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Cheap on Training

Dear Dave,
I’m an HR director for a 200-person engineering firm. Our principals are very reluctant to spend any money when it comes to staff training. Feels like I have to arm wrestle them to spend a dollar on anything at all. The frequently expressed reasons by the principal for this include a feeling that professionals should be responsible for their own professional development. Why should the company have to pay for it? Or, we’re too busy to afford the time away from project workload demands. Or, if we invest in training people they’ll just be poached away by other area firms who can afford to pay them more, since we’ve already incurred the expense to train them up. I think they believe all these reasons, but I also think they are just plain cheap. How can I get them to free up some resources for staff development?

Dear HU,
It does not make it right, but statistically many firms share the same mindset as yours when it comes to spending for training. According to a recent industry survey, the overall median annual expenditure for training and education at AE firms of all types and sizes works out to about $461 per total staff. As the median figure, half the firms spend more per person, half the firms spend less. This amount includes the out-of-pocket cost for tuition reimbursement, educational programs, and educational materials and expenses, including travel cost to educational programs. This figure does not include the salary cost for the time of staff to attend training sessions. When you figure the median annual salary cost of all AE firm employees, according to the same survey, works out to just over $56,000 per year, the non-payroll training cost amounts to far less than 1% of salaries. For a knowledge-based business such as ours, sure seems like we are not spending much as a profession compared to all other expenses incurred to run a firm.

My personal belief is that it is shortsighted not to invest in staff development. Sure, some might leave to accept better positions once trained, but many more will stay because you’ve created an environment in which they do feel they are learning and developing as professionals. In my experience, a reason some firms experience high turn-over is because staff feels they have no more opportunities to grow and develop within their current firms and need to look outside their current firms to keep developing. It’s important to morale to keep professionals at the “edge of their competency” as much as you can with a steady diet of stimulating, challenging work. People (and companies) grow by operating at their margins, not by staying in their comfort zones. A commitment to training equips people to take on these new challenges. Take the tact with your principals that training and development actually saves money in the long run by reducing turnover, creating a more talented and enthused group of professionals, and offering a better value proposition to market to your clients over firms who do not.


Wahby and Associates