“Investment in human capital, that is, in education and skills training, is three times as important to economic growth as investment in physical capital, such as machinery and equipment. This implies that investments in raising the average level of skill could yield large economic returns,” claims Statistics Canada. Yet the Organization for Economic Co-operation and Development reports that less than 30% of adult workers in Canada participate in job-related education compared with 45% in the U.S. And the Conference Board of Canada states that U.S. firms spend about 50% more in training and professional development per employee than Canadian companies.
It is no surprise that Canada’s economic performance has slipped in recent years. Attention is now being paid to the lower level of investment in skills and training. According to the Canadian Council on Learning, “It is estimated at least five million adult Canadians will require skills upgrading if Canadian businesses are to keep up with, and get ahead of, our global competitors.” Between 1991 and 2003 the number of high-knowledge businesses increased by 78% and the number of low knowledge firms decreased by 3%.
Why don’t we train more?
Many employers fear that once an employee has the added allure of training then they will be poached away, although studies have shown the opposite scenario to be the case, if the employee has been appreciated for their new skills. The biggest reason for not investing in training seems to be the intangible, poorly measured return on investment (ROI). Many studies are now being done in this area globally, and the results are consistent: training leads to increased productivity and wages.