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If Employees Can't Climb the Ladder, Training is a Waste

American businesses spend nearly $134 billion on employee development each year — but it could be wasted, new research suggests, if businesses don’t also provide chances to move up the ladder.

Employees feel little compulsion to stay with an employer that provides professional development if they don't see career advancement opportunities, according to a study conducted by the University of Iowa. The study concludes that many training programs actually increase turnover while driving up expenses.

"Most of the training research suggests that investing in employee training and development should help retain employees," Maria Kraimer, associate professor and co-author of the study, told BusinessNewsDaily. "But we found that providing developmental support, such as training opportunities and career mentoring, to employees who do not believe there are attractive career opportunities for them within the company, led to such employees leaving the organization."

It’s critical for businesses to have regular career planning discussions with their employees, Kraimer said.

"Through career-planning discussions, employees have opportunities to both formulate their career goals and share those goals with their supervisors," Kraimer said.

She encourages businesses to inform their employees of all the  positions available to them and even to use job rotations, where employees spend several months in different divisions or units of the company, giving them a taste of each one.

"As part of training and development, make sure employees are aware of the different types of career paths or job opportunities throughout the company," Kraimer said. "Our research showed that job-rotation programs are specific programs that led to employees perceiving greater career opportunities for themselves."

The research will be published later this year in the Journal of Applied Psychology.

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Chad Brooks

Chad Brooks is a Chicago-based writer and editor with nearly 20 years in media. A 1998 journalism graduate of Indiana University, Chad began his career with Business News Daily in 2011 as a freelance writer. In 2014, he joined the staff full time as a senior writer. Before Business News Daily, Chad spent nearly a decade as a staff reporter for the Daily Herald in suburban Chicago, covering a wide array of topics including local and state government, crime, the legal system and education. Chad has also worked on the other side of the media industry, promoting small businesses throughout the United States for two years in a public relations role. His first book, How to Start a Home-Based App Development Business, was published in 2014. He lives with his wife and daughter in the Chicago suburbs.