L&D leaders and their teams have been on a roller-coaster ride since (at least) 2008 and the Great Recession. When the economy pulls back, training and development are often the first casualties. L&D budgets and staff get cut when short-sighted companies believe learning to be a luxury.
However, just like a roller coaster, once an economy experiences a steep dive there’s a slower, creaking rise to the next peak. The employment outlook is cresting that next peak. As of January 2019, the U.S. unemployment rate stands at 4.0 percent. In fact, unemployment is the lowest it’s been in 30 years. A tight labor market is good news for workers, but it can complicate day-to-day operations for employers. During a tight labor market, employers recall the true value of the learning and development function. There are four major reasons why a tight labor market gives L&D team a chance to showcase their business value.
4 Ways a Tight Labor Market Empowers L&D
Training becomes more urgent. When there is a low supply of available workers, then employers can no longer wait to find the perfect fit to fill an open position. HR and business unit leaders must determine the best available candidate. They must then turn to the expertise of the L&D team and rely on targeted learning to close skills gaps.
Business leaders realize human capital development is critical. Smart organizations realize investment in L&D is a long-term goal with a definite payoff. This investment applies to current employees, but is important as a recruiting tool as well. Potential recruits are attracted by firms willing to invest in skills development. An employer that gains a reputation for investing in talent gains an edge over competitors who fail to make that investment.
Retention becomes a top priority. In a tight labor market, employees have more options. If a job becomes dissatisfying, it becomes easier to leave. Employees desire fulfillment in their work. That fulfillment is often fueled by learning new skills and through personal development. Employees are more apt to stay when they feel these needs are being met.
Measurement matters even more. During tight markets, business leaders appreciate their L&D teams more than ever. However, wise L&D teams know to play offense during these upswings. If your team can measure and communicate the ROI of learning programs, then it can prove its value to the firm. L&D needs to be able to produce data to show their input/impact on the organization is effective. That will benefit your team during any economy, whether its a boom or a bust.
The Business Case for Promoting the Value of L&D
Employers that appreciate the value of the L&D function retain that appreciation consistently, whether there is a tight labor market or not. They realize that success in modern business requires a state of constant learning. A well-trained team can mean the difference between a business that thrives and one that may or may not survive the onslaught of a competitor. Organizations that don’t continually focus on L&D find themselves unprepared to weather economic shifts.
Is your L&D team prepared to address a tight labor market? Does your team possess the instructional design skills needed to increase employee competency? If you want your team to be better prepared, please contact us here at eParamus. We train L&D professionals to master instructional design tools and create measurable learning.