Category: HR KPIs.

As you probably already know, simply hiring someone may not be enough to boost the performance of a certain department of your company. In this case, you definitely have to rely on training – however, training does not come for free nor can it be performed by some of your company’s employees.

If you want to implement a training or development program, you’ll have to come up with a strategy and look for the right trainers to adhere to your strategy as well. Therefore, today we’ll be talking about the Training Cost Per Employee metric and about how it influences your company’s staff.

Things to Take into Account

In order for the successful onboarding of your new employees, you will have to invest a lot of money and time as well. Training does not happen overnight; nor can you call them in the office during weekends for a training session.

Employees might have just the right skill set you are looking for – however, they still need to be informed about the responsibilities they’ll have to tend to as soon as they start working in your company.

According to a study, back in 2016, the average cost for training an employee was of around $1,200 – by now, we can expect that cost to have increased a bit as the requirements to fill in a certain position have increased in numbers, given the advancements in technology and such.

Moreover, according to the same study, it was determined that employees took around 34 training hours on average in order to gain the required knowledge and skills for their job – as we previously mentioned, both money and time are required for onboarding an employee.

Size of Your Business

The formula for calculating the Training Cost per Employee is very simple – just divide the training budget by the number of employees you have to train. However, there are certain things you have to take into account in order to determine if the Training Cost per Employee fits your company.

First of all, the Training Cost per Employee depends on the size of your business – and it’s a fact that small businesses usually spend more on training than some of the large corporations out there.

This is because large corporations can bring in and train a lot of employees, therefore sharing the costs between them – on the other hand, a small business will have fewer employees that need training and, therefore, spend more per employee training.


The Training Cost per Employee is also heavily influenced by the industry your company activates in. For example, an IT company may spend money to teach employees just basics things that they should know.

However, a company that specializes in engineering and working with machines will have to teach its employees everything they need to know about a certain department or machine they may come in contact with.

You also have to take into account each employee’s skill sets, the training method you wish to implement, the equipment that’s going to be used, as well as the potential productivity loss.

The Bottom Line

Speaking of productivity loss, when calculating your Training Cost per Employee, you might want to take into consideration the following variables as well – the training equipment and materials you are going to use, the payment for lecturers/ trainers, and the loss of productivity, such as the salaries that you are going to pay to your employees during training.

All the aforementioned are added to the Training Budget of your company, which can increase or decrease depending on the training means you rely on.

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