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WHAT IMPACT DOES TRAINING HAVE ON EMPLOYEE COMMITMENT AND

EMPLOYEE TURNOVER?

SCOTT BRUM

University of Rhode Island

Training is of growing importance to companies seeking to gain an advantage among competitors.

There is significant debate among professionals and scholars as to the affect that training has on both

employee and organizational goals. One school of thought argues that training leads to an increase in

turnover while the other states that training is a tool to that can lead to higher levels of employee retention

(Colarelli & Montei, 1996; Becker, 1993). Regardless of where one falls within this debate, most

professionals agree that employee training is a complex human resource practice that can significantly

impact a company’s success.

The training industry as a whole has shown significant growth through the years. Statistics indicate

that investment in training is continuing to grow as more and more companies realize its importance. In

1995, $7.7 billion was spent on the wages and salaries of in-house company trainers and $2.8 billion was

spent on tuition reimbursement (Frazis, Gittleman, Horrigan, Joyce, 1998). The American Society for

Training and Development found that in 2004, the average annual training expenditure per employee was

$955, which is an increase of $135 per employee from the previous year. The number of formal learning

hours per employee also rose from 26 hours in 2003, to 32 hours in 2004 (atsd.com, 2005). As the

investment in various training programs continue to rise, it becomes even more imperative for employers

to understand the impact that training has on their organization.

Training can have a considerable influence

on company finances as there are several

potential training costs that companies may

incur. One type of training related cost is direct

cost. This may include instructor salary,

materials, and follow-up supervision. A second

type of training related cost is indirect cost.

These costs are...