ salary on average. If a software developer making $130,000 per year leaves, his or her former employer could see $65,000 to $95,000 in recruiting and training costs.
As an employer, you want to attract and retain the best talent available. It’s not just about what the company needs in potential employees; the organization has to offer something that employees desire in return. Professional development is a benefit that many individuals want – and expect – from their employers.
The Importance of Investing in Learning
It’s critical for organizations to re-invest in employee development. In a 2012 Harvard Business Review article, researchers wrote that “people who are developing their abilities are likely to believe in their potential for further growth.” You want that growth to stay in your company. You might think that paying for an employee’s skill development will mean they will take what they learn to another company on your dime. In fact, research has shown just the opposite: Employees are more likely to want to stay – and not be absent – when their employers invest in their education.
Budget cuts to education and development may seem necessary in lean times, but keeping those programs is vital to an organization’s sustainability and growth. When companies invest in their talent pool and create a program for career development within the organization, they create an internal group of individuals who are poised to step into key management roles and help the organization succeed.
How to Develop Talent
Employers can tackle employee development in many different ways. One way is to offer individual employee professional development plans that lay out the self-directed learning paths and resources employees can take to learn new skills.
Other companies develop or source customized training programs. For example, a company might upskill their developers on the latest technologies and tie the training directly to company projects. That way, the employees become engaged with the company goals and directives – a win-win for the employees and business.
If you have a large group of workers who are about to retire, training them to update and expand their skills can encourage them to stay with the company longer and/or to share their knowledge with the employees who are coming up through the ranks.
The costs associated with training shouldn’t stop you from developing current employees and attracting new talent. By understanding the needs of your organization, employees and industry, your training department can create development programs that will attract and retain star employees. These programs can include coaching, mentorships, individual development plans, cross-training, stretch assignments and job shadowing.
The Bottom Line
Using your organization’s budget to invest in the training and career development of current and new employees will help increase employee retention by fostering loyalty. It will also improve recruiting outcomes by helping your organization to stand out from other employers who not offer what job seekers want: professional development.