The Importance of Staff Training During the Recession Essay

Custom Student Mr. Teacher ENG 1001-04 21 October 2016

The Importance of Staff Training During the Recession

Most industry experts agree that training and development of staff should not be compromised during the recession even though they may be dealing with cuts to budgets and other cost pressures. This is because a well-trained and skilled workforce will be instrumental in supporting organisations during the downturn as well as after economic recovery and growth resumes. Previous recessions and downturns have shown that cutting down on training and skills development for employees only results in a shortage of talented workers come the upturn. This can greatly affect an organisation’s competitiveness. In March, a report from the Boston Consulting Group and the European Association of People Management (EAPM) found that cutting back on training was a popular cost-cutting option but warned that it is the least effective in the longer term. Rudolf Thurner, co-author of the report and president of the EAPM, said: “Companies should evaluate the strategies deployed by HR executives during the last recession. In this way, they can avoid making similar mistakes all over again.”

The shortage of skills in the UK workforce is already evident, according to other studies on the issue. A Randstad-commissioned survey published earlier this year found that almost three-quarters of firms in Britain feel that there is a lack of suitably qualified workers in the country. As a result, half of firms are not planning to cut down on their training budgets, regardless of wider financial conditions. Fred van der Tang, managing director of Randstad UK Professional Services, said: “Many organisations believe they will still be short of key skills to cope with the recession. There will be an increased emphasis on the provision of training for those with the most potential to make sure that key performers are retained.” He added: “In such immensely difficult times, it is encouraging that many human resource heads say their boards want to ensure they do not make inappropriate cuts. Cutting back too heavily was a mistake made by many employers during previous downturns, leaving them poorly prepared for the upturn.”

A recent study by the Chartered Insurance Institute (CII) found that firms in the insurance and financial services sectors are concerned about the level of skills demonstrated by new recruits in the industry. The poll also discovered that many organisations believe that the UK is far behind other countries in workforce skills and must do more if it is to maintain its competitiveness and emerge as a global leader. Daniel Pedley, public affairs manager for the CII, said: “We would certainly advocate not cutting training in times like this. We believe that investing in training now, during a downturn, will help you come up in a better position when the recovery comes. If you invest now you are putting yourself in a much better position for later on down the track.”

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