Training Industry, Trends, Share, contribution, change management, Market share, Report.

1. A B O U T T H I S S T U D Y
16 | NOVEMBER/DECEMBER 2014 training
REPORT
INDUSTRY
2O14 TRAINING
Now in its 33rd year, The Industry Report
is recognized as the training industry’s
most trusted source of data on budgets,
staffing, and programs. This year, the
study was conducted by an outside
research firm May-July 2014, when
members from the Training magazine
database were e-mailed an invitation
to participate in an online survey. Only
U.S.-based corporations and educational
institutions with 100 or more employees
were included in the analysis. Agencies of
the state, local, and federal government
were not included in the analysis.
The data represents a cross-section of
industries and company sizes.
SURVEY RESPONDENTS
Small companies 28%
(100-999 employees)
Midsize 41%
(1,000-9,999 employees)
Large 31%
(10,000 or more employees)
Total respondents 998
Note that the figures in this report
are weighted by company size and
industry according to a Dun Bradstreet
database available through Hoovers of
U.S. companies. Since small companies
dominate the U.S. market, in terms of
sheer numbers, these organizations receive
a heavier weighting, so that the data
accurately reflects the U.S. market.
www.trainingmag.com
About Survey Respondents:
Industrial Classifications
Respondent profile by industry (weighted per Dun Bradstreet).
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2. T R A I N I N G E X P E N D I T U R E S
training NOVEMBER/DECEMBER 2014 | 17
Backed by an improving job
market, a sharper focus on
training to close skill gaps, and
activity leading to more mid-
size companies, total 2014 U.S.
training expenditures—including
payroll and spending on external
products and services—jumped
outside products and services rose
The training budget figure
was calculated by projecting
the average training budget to a
weighted universe of companies,
using a Dun Bradstreet database
available through Hoovers of U.S.
organizations with more than 100
employees. It is interesting to note
that although small companies
have the smallest annual budgets,
there are so many of them that they
budget for training expenditures.
Total training spending: All training-related expenditures for the year,
including training budgets, technology spending, and staff salaries.
Training staff payroll: The annual payroll for all staff personnel assigned
to the training function.
Outside products and services: Annual spending on external vendors
and consultants, including all products, services, technologies, off-the-
shelf and custom content, and consulting services.
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0
10
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Training Expenditures 2009-2014
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DEFINITIONS
Average of Total Annual Budget
Organization Type Large Midsize Small Average
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3. 2014 TRAINING INDUSTRY REPORT
T R A I N I N G E X P E N D I T U R E S
18 | NOVEMBER/DECEMBER 2014 training www.trainingmag.com
Average training expenditures for large companies decreased
from the year before (up from 34 percent in 2013), while
percent in 2013. Large nonprofits and service organizations
had the largest personnel costs. Across all organization
types, larger companies spent about 10 times as much as
midsize, and midsize companies spent about three times
as much as small ones. The average payroll figure for large
For those who reported an increase in their training staff,
the average increase was four people, five less than in 2013.
For those who reported a decrease in their staff, the average
average, organizations spent 11 percent of their budget
education organizations spent the highest portion of their
budgets on tools and technology (24 percent and 21
percent, respectively). Manufacturers across all sizes spent
the greatest percentage of their budgets on training tools.
0 10 20 30 40 50
19%
6%
18%
37%
21%
23%
33%
20%
29%
27%
11%
8%
20%
15%
41%
23%
44%
17%
27%
18%
13%
7%
3%
Assessment Analysis Testing
Audience Response Systems
Business Skills
Enterprise Learning Systems
Games Simulations
Learning Management Systems
Mobile Learning
Online Learning Tools Systems
Talent Management Tools Systems
Training Management Administration
Translation Localization
Types of Training Products and Services
Intended to Purchase Next Year

4. training NOVEMBER/DECEMBER 2014 | 19www.trainingmag.com
0 300 600 900 1,200 1,500
$976
$1,059
$881
$1,238
$1,092
$1,115
$829
$819
$1,104
$490
$903
$864
0 10 20 30 40 50
40.7
37.5
42.2
36.5
41.6
38.8
36.2
37.5
organizations spent the smallest percentage of their training
budget on tools and technologies (1 percent and 4 percent,
purchases are online learning tools and systems (44 percent
year), classroom tools and systems (33 percent vs. 29
percent), and content development (29 percent vs. 30
percent last year).
Manufacturers spent the most this year with an average
organizations have lost their edge on cost savings as midsize
per year, three hours more than last year. In general, small
companies tended to have more hours of training this year at
wholesale organizations having the largest number of hours
expenditures to training non-exempt employees (40 percent,
down from 42 percent in 2013). Training for exempt non-
2014.
All Companies
Small (100 to 999
employees)
Midsize (1,000 to
9,999 employees)
Large (10,000 or
more employees)
All Companies
Small (100 to 999
employees)
Midsize (1,000 to
9,999 employees)
Large (10,000 or
more employees)
Training Expenditures per Learner 2012-2014
Hours of Training per Employee 2013-2014

5. 2014 TRAINING INDUSTRY REPORT
T R A I N I N G E X P E N D I T U R E S
0
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Training Expenditure Allocations—
Who Gets Trained?
Is the Number of
Training-Related Staff Higher
or Lower Than Last Year?
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6. T R A I N I N G B U D G E T
www.trainingmag.com
0 20 40 60 80 100
9%
60%
31%
13%
42%
45%
13%
65%
22%
25%
42%
33%
28%
11%
61%
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22%
100%
31%
47%
www.trainingmag.com
Budget status was almost evenly split,
with 43 percent saying their training
budget increased and 41 percent
percent reported a decrease in budget.
Last year, 41 percent said their budget
military organizations showed the
greatest tendency for training budget
the largest gains. Increases were not
evenly distributed across organization
sizes. Large companies (23 percent)
showed more decreases than midsize
(14 percent) and small (13 percent)
companies.
Most of the budget increases were
organizations reported increases in the
who reported an increase in their
training budgets attributed it to the
following reasons:
percent last year)
vs. 49 percent and 40 percent,
respectively last year)
percent last year)
Like last year, the majority (42
percent) of respondents reported budget
Some 44 percent chose “other” as
the reason for the decrease, citing
“corporate mandate to cut expenses,”
“LMS implemented,” “lowered priority
by the organization,” and “Training
department reorganized,” among others.
This was followed by:
Services
Education
Association
Nonprofit
Budget Change by Industry
What Happened to Your
Training Budget This Year?
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7. T R A I N I N G B U D G E T S
2014 TRAINING INDUSTRY REPORT
0 10 20 30 40 50
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www.trainingmag.com22 | NOVEMBER/DECEMBER 2014 training

8. www.trainingmag.com
How Much Did Your Training Budget Decrease?
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Decreased Number of Learners Served
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training NOVEMBER/DECEMBER 2014 | 23
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0 10 20 30 40
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9. 0 20 40 60 80 100
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26% 60% 6% 8%
20% 60% 7% 13%
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20% 58% 6% 16%
16% 38 3% 43%
15% 72% 5% 8%
14% 63% 4% 19%
19% 63% 4% 14%
0 30 60 90 120 150
2014 TRAINING INDUSTRY REPORT
T R A I N I N G B U D G E T S
T R A I N I N G D E L I V E RY
www.trainingmag.com
Nearly 47 percent of training hours were delivered by a
stand-and-deliver instructor in a classroom setting—up a bit
from the 44 percent reported last year.
year.
they are using social learning to some extent.
companies continue to rely on instructor-led delivery
Blended learning was fairly even across companies of all
appeared to be focusing on online or computer-based
Executive Development
Management/Supervisory Training
Customer Service Training
Sales Training
Mandatory or Compliance Training
Onboarding
Projected Funding for Learning Areas Next Year
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Small
Midsize
Large
Training Delivery Methods by Company Size 2014
24 | NOVEMBER/DECEMBER 2014 training

14. T R A I N I N G D E L I V E RY
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0 20 40 60 80 100
methods (35.9 percent vs. an average of 26.5 percent for
small and midsize companies).
Mandatory or compliance training continued to be done
mostly online, with 72 percent of organizations doing at
least some of it online and 20 percent entirely online (down
from 21 percent last year). Online training also often is used
for desktop application training (56 percent, the same as last
year) and IT/systems application training (54 percent, down
from 58 percent last year). Online training was least used for
executive development (40 percent had no online training for
it), onboarding (35 percent had no online training for it), and
interpersonal skills and customer service (31 percent had no
online training for either one). Of the learning technologies
presented, the most often used included:
learning management systems (LMSs), both with 74
percent. Last year, virtual held the lead at 78 percent,
followed by LMSs with 74 percent.
last year)
percent)
The delivery methods least often used for training remained
the same as last year:
percent (down from 26 percent)
management system at 21 percent (down from 25 percent)
Management/Supervisory Training
Interpersonal Skills (e.g., communication)
IT/Systems Training (e.g., enterprise software)
Sales Training
Onboarding
Online Method Use for Types of Training
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15. 2014 TRAINING INDUSTRY REPORT
T R A I N I N G D E L I V E RY
www.trainingmag.com
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Application Simulation Tool
Virtual Classroom/Webcasting/Video Broadcasting
Learning Content Management System (LCMS)
Learning Management System (LMS)
Mobile Applications
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16. T R A I N I N G O U T S O U R C I N G
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0 20 40 60 80 100
2014 saw a sizeable increase in the average expenditure
was spent on outsourcing in 2014, the same as in 2013.
On average, 29 percent of companies completely
year). Learner support, however, was mostly handled in-
was handled in-house, as well.
house and outsourced. Across all the topic areas, large
companies outsourced more than midsize ones, and midsize
organizations outsourced more than small companies. This
organizations.
The level of outsourcing is expected to stay relatively steady
to stay the same in the outsourcing area. The percentage
of companies expecting to decrease use (11 percent) is
slightly higher than those expecting to use outsourcing more
though. In learner support, twice as many companies said
they will be doing less than those that said they will be
doing more.
There aren’t many differences between the outsourcing
changes by company size. One thing that stands out:
Large companies will outsource less custom content
development.
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17. 2014 TRAINING INDUSTRY REPORT
T R A I N I N G O U T S O U R C I N G
www.trainingmag.com
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0 20 40 60 80 100
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28 | NOVEMBER/DECEMBER 2014 training

18. www.trainingmag.com
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training NOVEMBER/DECEMBER 2014 | 29