Return-on-Investment in Training Workers
Training workers is one of the most common investments a company makes. Beyond the bare calculation of return, this lesson looks at why developing employees tends to pay off and how to get the most from it.
Questions you may have include:
- Why invest in training your workers?
- What returns can you expect?
- How do you maximize the return?
The case for training workers
Well-trained workers are more productive, make fewer mistakes, work more safely, and produce higher-quality results. Training also signals that the company values its people, which improves morale and retention — itself a major saving, since replacing an experienced employee is costly.
“What if they leave?”
Managers sometimes hesitate to train employees who might later leave. The common reply captures the point well: the bigger risk is not training them and having them stay. On balance, skilled, valued employees are both more effective and more likely to remain.
Maximizing the return
Return is highest when training is relevant to the work, when learners can apply it soon after, and when managers reinforce the new skills on the job. Training that is never used quickly fades and returns little.
Summary
Investing in worker training generally pays off through greater productivity, quality, safety, and retention. The return is maximized when the training is relevant, applied promptly, and reinforced at work — and the risk of not developing employees usually outweighs the risk that trained workers will leave.