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Bersin & Associates Study Shows U.K. Corporations Cut Training Budgets and Staff, Gained New Efficiencies in Development and Delivery Methods

Study contains extensive market analysis and guidelines for training and development executives to benchmark their organisations with industry trends in U.K. and U.S.

Oakland, CA, USA – May 13, 2010 – Organisations in the U.K. cut their training and development budgets by 4% and reduced training staff by 5% last year. This is according to a new Bersin & Associates study, The U.K. Training and Development Factbook 2010: Benchmarks, Trends and Analysis of the U.K. Training Market. Companies surveyed spent an average of £621 per learner last year, with an average headcount of 7.1 training staff for every 1,000 learners.

In light of spending and staffing cuts, some companies are turning to a “leaders teaching leaders” model, using internal managers and subject matter experts to teach programmes rather than rely on internal trainers or pay for outside facilitators. In addition, budget cuts have led some U.K. companies to restructure their operations. For example, disparate training groups have been combined into centralized or “shared services” operations, which can help eliminate redundancies in learning programmes and technologies and improve alignment with corporate goals.

According to Josh Bersin, president, the economic recession has impacted training organisations on both sides of the Atlantic, with 11% cutbacks experienced by organisations in the U.S. last year. “While the cuts were steeper in the U.S. last year, the study showed that U.K. organisations are certainly feeling the pinch as well. But we found that some training organisations in the U.K. have used this recession as an opportunity to rethink priorities and find ways to add value – from changing development and delivery methods to restructuring their learning operations to redefining job roles. If training organisations can carry these practices forward, they can emerge in a better position than before the cutbacks.”
Other key findings of the study include:

  • The largest chunk of funding –27% of training budgets in the U.K. – went toward profession and industry-specific training programmes such as professional certifications and other training specific to a job or industry. The second largest area of funding was leadership development, which claimed 23% of total spending.
  • A typical learner in the UK spent approximately 16 hours in formal training in 2009 (compared to 12 hours per learner in the U.S.), with most of that time spent in the classroom. But classroom training carries an enormous amount of overhead, and some organisations in the U.K. are beginning to embrace technology-based training in an effort to reduce costs. While e-learning and virtual classroom training accounted for just 14% of all training hours consumed (companies in the U.S., by comparison, delivered twice as much training through online methods), Bersin & Associates expects use of technology-based delivery methods to increase as financial pressures continue.
  • Informal and social learning approaches are still in their infancy in the U.K. But as organisations realize that most learning takes place outside of the classroom or online course, they are putting in place coaching, experiential and social learning environments.

The research is a companion study to Bersin & Associates’ Corporate Learning Factbook, the firm’s annual research on U.S. corporate training budgets, spending, delivery volumes, staffing, and trends. Data for the U.K. study was collected in November 2009 through a partnership with the Sift Media publication, TrainingZone. The study involved more than 120 training organisations of all sizes and across a wide variety of industries. In addition, Bersin & Associates analysts conducted in-depth phone interviews to identify best practices, many of which are interspersed throughout the study as case-in-point examples.

In addition to facts and statistics on training spending, staffing and programmes, the U.K. Training and Development Factbook 2010 contains extensive market analysis and guidelines for training and development executives to benchmark their organisations and establish key efficiency metrics. These metrics include: expenditures per learner, cost per student hour, budget allocations, staff to learner ratios, payroll costs to total spending, technology costs to total spending, and outsourcing practices.

“Training managers want to know -- particularly in today’s economy -- whether their training investments are on par with similar organisations,” said Karen O’Leonard, principal analyst and author of the study. "This report provides metrics that training managers can use to make decisions about their training investments."

The U.K. Training and Development Factbook 2010 is available at no cost to all Bersin & Associates research members. Non-members can purchase the study for £395. For more details, including an executive summary and a table of contents, click here. A brief audio overview presented by Karen O’Leonard, principal analyst and author of the study, is available here.

Bersin & Associates also offers customized benchmarking for learning organizations that leverages the U.K. Training and Development Factbook 2010 and the firm’s other research. Benchmarking services include defining metrics, developing and executing a benchmarking plan, conducting customized research, and providing data analysis and reporting to key stakeholders. For more details, contact Donna Tomlinson at 561 455 0622 or donna.tomlinson@bersin.com.

About Bersin & Associates

Bersin & Associates is the only research and advisory firm focused solely on research in enterprise learning, talent management, and talent acquisition. The company’s WhatWorks® membership program offers actionable guidance, improves operational effectiveness, and delivers business impact to companies in all industry segments.

Bersin & Associates research members gain access to a comprehensive library of best practices, case studies, benchmarks, and in-depth market analyses designed to assist professionals in making fast and confident decisions. Members also have direct access to analysts and a wide range of tested tools and models to address both strategic and day-to-day challenges.

More than 5,000 organizations worldwide have used Bersin & Associates’ research and advisory services to guide talent and corporate learning strategies. Research areas include planning and strategy, learning programs and delivery, talent management, leadership development and succession planning, talent acquisition, technology and infrastructure, informal learning, social networking, measurement and analytics.

For more information, go to www.bersin.com or call 561 455 0622.