Categories Employee Engagement Employee Retention Training and Development

As economic uncertainty persists into 2025, many organizations are scrutinizing their budgets, and for some, this means scaling back on training and development. While scaling back might seem like a practical short-term decision, it can lead to long-term challenges that are far more costly than the initial savings.


Although there was a brief dip in training requests we received early in the year, demand has largely returned to normal levels across industries. This suggests that while some organizations are hitting pause amid financial caution, many others recognize the value of ongoing employee development and are choosing to invest in their people, even in uncertain times.



Yes, Budgets Are Tight — but So Is the Talent Market

Recent surveys show that 14% of organizations have decreased their L&D budgets, with more than 70% citing economic concerns. With federal funding for workforce development also being slashed by over $180 million, it’s understandable that businesses are feeling cautious.


But here’s the reality: companies are still struggling to find and keep skilled workers. Training is no longer a luxury — it’s a necessity for filling roles, growing internal talent, and keeping people engaged. In fact, 96% of companies increased their learning budgets in the past year, recognizing that investing in their people is one of the most effective ways to weather uncertainty.



The Hidden Cost of Doing Nothing

When development slows down, so does employee engagement. Teams can become stagnant, communication and leadership gaps widen, and performance suffers as a result. Replacing a disengaged employee costs significantly more than investing in their professional development.


And with the rapid advancement of AI and automation, not reskilling or upskilling your workforce now could leave your organization behind, both competitively and culturally.



Training Doesn’t Have to Break the Bank

You don’t need to invest in massive programs to make an impact. Many companies are finding success by being more strategic, focusing on high-impact skills, leveraging virtual and hybrid formats, and aligning training with business goals. From microlearning to targeted leadership workshops, there are budget-conscious ways to deliver meaningful growth.



Think of It as Retention Insurance

Cutting your L&D budget might save a few dollars now, but it risks losing your best people — and falling short when new demands arise. On the other hand, demonstrating to your team that you’re committed to their growth builds trust, boosts morale, and helps you stay prepared for whatever comes next.


In a year marked by change, investing in your people isn’t just a smart move — it’s a strategic advantage that sets the stage for long-term success.

Categories Training and Development
Overview of the Study and Respondents

The 2024 edition of this long-running industry report by Training Magazine offers one of the most comprehensive snapshots of training trends in the U.S., covering budgets, staffing, and delivery methods. Conducted between April and July 2024, the survey gathered insights from 251 organizations with 100 or more employees, representing a wide range of industries and business sizes. Small companies (100–999 employees) made up 36% of respondents, midsize organizations (1,000–9,999 employees) accounted for 46%, and large enterprises (10,000+ employees) comprised 18%. Participants included a mix of roles, with over half in management positions and many holding influence over training-related purchasing decisions.





  • 62% of respondents help identify training needs




  • 68% recommend purchases, while 18% make final decisions




  • 24% were instructional designers or developers




Spending Trends and Budget Allocations

Overall, U.S. training expenditures fell by 3.7% in 2024 to $98 billion. Payroll costs for training staff dropped 4% to $60.6 billion, though spending on outside products and services rose sharply by 23% to $12.4 billion. While large companies saw the largest budget cuts, midsize companies increased their training investments slightly. On average, companies spent $774 per learner (down from $954 in 2023), and employees received an average of 47 hours of training per year. Top spending priorities included onboarding (13% of budget), compliance, and management training (both at 12%).





  • AI training entered the budget at 4% for the first time




  • Management/supervisory training remains a top funding priority (36%)




  • Companies focused future training goals on improving effectiveness (30%) and increasing usage (22%)




Delivery Methods and Learning Technology Use

Training delivery methods continue to evolve post-COVID. Online and computer-based learning made up 34% of training hours, with virtual classrooms and instructor-led sessions accounting for 27% each. Blended learning use declined to 24%. Mobile, social, and immersive technologies like VR and AR remained limited in adoption. Larger companies showed higher usage of advanced tech such as AI (46%) and VR (22%).





  • 91% used online learning for compliance training




  • Learning management systems (LMS) are used by 90% of companies




  • AI use in training delivery jumped from 9% to 25% in one year




  • In-person learning returned in areas like leadership, onboarding, and soft skills




Outsourcing and Future Outlook

Average spending on outsourced training dropped from $322K in 2023 to $241K in 2024, though it still represented 6% of total training budgets. Large companies spent the most on outsourcing, often relying on external providers for instruction and content development. Most organizations (88%) expect to maintain current outsourcing levels in 2025. While midsize firms are more likely to continue outsourcing, small and large organizations are slightly more inclined to bring functions in-house.





  • 56% outsource instruction/facilitation




  • 27% outsource LMS hosting; 86% keep LMS admin and learner support in-house




  • The most commonly outsourced areas: facilitation, LMS ops, and custom content




  • No major shifts in outsourcing trends expected for 2025