Training in Smaller Firms

A report by the British Small Business Council(SBC) showed that Britain has a relatively poor labor productivity and loweconomic performance due to a low skills base. UK governments have sought waysto increase training by UK firms. Training, learning, and development are keycomponents in the employment relationship. Firms offering training to staff aremore likely to attract and retain workers and be more productive. Smaller firmshave been found to provide less training than larger firms. A number of critical issues are identified that limit smaller firms'engaging in training and development--i.e., lack of time, inadequate finance,and ignorance of the benefits and available schemes. Smaller firms rely on moreinformal approaches to training than larger firms and are more skeptical offormal training and its benefits. The informal nature of training makes itsdocumentation and analysis difficult, making it difficult to develop policiesand structures. The literature on training in small firms in the UK is reviewed with thegoal of offering policy suggestions for improving the take-up of training bysmaller firms. Relevant issues discussed include motivations and barriers thatexist for training; the role and importance of informal and formal practices;the influence of size, sector, and structure; and implications of these issuesfor policy. Efforts must encourage informal training and its reputationrelative to formal training. A more inclusive approach to the design,implementation, and support of training, and dividing training initiative byfirm type and employee may offer a better set of UK government policies.(TNM)