{"id":18041,"date":"2022-06-20T17:04:26","date_gmt":"2022-06-20T14:04:26","guid":{"rendered":"https:\/\/www.talentlms.com\/blog\/?p=18041"},"modified":"2025-01-15T15:20:48","modified_gmt":"2025-01-15T13:20:48","slug":"investing-in-training","status":"publish","type":"post","link":"https:\/\/www.talentlms.com\/blog\/investing-in-training\/","title":{"rendered":"Investing in training: Where do companies spend their L&D budget?"},"content":{"rendered":"

You put a lot of work into preparing your L&D budget. From tracking KPIs to following trends to forecasting business needs, it\u2019s an active process that requires data and insight. But budgeting isn\u2019t just a one-off event you do to kick off your year.<\/p>\n

Priorities change and trends evolve, and you need the flexibility to keep up. Budgeting wisely<\/strong><\/a> means re-evaluating regularly to ensure you\u2019re making the best use of your resources. And mid-year is a good time to revisit your spending and decide whether to make adjustments as you prepare for future investments.<\/p>\n

It\u2019s a heavy task, but you don’t have to prepare a new L&D budget from scratch. You just need to know where to focus<\/strong> and how to look for areas for improvement<\/strong>. In this article, we\u2019ll talk about how the pandemic affected training budgets and priorities. We\u2019ll also discuss how you can help senior leadership understand the importance of investing in employee development. Finally, we\u2019ll cover current L&D trends and how you should prioritize spending for 2022.<\/p>\n

Training budgets amidst the pandemic<\/h2>\n

Research we conducted in partnership with the Society for Human Resources Management (SHRM) at the end of last year reveals how the pandemic shifted priorities and how that impacted L&D budgets.<\/p>\n

The majority of HR leaders (57%) say their L&D budgets increased<\/strong><\/a> following the outbreak of the pandemic. And an even higher percentage (67%) said they planned to raise their budgets for 2022. Clearly, employee development has been a priority.<\/p>\n

So how did companies put their extra budget to use during this time of transition? Here are two significant investments they made.<\/p>\n

1. Virtual and online learning solutions<\/h3>\n

Despite the initial decline in L&D spending<\/a> as companies were forced to abandon traditional in-person training, the demand for digital solutions increased. Companies began investing in online platforms to train their remote learners.<\/p>\n

The pandemic sped up the digital transformation already at play in training. As the dust settled from the initial switch to remote work, HR professionals began planning ways to fit training into this new work model.<\/p>\n

At the end of 2020, 79% of L&D pros<\/a> reported that they planned to spend more money on online learning going forward, while 73% said they\u2019d spend less on traditional instructor-led training. Money was earmarked for online learning solutions, including cloud-based platforms<\/strong><\/a> and self-paced training modules.<\/p>\n

2. Urgent skills and knowledge needs<\/h3>\n

Many organizations decided to continue with work-from-home and hybrid work models after the initial move to remote work. The new arrangements presented an immediate need for training people to thrive in these new work environments.<\/p>\n

For example, companies are now investing in cloud tools and need to train their teams on how to use them. Or, they double down on soft skills training<\/strong><\/a> so people can better communicate even from afar.<\/p>\n

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Why you should think of training as an investment<\/h2>\n

Many companies increased their L&D budgets during the pandemic, but 52% of HR managers still report facing resistance<\/strong><\/a> when seeking budget approval. Despite increased support for L&D, leadership in many organizations still hesitates when it comes to funding.<\/p>\n

The problem, according to 54% of the HR professionals surveyed, stems from the fact that leadership sees L&D as a cost and not as an investment<\/strong>.<\/p>\n

If you face resistance in your organization, consider sharing the following reasons funding employee development is in your best interest.<\/p>\n