Before cutting training budget, consider the downsides

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It is not unusual during economic contraction for employers to cut their training programs for workers. These reductions are, at best, unwise and, at worst, dangerous.

According to the “Maintenance Evangelist” Joel Leonard, a global advocate for maintenance training, “the postponing of maintenance training costs employers billions of dollars, both in accidents and machinery that is not maintained properly.”

Making the situation worse is the aging maintenance work force; the average age of maintenance workers around the globe is 48. If we do not bring young people into the field, train and retain them, we will simply not function as effectively.

Many of us have already witnessed the effects of this lack of training: machines breaking down and not being fixed for days or weeks and even planes falling out of the sky. Effects of this situation are inconvenience or even death.

Second, if, due to lack of training, we don’t have the depth of bench strength to promote people to higher positions of responsibility (a common situation in Corporate America), we have to hire more experienced people from outside. These more experienced people not only command higher salaries, but often cost more to recruit and take longer to adjust to the culture.

In the logistics industry, not training drivers is very expensive. One fatality crash costs an employer more than $1 million; one two-vehicle injury crash costs $140,500.

Moreover, the transportation industry wastes tens of billions of dollars annually on preventable wrecks that are caused by driver error.

Other research from Ric Newell of Happy Endings, a national driver-training program, reflects that a transportation company can expect an average 10 to 15 preventable wrecks per 100 drivers per year.

Many companies spend tens of thousands of dollars a year paying for preventable wrecks. Every year, companies that depend on their drivers lose substantial profits to avoidable driver mistakes.

“Saving” money by not investing in driver training costs trucking companies and other employers billions of dollars every year.

Our forecast: wise employers will use this time to reinforce and add more bench strength. Employers choosing to reduce training are leaving themselves vulnerable.

From The Herman Trend Alert, by Joyce Gioia-Herman, strategic business futurist.


One Response to Before cutting training budget, consider the downsides

  1. You cannot cut costs when it comes to training. Especialy driver training

    October 3, 2009 at 2:12 pm