Do you have a learning strategy for the recession?

That sense of foreboding. Are you feeling it? If you’re in the US, your answer is probably “yes.” We are in a recession. (I know this because the very hot Brian Williams told me so last night…and because I got my quarterly investment summary in the mail which sucked big time and…).

Are you wondering what the impact will be on learning & development?

Let’s look back…

1990s: Jack Gordon wrote an article for Training Magazine (vol. 28. n 10), “Training budgets: recession takes a bite”. Back then, the primary victims of budget cuts were transportation, communications, finance, defense, and utilities. Training budgets took a hit but not any worse than other functions. And, they weren’t hit first as your pessimistic cube mate will suggest. An early 1990s ASTD poll found that while 54% of companies laid off employees, only 20% laid off people in the training department. The results were similar in Training magazine’s own poll. And, the results were similar to those in the late 80s when ‘downsizing’ was everywhere. Of course, technology was not a huge part of T&D. 1991 was the year Tim Berners-Lee wrote an article about the world wide web after all.

What was cut back then?

“Outside” the organization it was seminars, consultants, and vendors’ packaged programs. (Holy cow Batman, is that a dementor behind me? Where’s my patronus?) “Inside” there were hiring freezes and layoffs.

What did companies focus on?

Customer service and quality improvements.

Early 2000s: The technology bust. Remember? While many vendors went belly-up, the ASTD’s State of the Industry report in 2001 said the recession did not provoke an overall cut in training budgets ( “a first”). My personal take on this revolve around two major developments in the early 2000s – the events of 9/11 and exponential technology growth (primarily bandwidth). The events of 9/11 caused a major socio-cultural disruption in society, primarily in the U.S., that influenced nearly every facet of business, including corporate education.

After 9/11, companies needed to train their employees but were hesitant to allow employees to travel and were uncertain about the economy. The time was ripe for e-learning as a way to train large numbers of geographically dispersed employees on everything from terrorism recognition to diversity training. E-learning became a major force for delivering training after 9/11 and has continued to grow and evolve since.

Immediately after 9/11, multiple live face-to-face training events were cancelled. The American Management Association reported an immediate 30 percent drop in enrollment (Caudron, 2002). In contrast, training technology companies – those providing e-learning, videoconferencing, CDs, and satellite-delivered content — were seeing significant increases in business. Videoconferencing minutes at the world’s largest conferencing specialist went up 40 percent in the weeks after the attacks (Caudron, 2002). In short, when it came to using technology to train, the post-9/11 landscape of the corporate training world would change significantly. In fact, there was a 100 percent increase in the percentage of corporate dollars dedicated to e-learning (4.2 percent to 8.5 percent) between 2001 and 2004 (ASTD, 2004), around $11 billion of corporate training funds in 2003 alone (Rouin, 2004).

What did companies focus on?

Technology skills, leadership, customer service, product knowledge.

Let’s look ahead

What are we talking about today in corporate learning (from my vantage point)?

• Group vs. individual focus
• Using Web 2.0 tools and technologies to improve learning (connections, networks, collaboration, interacting with technology, virtual worlds, presence technologies)
• Convergence with talent management
• Dichotomies: Open vs. closed; Pull vs. push, PLE vs. LMS, etc.
• Knowledge Management
• Culture change (control of information, who the experts are)
• Changing roles
• Generational change
• Globalization
• User-generated content
• Free everything
• “New” design considerations – mashups, blending, mobile, “WE,” games
• Teaching how to learn and re-learning how to teach

Frankly, looking at this from a mile high, we don’t seem to working on ways to spend more of the company’s money. We’re in a good place to really make a difference. What are you seeing? Is your budget being cut? Are you anticipating a layoff? And…

Do you have a recession strategy? Or will you use your invisibility cloak to stay off radar?

Other people talking about this…

Michael Hanley
N Dunn
CLO
ankitj @ GQube
Brent Verhaaren
Maya Frost
Elliot Masie
Peter Cohan
Sam Adkins
Clare Kaufman
Timothy F. Bednarz, Ph.D
Shamus McGillicuddy
PersonnelToday

References

Caudron, S. (2002). Training in the post-terrorism era. American Society for Training and Development.

Gordon, Jack. “Training budgets: recession takes a bite. (Special Section) (Cover Story).” Training 28.n10 (Oct 1991): 37(9).

Rouin, R., Fritzsche, B., & Salas, E. (2004). Optimizing e-learning: Research-based guidelines for learner-controlled training. Human Resource Management, 43, 2 & 3, 147-162.

Tagged as: economy