Quick look: A whopping 96% of employees want the opportunity to enhance their skills, yet two-thirds of employers report confusion about how to create a proper learning and development program. From boosting employee retention rates to safeguarding against industry disruptions, here’s how L&D can benefit today’s SMBs, and how working with a PEO can simplify the process.
Learning and development (L&D) programs have traditionally been associated with larger organizations, but these enrichment initiatives are now expected at both big and small employers.
Here, we’ll explore what L&D includes, its many benefits to both employers and employees, and how the help of a professional employer organization (PEO) can simplify the process of rolling out an L&D program.
What does L&D entail?
The Association for Talent Development defines learning and development as “a function within an organization that is responsible for empowering employees’ growth and developing their knowledge, skills, and capabilities to drive better business performance.”
Many types of training fall under this umbrella, including:
- Onboarding and new hire programs
- Career development
- Leadership development programs
- Skills training
- Required courses, like compliance training
- And more
L&D initiatives are often managed by a company’s human resources (HR) department, but their responsibilities may span different business units. Additionally, some organizations leverage a PEO’s assistance with developing an L&D program.
7 ways L&D helps SMB employers
When properly executed, an L&D program can benefit every corner of an organization, from hiring new talent to staying competitive amidst ongoing disruption. Here are seven advantages L&D can offer.
1. Retain employees
The competitive labor market is making companies prioritize hiring new talent and should motivate them to do everything they can to hold on to their valuable staff. This is where an L&D program presents a great opportunity.
According to research firm The Conference Board, approximately 60% of employees are likely to leave their company if they don’t have access to professional development, continuing education, or career training to develop new skills, stay updated on current trends, and drive career advancement. Of all demographics, millennials and people of color are the most willing to leave because of a lack of development opportunities.
Your employees likely desire the chance to learn, and a robust L&D program can give them the opportunity to grow and advance in their careers. And by potentially reducing turnover, it can also help employers avoid the high costs associated with replacing a worker (Glassdoor found that the average US employer spends roughly $4,000 to hire one new employee!).
2. Recruit top talent
There will always be a need to source new workers, and L&D can help in that regard. It’s an employee’s market, and it’s important to understand what today’s job seeker desires.
The American Staffing Association recently revealed that 80% of job candidates consider a potential employer’s professional development and training offerings important when accepting a new job.
Having a comprehensive L&D program and communicating it to job candidates can give small- and medium-sized business (SMB) employers a competitive edge as they grow and require new talent.
3. Strengthen workplace DEI
Focusing on providing employee learning and development opportunities can help drive diversity, equity, and inclusion (DEI) in your organization.
Consider, for example, how important various demographics believe learning opportunities to be. According to the findings from The Conference Board, 80% of Asian respondents, 70% of Hispanic/Latino workers, and 68% of Black employees agreed they would leave their company for another if they didn’t receive their desired development opportunities (compared to 53% of white workers).
The Conference Board also found that 40% of Asian respondents, 38% of Black employees, and 35% of Hispanic/Latino participants reported a lack of career development resources. Similarly, 37% of Black respondents and 36% of both Hispanic/Latino and Asian employees reported a lack of professional development opportunities.
A comprehensive L&D program can help level the playing field and ensure that all employees have access to the professional development resource and opportunities they want.
4. Increase employee engagement
Employee engagement has been making headlines—and for a good reason. Gallup has found that organizations with engaged employees experience:
- 81% less absenteeism
- 18% lower turnover rates in high-turnover organizations
- 43% lower turnover rates in low-turnover organizations
- 23% higher profitability
- 10% increase in customer loyalty/engagement
One of the best ways to engage employees? You guessed it—by offering an L&D program.
Providing the opportunity for employees to grow helps show them that their employers have a genuine interest in their development, which can help them feel more excited about their jobs and more connected to their company.
5. Promote from within
Filling open roles with employees who already reside in your organization has many benefits, like boosting employee motivation, increasing retention levels, and smoother job transition periods.
An L&D plan can help current employees grow their skills and open the door for them to advance within the company. This can help them reach their professional goals while improving company culture and increasing employee retention rates (things that are must-haves for SMB employers now more than ever).
6. Bridge the skills gap
As discussed above, the labor market remains tight, and it’s not an easy time to recruit for the exact skills you need. Leveraging learning and development initiatives to help current workers reskill (learn how to do a new job) or upskill (learn new skills to expand their current role) is what some employers need to fill their skills gaps.
Reskilling and upskilling allow companies to promote from within, spend less on recruiting, and increase employee engagement. And studies show employees want this opportunity to grow their skill set. The Conference Board found that 96% of workers report it’s important or very important for them to develop their skills continuously.
While nearly every employee wants to learn, many don’t know where to start. The University of Phoenix’s Annual Career Optimism Index 2022 reported that roughly half of workers desire to develop their skills but don’t know how to begin. This number rose 6% year-over-year, and 66% of employers feel the same confusion surrounding L&D. This is where partnering with dedicated HR experts at a PEO can provide enormous value.
7. Stay competitive
Knowledge is power—especially in a world where SMBs face nearly constant technology advancements and industry disruptions.
A robust L&D program can help employers stay on the pulse of their industry’s trends and increase their institutional knowledge so that it may not be quite as challenging if/when the business faces a disruption.
This proactive development can also increase company culture and employee engagement as it signals to staff that the organization values learning about new practices and technology.
The right partner for professional development
From boosting engagement and retention to leveling the playing field for all workers, L&D initiatives can significantly impact today’s SMB employers. But despite the wide range of benefits, many employers report facing roadblocks when crafting an L&D program, like:
- Finding time to create/manage the program (42%)
- Lack of employee interest (39%)
- Identifying current skill gaps (38%)
- Budgeting for the training (35%)
PEOs can help solve these pain points and allow businesses to enjoy the advantages that an L&D program can offer. For example, a PEO, like ExtensisHR, has dedicated HR managers who are well-versed in their customer’s business operations and can provide guidance on professional development tactics (among many other things).
ExtensisHR also provides access to its HR Knowledge & Learning Cloud, which features on-demand access to a trusted knowledge base and learning environment to develop your staff’s skill sets and in-house expertise.
If fresh talent is what you need, ExtensisHR offers a wide range of recruiting services (at no additional cost), including:
- Full cycle recruiting for most staff level positions
- Job advertisement creation
- Salary surveys
- Skills assessments
- Interview assistance
- Offer letter consultations
- And more
Lastly, ExtensisHR regularly shares resources dedicated to helping you succeed, including eBooks focused on creating a successful learning and development strategy, the best ways to reskill and upskill your workforce, and more.
Taking advantage of learning and development programs’ perks can be easier than you think. Contact the experts at ExtensisHR to get started today.