09/03/2022 0 Comments
How to Budget for Employee Training: A Guide
Employee training can cost quite a lot, so how should you start budgeting? Keep reading and learn more about budgeting here.
In a recent study, it was found that 70% of companies offer some form of training for managers and employees. Training is essential for employees as it helps with learning new technologies, customer strategies, and selling techniques. Now, you may be wondering, with all this training, how can a company manage its cost?
Don’t worry, with this guide you can find out! From how much it costs to ways to save, you can learn how to budget for training programs today!
Are you ready to get started? Here’s a quick look at employee training.
How Much Does Training Cost?
For many small businesses, investing $500 to $1000 per employee is just too much money to simply spend on training. However, you shouldn’t eliminate training entirely from your company.
A training budget helps you focus on what skills your employees need to learn and acquire. By starting a budget, you’ll only pay for the items you need; that way, you don’t overspend or pay for items that are unnecessary.
Creating a Training Budget
When you start budgeting for training costs, don’t use extra money when it’s available. Instead, you’ll want to build a training budget into your business.
To calculate an individual employee's annual training budget, allocate an amount equal to anywhere from 1 to 5 percent of the staff member's yearly salary towards training. For example, a business may choose to invest 5 percent of an individual's salary towards professional development training.
You’ll want to separate a line item for training into your annual budget. Your training budget should include costs like:
- The instructor fee
- Training materials (if applicable)
- Staff time
Once it’s approved, it needs to be managed by HR so the budget can stay on track. Now, occasionally, there may be extra costs due to unplanned events such as employees leaving or employees taking vacations.
However, keep in mind that understanding your cost revenue structure will help you manage your budget. After all, when you take a calculated look at your training program, you can determine what your company needs and how to afford it. So, make sure training and employee development activities are worked into your organization’s financial and strategic plan.
How to Save Money
Now, due to the size of your staff, you may find that training costs add up quickly. So, to save some money, you can do the following:
- Group Training: you can earn discounts by training multiple employees at once. At Coursetter we even offer customized training programs that meet your exact needs.
- Reuse Materials: training materials such as workbooks, videos, and textbooks can be used repeatedly due to their long shelf-life
- Online Learning: remote online training materials are often more affordable than instructor-based classes
Start an Employee Training Program Today
If you’d like to learn more about creating a customized or online employee training program for your staff, don’t hesitate to contact us today. Check out our business course catalogue to learn more. We look forward to helping you!