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How much do companies spend on new hire orientation? (Please include examples of this spending from simple things like HR expenses for filling out documents to "Deloitte University", a program put on by Deloitte to train its new hires.) As many data points as possible would be great. Thank you!
Hello! Thanks for asking how much money companies spend on new hire orientations. The short version is that corporate training has increased to more than $70 billion in the United States and $130 billion in the world. Recently, the issue of improving employee careers and transforming corporate learning has taken center stage. It has emerged as the second most important trend in Deloitte's 2017 Global Human Capital Trends survey. Spending varies by industry, but according to the ATD’s State of the Industry Report, the average annual expenditure for an employee is $1,229. Below you will find a deep dive of my findings.
STATISTICS RELATED TO NEW HIRE TRAINING
Forbes reported that US spending with respect to corporate training has increased to more than $70 billion in the United States and $130 billion in the world. Spending on outside products and services went down 6% this year from $8 billion to $7.5 billion, and other training expenses like travel, equipment, and facilities went down to $26.1 billion from $28.7 billion. U.S. companies on average budget 8-10% of their total employee spend on training.
Recently, the issue of improving employee careers and transforming corporate learning has taken center stage. It has emerged as the second most important trend in Deloitte's 2017 Global Human Capital Trends survey. Today, a career is a journey of learning. Constant learning is important for business success in the present age. Data from Glassdoor states that millennials see the ability to learn and progress as the main factor of a company's employment brand. Forty-two percent of millennials say that they are likely to leave their current position because they are not learning enough at their jobs.
TRAINING BUDGETS VARY BY INDUSTRY
Spending varies by industry, but according to the ATD’s State of the Industry Report, the average annual expenditure for an employee is $1,229. The average training budget for large companies (10,000 employees or more) is $13 million. For midsize companies ( 1,000 to 9,999 employees) this is $3.7 million. For small companies (under 1,000 employees) this is $290 thousand.
Educational organizations have an average total annual budget of $742, 400. Government and military organizations have a budget of $5,562,409. Manufacturers and distributors have a budget of $5,043,103. The service industry had a budget of $4,657,747. Nonprofits had a budget of $1,232,174.
TYPES OF TRAINING
Companies are offering employees 32.4 hours of learning per year. Most learning occurs in instructor-led classrooms (50%) and online self-paced programs (19%). The top five areas of learning content are managerial and supervisory training; profession or industry specific training; mandatory or compliance training; processes, procedures, and business practice training; and new employee orientation.
E-learning is the most expensive learning experience to produce, and video learning is the least expensive. However, e-learning is used 28% more often. It takes 106 hours to produce an e-learning course, and 60 hours to develop an instructional video. Companies also spend more of their training budget on senior leadership and less on lower employee levels. Most of the training budget for senior leadership (58%) is greater than a thousand dollars. The greater portion of mid-level management training (38%) is between $500 and $999. For supervisors the largest portion of the training (33%) was between $100 and $499.
According to the 2016 Training Industry Report, the types of training products and services projected to be purchased in the next few months are learning management systems (40%), online learning tools and systems (35%), and authoring tools and systems (31%). For the year 2016, employees in small companies spent 49.6 hours of training. Employees in midsize companies spent 43.5 hours of training, and employees in large companies spent 33.0 hours of training. In 2016, onboard training was done 12% of the time mostly online, 27% of the time with some online programs, and 30% of the time with no online programs.
KPMG AND BMW
The Orlando Sentinel states that KPMG is looking to build a training facility and conference center in the city. It will be a $430 million, 800,000 square-foot campus--larger and more expensive than Deloitte University's $300 million, 700,000 square feet campus. It could bring 80 jobs to Orlando with an average pay of $66,000 per job. KPMG says Dallas and Atlanta are also being considered. The campus will include 800 guest rooms, fitness and outdoor recreational spaces, and several food and beverage venues. KPMG executives from across the country will meet at this campus for extended training. In 2016, the BMW Group spent more than 350 million euros in vocational and professional training for employees. BMW is also training more than 4,600 young people. They say these programs reflect their company’s sense of responsibility about the future.
CONCLUSION
To wrap it up, corporate training has increased to more than $70 billion in the United States and $130 billion in the world. Recently, the issue of improving employee careers and transforming corporate learning has taken center stage. It has emerged as the second most important trend in Deloitte's 2017 Global Human Capital Trends survey. Spending varies by industry, but according to the ATD’s State of the Industry Report, the average annual expenditure for an employee is $1,229. Thanks for using Wonder! Please let us know if we can help with anything else!