David Smith, Economics Editor at The Sunday Times discusses our latest Big Question – What do finance professionals think about investment in skills and training?
There are few more important issues for Britain’s future than whether as a country we invest enough in skills and training. The future supply of migrant workers may be more limited than in the past, so the need for business to nurture and develop talent has never been greater. This is why skills and training was chosen as the topic for this month’s Big Question.
The results of our survey from a range of organisations in the Reed Accountancy and Finance client network were mainly encouraging, but also offered food for thought. With organisations believing they are investing enough in training, outnumbering those who concede that they are probably not investing enough by two to one (60% to 35%).
Proper training budgets are seen as essential in many businesses. For the recruitment and retention of staff and for keeping up with, or a step ahead, of competitors.
We do believe that training is very important - particularly as we are a company that typically retains staff over long periods - so it’s important not to take our foot off the gas when it comes to training
Julie Grigg - financial controller, RaceTech
Training budgets do, however, come under pressure from other parts of the business, even in firms that believe they are spending adequately in this area. There are also other constraints, which limit the amount of time and effort that can be put into training and skills.
The biggest constraint, cited by 35% of the respondents to the survey, was tight budgets and the need to generate cost savings. This is the significant factor in limiting the push for bigger training budgets. Next were time pressures within the business. It is sometimes forgotten, particularly for those pushing from the outside for businesses to spend more on training, that good training takes up the time of management and existing skilled employees and 29% said this was the main constraint on training.
In a range of other factors limiting the training effort, 24% said they limited training because there is no guarantee that employees will stay with you after you have trained them. This has become an important factor in recent years, with a perceived fall in employee loyalty. Firms hate to see the benefits of an expensive training budget walk out of the door.
Despite this, most firms view training as important, indeed essential. “We invest heavily in training and see it as a massive priority” said Richard Kitt, financial controller of Wilson and Scott Ltd. “We reap the benefits when tendering for new or renewed business.” Carl Henrikksen, managing director of Oryx Align, agreed. “We are a growing company so training is essential to attract and retain the right talent,” he said.
We invest heavily in training and see it as a massive priority
Richard Kitt - financial controller, Wilson and Scott Ltd.
Respondents were asked which should be the priority areas for training, with 26% saying that training on new systems is the most important area and 24% citing new technology.
Perhaps the most interesting responses came to the final question, which was on the purpose of training. Here, most respondents were clear that its purpose should be for the benefit of the organisation. 33% said investment in training should be to improve company efficiency, 24% that improving individual skill sets is the most important part of training, and 20% that staff retention and offering career progression were the key benefits of investment in training.
Only 8%, however, thought training should be about furthering the careers of individuals. As John. R, a financial controller, put it: “Companies don’t employ people for a career, they employ them for a job.” However, most workers will not be unhappy with that, if firms provide the proper training for a job, a good career is likely to be the result.
Find out which skills are most important for different members of your finance team with our interactive tool, State of Skills