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Training budgets will rise by 8% this year, claims survey

UK organisations will spend an average of 8 per cent more on training in 2004, according to a new survey.

Blended learning publisher Balance Learning asked 94 training professionals about their corporate training budgets and how the money will be spent over the next 12 months.

According to the results, 46% of organisations will increase their training budgets in 2004. The majority (51%) will see an increase of up to 5% but 21% of organisations will increase their budgets by over 25%. One third will keep budget levels the same as 2003 and 16% will cut their budgets this year. 5% have yet to confirm their plans.

Chris Horseman, Managing Director of Balance Learning, said: "The data suggests that organisations appreciate the value of training and that 2004 will be a very busy year for training departments and training providers. Taking into account the planned increases and decreases, we calculate that training budgets overall will rise by 8.14%. This figure should provide a useful reference point for benchmarking in the industry."

The financial services and retail sectors will benefit most from training budget increases. They respectively account for a third and a fifth of all increases over 20%.

Of those organisations which are increasing their budgets, 67% plan to spend more on blended learning solutions, defined as the combination of two or more learning methods. 53% will spend more on e-learning and 47% will increase instructor-led training.

Organisations look set to enhance their in-house training capabilities. 77% plan to increase the amount of training they develop and provide internally. 47% also state that they will be buying-in more training resources from third party suppliers.

In those organisations where budgets are being cut, 47% are making only small reductions of up to 2.5%. 26% will cut budgets by 7.5%-15% this year, with just 1% cutting budgets by over 25%. Telecommunications appears to be the hardest-hit sector, with two thirds of telecoms companies planning to make cuts of over 10%. Local government organisations will also cut their training budgets
by an average of 2%.

46% of those organisations which are cutting budgets will reduce the amount of classroom training they provide. However 87% will increase their proportionate spend on e-learning and 53% will spend more on blended learning solutions in 2004.

"Where budget cuts are being made, it is face-to-face classroom training that's the biggest casualty," said Chris Horseman. "More organisations are allocating proportionately more budget to e-learning and blended learning, which are seen as more cost effective options."

About the survey

94 training professionals took part in the survey during January 2004. The sample group comprised training specialists from diverse organisations including the financial services, retail, government, education, healthcare, IT and telecoms sectors.

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