Employee development brings a lot of excellent advantages to the table. And developing employees’ skills and knowledge to benefit your business seems like it makes perfect sense when you think about it.
However, many employers seem to have a hard time making the business case for investing in employee development —which is unfortunate, since the process allows employees to reach their full potential and benefits the company as a whole. For instance, providing employee development opportunities to workers provides companies with ways to retain talent, as well as ensures that there are always new people coming in with fresh ideas.
Still, you may still be on the fence as to whether or not you should invest in employee development if you are a CEO or decision-maker. That’s understandable, and we at Matter have listed several compelling benefits of why it’s a good idea to do so. Without further ado, here is a list of our top 20 reasons why you should invest in an employee development plan now.
1. Attracts top talent
Did you know that 38% of millennials say they will leave their current job within the next two years? They do, and if you want access to talented people who are willing and able to facilitate change in your organization, it is likely in your best interest to offer them the tools they need.
2. Improves employee retention
Employee turnover is expensive and can have a negative impact on morale if it happens frequently. When you invest in their development, not only are employees more satisfied with their jobs, but they also tend to stay for longer periods of time.
That’s potentially good news since it costs a company six to nine months of an employee's salary to replace them. For an employee making $60K per year, that comes out to roughly $30K - $45K in recruiting and training costs.
3. Builds an up-and-coming workforce
When you invest in training for employee development, your workers are better equipped to do well and take on more responsibility as time goes by. Whether it's through a formal mentoring program or simply allowing them access to more experience, you are building a workforce that can carry forth your company's legacy.
4. Ensures employees have the right skills
When hiring for an open position, it is imperative to make sure that they have all of the necessary skills required to do their job well. However, if there aren't any other opportunities available within your organization then there is a risk of losing them.
Investing in your employees and their development is beneficial for so many reasons, not least because you can ensure that they have the right skills to do what needs to be done if they stay with your company.
5. Supports staff retention
In addition to increasing employee retention rates as noted above, investing in staff training and talent development has an indirect effect on your ability to retain employees. When you give employees the tools that they need to succeed, there is less of a chance that they will look elsewhere for opportunities or feel underappreciated within their current role.
6. Reduces training costs
One way to offset potential issues with the staff retention outlined above is by offering a strong training program that focuses on employees’ areas of development and gives them what they need to do well. For instance, a study by Deloitte shows that companies who spend more on employee development have lower rates of turnover and higher engagement levels in their staff.
7. Increases employee productivity
It goes without saying that an employee who has all the tools, skills, and training they need will be more productive than one who doesn't. In fact, a report from IBM said that employees in their best-performing organizations are receiving the training they need and performing a full 68% better than their worst-performing ones.
8. Fosters innovation
As noted above, investing in your employees is not only about keeping them happy and satisfied with their jobs but also about creating a legacy of leaders within your organization who are prepared to take on new challenges. This includes the ability to innovate as well as an increased desire for change that can help move businesses forward.
9. Improves employee performance
Very few employees come to work wanting to do a bad job, but low employee satisfaction can be behind them underperforming. That said, a high performance gives them a high level of job satisfaction, and low performance only frustrates them. Well-trained workers function and a higher level and produce quality work. They also keep a positive attitude, which also rubs off on other employees. The result? Well-trained employees that boost the bottom line and bring increased output to your organization.
10. Increases employee engagement
Employees who have the right tools, skills and training to do their job well are more likely to foster employee engagement. Deloitte also reported that engagement is key to retention and has also been associated with improved productivity and reduced downtime.
11. Reduces absenteeism
When employees aren't happy with their jobs, they are more likely to call out sick. This can have a significant impact on operations, including increased costs and reduced productivity. However, when employees feel well trained and confident in what they do, then absenteeism rates drop dramatically.
12. Increases creativity
As noted above, the ability to innovate is crucial for businesses these days whether it is the development of new products/services or improving existing ones. Investing in your employees' skills and training is also one way to foster creativity within your organization which can lead to innovative solutions that may not have otherwise been found.
13. Gives a better reputation
Career development matters to people and organizations that develop their staff are also seen as more desirable places to work. This can be an issue when trying to hire top talent because the organization that invests in its employees is often considered a better place for those looking at long-term employment options.
14. Develops leadership skills
One of the most important things you give promotable employees through training and development is the ability to become better managers. This is because employees who learn how to do their jobs well and work autonomously (i.e., without direction) are also more likely to be able to take on supervisory or management roles in the future. This can also make succession planning easier.
15.Provides better morale
Investing in your employees' development is a win-win for both the organization and its staff. Employees enjoy learning a new skill, and it enables them to hit employee development goals and do their job well. The result: They become much happier with what they do. Also, organizations get an increase in productivity from a workforce that is engaged and satisfied at work.
16. Promotes growth
In addition to an employee's personal growth, greater business growth is experienced by those firms that invest in their employees. For instance, Gallup reported that “organizations that are the best in engaging their employees achieve earnings-per-share growth that is more than four times that of their competitors.”
17.Encourages loyalty through job satisfaction
Although there are many reasons why staff may be satisfied or attached to working for an organization, the one that stands out is when employees feel confident about their skills and abilities to do a good job. When staff are well trained and have the tools they need at work —then this encourages them to stay longer within your company which saves you time and money on recruitment costs.
18. Gives new ideas
When employees are satisfied and engaged in their work, they also have more ideas about how to improve existing processes or introduce new ones. This seed often spreads throughout company culture, and it is also an important step for businesses that want to remain competitive.
19. Provides continuous employee development
The right training method incorporates continuous employee development. It's what happens when individual growth and development never ends, and it's one of the best ways to keep your business competitive.
20. Offsets labor shortages
Perhaps it is a sign of the times, but it is getting harder and harder to attract and retain skilled help. In fact, FedEx recently said that they had to reroute over 600,000 packages per day because they couldn't find enough employees to process them. This shortage is only expected to worsen in 2022 and beyond too.
With so many benefits (and risks if you don't attain it), employee development is no longer something companies and human resource departments can let fall between the cracks.
Now that you know why employee development is important, it's time to think about how you can get started in the workplace. Online education always makes employee development easier to achieve, and one of the best ways to do this is by providing your staff with training courses that are not only geared towards their job but also cover wider skills they need for working in an organization like communication and collaboration, team building or problem-solving.
Also, Matter is now positioned as a free Slack app, where you can give employee recognition through kudos (praise) and constructive feedback. This tool can help with a lot of things on this list, especially when it comes to #16, which is about providing better morale. Matter is free forever for teams of all sizes, and you can upgrade to a pro plan for only $4 for more kudos templates and unlimited personal and team feedback history.
If you liked this article about the many reasons why employee development is important, then be sure to check out our blog for more tips & tricks you can use for your employee development program and ongoing training efforts!