Small businesses lead the way in employee training

Canada’s small businesses spend more per employee on training than larger firms according to the CFIB.

Small businesses lead the way in employee training
The view that small firms invest less in their employees’ training has been challenged by the Canadian Federation of Independent Businesses.

It says that smaller businesses invest on average $2,000 per year on boosting workforce skills while larger counterparts spend $1,713. Almost two thirds of the spending of small and medium businesses is on informal “on-the-job” training, amounting to $9 billion of the $14 billion spent annually by the sector. Ninety-per cent of the businesses polled by the CFIB provide informal training.

“Formal training is important, but there is no substitute for what you learn on the job,” said CFIB president Dan Kelly. “Informal training provides both foundational skills and key industry techniques that simply can’t be learned in a classroom setting. There’s a reason that employers value work experience above almost everything else.”

Training is even more important in the smaller firms than larger ones as hiring of inexperienced workers is 18 per cent of the total compared to 9 per cent for larger entities.

However, although small and medium businesses consider training to be important (85 per cent say that it is their responsibility to train workers) they often see little or no return on their investment. The CFIB analysis found that many employees receive training and then leave.

In recognition of the work that small and medium businesses in Canada do in training the workforce, the CFIB is calling for more help from governments, provincial and federal, in the form of training tax credits. Sixty per cent of small and medium businesses say they would be able to increase training of workers if such a tax break existed.

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