The Other Payoff

Training & Development, March, 2001 by Donna J. Abernathy

A recent study provides definitive evidence that training investments can yield financial returns for companies and their investors.

An ASTD research white paper--"Profiting From Learning: Do Firms' Investments in Education and Training Pay Off?"--claims that organizational training investment data helps to predict a firm's future total stockholder return, gross profit margin, and income per employee, among other financial performance measures. The report, produced in conjunction with Saba, goes on to say that investors may be able to improve their stock portfolio performance if they consider firms' training expenditures when making investment decisions.

According to ASTD director of research Mark Van Buren, "It's clear that firms' training expenditures positively affect other indicators that investors use to evaluate stocks." He adds that both companies and investors can benefit by tracking and reporting training expenditures.