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Investing in L&D increases retention
DeakinCo. and Deloitte Access Economics’ new report, The business return on learning and development, reveals that average attrition rates are lower for businesses that do well at learning and development.
Shandel McAuliffe
The new report is based on a survey of over 200 Australian business leaders and HR professionals. The business return on learning and development examines L&D in terms of what’s happening now in Australian businesses, how COVID-19 has affected it, what the future might hold, and what organisations can expect to get back from L&D.
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The Australasian Legal Practice Management Association reported in 2021, via their 2021 AU ALPMA Legal Industry HR Issues & Salary Survey Report, that 68 per cent of law firms they surveyed face talent management and employee retention concerns.
A solution for retention may lie with L&D.
Lead partner at Deloitte Legal James Fabijancic commented on: “A positive correlation between L&D and staff retention.”
Mr Fabijancic continued: “The research shows that advanced learning organisations report an average attrition rate of 14 per cent, compared to 25 per cent for laggard organisations.”
He added: “With so many lawyers suffering from burnout and firms experiencing high staff turnover, particularly at the junior levels, L&D could help them retain people while also contributing to better business performance.”
When examining “ROI”, The business return on learning and development states: “L&D is an important strategy for employee management. Many studies have pointed out the importance L&D plays for retaining talent – for instance, 94 per cent of employees say they would stay longer at their company if they invested in their career.”
The report continues: “This benefit has become particularly relevant for Australian businesses, as Australia faces significant skill shortages.”
The positive results of L&D extend beyond retention, according to DeakinCo. and Deloitte Access Economics. And the report cites two key areas that actually came out in front: “The most common benefits of training cited by businesses in the survey include increasing employee productivity (selected by 47 per cent of businesses), upskilling and reskilling staff (44 per cent) and improving employee retention (38 per cent).”
Mr Fabijancic observed: “Leading businesses recognise the benefits that L&D has for increasing employee productivity, upskilling and reskilling.”
And within the context of the legal profession, he added: “Our profession is notorious for relying heavily on manual processes and often inefficient administrative tasks which could be at least partially mitigated through increased investment in L&D.”
DeakinCo. chief executive Glenn Campbell commented: “Skills shortages are here to stay, and Australian businesses need to take action. L&D will help to counteract this challenge – not only by improving employee innovation and productivity, but also by preparing businesses for the future state of work.”
The report also reveals a quantifiable ROI on L&D, asserting that for every $1 a business spends on learning and development (L&D) per employee, they can expect a return of $4.70 in extra revenue per staff member.
Mr Campbell stated: “Until now, measuring L&D performance has been a guessing game for too many businesses. Our research very clearly demonstrates the financial benefits of L&D and we hope businesses can now feel more confident investing in their people knowing that every $1 invested translates to an additional $4.70 in business revenue per employee.”
