When you’re growing your business, one cost category you’ll need to consider is recruiting, hiring, and training new employees. It can be expensive to recruit new employees, and you may not get a return on that investment if they leave in less than a year. That’s why employee training for your new and existing employees is so important to your business’s bottom line.
Offering regular training for your existing employees makes it less likely that you’ll need to spend more money on recruiting new candidates to replace them.
States and local governments see the value of employee training and its potential to make their region more competitive for employers. As a result, many offer incentives and grants for small businesses to train their workforce. Here’s what you need to get started on your employee training plan.
What skills should be included in employee training?
When you train your employees, it should benefit both the employees and your business. The training should increase your employees’ skills to make your business more competitive and keep up with trends in an evolving business world.
Your training should also give your employees skills that will make them more employable, even if that means making them more attractive to other businesses. Training should teach them skills that allow them to grow in their current position and gain more responsibility in your business.
Here are a few factors to consider as you build your training programs:
Competitiveness: Your business’s competitiveness comes from how effective your staff is at attracting clients and how efficiently they’re doing their work. To get this advantage, your employee training should include updates on the latest regulations, the newest software, or practices for your industry. Anything that will help your employees deliver more on the job than they had before will add to your competitive edge.
Continuity: Like many innovative businesses, yours is likely changing and adapting to the needs and demands of the market. It takes skill to keep up and manage an ever-changing environment, and you want to make sure your employees are prepared for it. For example, during the COVID-19 pandemic many businesses paused their in-person operations and transitioned operations to be exclusively online. Training employees to do their job remotely or using new systems to facilitate online transactions kept businesses open and current with customers’ expectations.
Employability: You might think that offering employee training that makes your staff more employable will encourage them to find new opportunities. But studies show that the opposite actually happens! Making investments in your employees’ transferrable skills can increase retention for your business. These include soft skills, training on the latest technology, teamwork abilities, and communication skills.
Career advancement: Employees are more likely to stay with your business if they see opportunities to advance their careers with you. While you and your managers work on creating a path forward for an employee, take note of the skills the employee will need to advance. This might include employee training on leadership skills, critical thinking, managerial skills, and more advanced software and techniques.
Should employee training be in-house or outsourced?
There are two ways to train employees: in-house with your own internal experts, and through external qualified training providers.
Most employee training incentives available through state governments will pay for qualified external training providers. This is likely because external providers:
- are specialized and can also be qualified by state agencies
- have more trackable costs, which makes them easier to use in applying for training incentives
In-house training is also incredibly valuable, particularly for newly onboarded employees in entry-level positions. Your in-house training should include tutorials on how to do the basic productive tasks of a particular job as well as communication skills.
What state and local incentives are available?
Many states and municipalities offer employee training incentives to give small businesses like yours a boost. Here are a few programs that are available in the Northeast:
New Jersey
There are several employee training incentives in New Jersey that are designed to support employers making investments in their workforce.
The Upskill: New Jersey Incumbent Worker Training program offers grants up to $2,000 per worker for training your employees. That training can be on the job or through an eligible external training provider.
Through the On-The-Job Training (OJT) Program your business can receive a grant for hiring an unemployed jobseeker or public assistance recipient. By agreeing to train the new employee for up to 26 weeks, you’ll receive a grant equal to 50% of that employee’s salary (up to $10,000).
New York
New York’s main incentive to support small businesses with employee training is the Employee Training Incentive Program (ETIP). Your business could receive tax credits for offering training that improves productivity for employees. To qualify, your business needs to make a substantial investment in training your employees to support these goals:
- Create jobs in an economically distressed area
- Fill a worker shortage for an industry
- Recruit women and minority employees into industries where they’re underrepresented
- Keep up with investments in technology to keep businesses competitive
This program is designed to build and maintain industries that have strategic value to the state, so make sure your industry qualifies before you apply!
New York City
NYC has its own training programs that are on par with some of the best programs offered by state governments.
One program the City offers is the Customized Training Program (CTP), a longstanding program offered through NYC Small Business Services. The CTP provides grants from $30,000 to $400,000 to reimburse qualified trainings for ten or more employees at an NYC-based business.
The training can be for new or updated skills, new services or markets, or training on new equipment or software. Rather than providing a tax credit for employee training, this program offers a grant. It also has a broader focus than the state program and is available to more main street businesses like professional services, hospitality, retail, and manufacturing firms.
Pennsylvania
Pennsylvania’s Workforce and Economic Development Network (WEDnetPA) has a similar program to NYC in that it provides grants for qualified employee training programs. However, like the New York State program, it targets specific industries.
The WEDnetPA program supports many different trainings that increase employees’ skills in their current job or in a way that leads to advancement or promotion for them. Training that’s complete outside the workplace also qualifies, and your business can only cover training for full-time employees earning at least $12 per hour.
Employee training is a good investment in your business’s future
Whether you’re training new employees on the basics of their job, or building a future for your current employees with new skills, it’s well worth your time to establish an employee training program for your business. If you need money to get your training program started, talk to Pursuit! We offer more than 15 different business loan programs that can support nearly any business need.
