MARKHAM, ON, June 4, 2012 – With increased demands placed on today’s workforce and the constant need to adapt core skillsets, training and development has become top of mind for many business owners. Investing in employee growth has evolved from a consideration to a vital attraction and retention tool with 80 per cent of new hires expecting training and development as a condition of employment.
The quarterly American Express Small Business Monitor reveals nine in ten (92%) small business owners believe well trained employees are the key to a company’s success. However, over half of small business owners (61%) say the average member of today’s workforce doesn’t have enough of the skills or knowledge their company needs to succeed.
“Strong talent is the cornerstone of a successful business, and as such, business owners are taking the necessary steps to continue to invest in their human capital,” says Athena Varmazis, Vice President and General Manager, Small Business Services, American Express Canada. “With the needs of the skilled workforce constantly evolving, employers are feeling an increased pressure to keep pace with their training and development programs.”
SBOs address skills gap to stay competitive
Business owners understand the importance of investing in ongoing training and development, and are willing to prioritize this investment if it translates to an increase in their bottom line. Their primary motivation for investing in staff training and development opportunities is to make the company more competitive (36%); to retain quality staff (26%); and to keep up with new technology (14%).
In the past two years SBOs reported job-specific technical skills (52%) was their primary source of training followed closely by company specific knowledge/skills (49%) and sales (34%). Of these, 67 per cent of SBOs reported company specific knowledge/skills training as providing the highest return on investment.
“Gaining a competitive advantage appears to be the greatest motivator for small business owners investing in training and development,” says Varmazis. “As such, they are placing a greater emphasis in this area when evaluating annual budgets as they are seeing a viable ROI.”
Twenty-nine per cent of SBOs reported training and development takes budgetary priority over most strategic and operational initiatives. On average, small businesses spend eight per cent of revenue on training and development and expect to nearly double spending during the coming years (average increase of 7.5 per cent over the next two years).
SBOs want employees to take proactive role in their growth
SBOs understand the importance of implementing training and development into their businesses, yet they feel employees should play a larger role in obtaining an advanced skill set. While the majority (83%) of SBOs said their employees embrace training and development opportunities they are given, (78%) of SBOs feel their employees need to take more responsibility for their own development.
“While employees seem receptive to training programs overall, business owners are looking for more involvement from their staff in shaping their own development,” says Varmazis. “They feel employees could be taking more initiative by either seeking out their own programs or bringing suggestions to the company.”
While employees could be more proactive, 78 per cent of SBOs do report their staff use the skills learned and in fact, almost three quarters (74%) of SBOs reported their employees want more training and development. However, busy schedules seem to be a challenge, with nearly half (43%) of employees citing they don’t have enough time for more training.
Willingness to take risks continues to rise amongst Canadian SBOs
In terms of the quarterly index portion of the survey, the Monitor reveals SBOs are showing a stronger willingness to invest in order to grow their business. Thirty-eight per cent say they are willing to take above average or significant risks in business over the next six months, up 16 points since April 2011 (22%).
Furthermore, Canada’s small businesses remain increasingly hopeful about future revenue growth, profitability and their overall financial state; more than half (60%) of SBOs report their business’s current financial position is improving – up 27 points since April 2011. And the vast majority (90%) remain confident their business will grow over the next six months.
“Businesses continue to show signs of confidence and as a result are feeling more enabled to take risks to grow their business,” says Varmazis. “Now, more than ever, business owners are looking to the future.”
About the American Express Small Business Monitor
From April 4-25, 2012, Rogers Connect Market Research conducted an online survey on behalf of American Express Small Business Services with a sample of 500 Canadian small business owners each employing between 2 and 100 people. The margin of error for the total sample is +/- 4.3%, 19 times out of 20. In order to ensure the results are representative of the entire population of small business owners in Canada, the data have been statistically weighted for small business by region according to Statistics Canada. Respondents were located across Canada and came from a variety of industries, including health, social services, education, tech, sales and skilled trades. Due to rounding, some results may add to over 100 per cent.
About American Express Small Business Services
American Express Small Business Services (SBS) is dedicated exclusively to the success of small business owners and their companies. SBS supports business owners with exceptional service. We offer tailored products and services that deliver purchasing power, flexibility, control and rewards to help customers run their business. Specifically, business owners can leverage an enhanced set of products, tools, services and savings, including charge and credit cards, robust online account management capabilities and savings on business services from an expanded line-up of partners. To obtain more information about SBS, visit www.amexforbusiness.ca