The Importance of Employee Development in the Workplace

Ten Thousand Coffees Team -
June 5, 2023

Almost all leaders will agree on the importance of employee development in the workplace. Yet, when it comes to implementing a meaningful employee development strategy, many organizations fall short. 

Nearly 50% of employees aren’t happy with their employer’s learning and development programs. And even 44% of HR leaders don’t think their organization offers compelling career paths.

But here’s the real question. Does it matter?

Spoiler alert: It absolutely does. When done right, employee development is an underutilized strategy that can make or break an organization in more ways than one. 

Table of Contents 

  1. The importance of employee development
  2. The impact of career development 
  3. Talent development metrics to track
  4. Understanding talent development ROI
  5. Creating a culture of employee development
  6. The importance of employee development FAQs

The importance of employee development

You might remember a time where the news cycle was full of stories around quiet quitting or how employees are stealing company time. In fact, you’ll still see those today. If you didn’t know any better, it’s easy to believe that employees are just trying to get away with the bare minimum. 

But the truth is, the vast majority of employees are looking for opportunities to grow and make a meaningful contribution—both in their current roles and throughout their careers. 

How? Enter employee development. 

Employee development is when workers gain new skills to help them advance in their careers and support your business goals. You may also know it as career development. 

When you think about employee learning and development, you might think of autonomous training videos and lengthy learning modules. While those do play a role, professional development is much more than that.

From opportunities for internal mobility, career pathing, mentorship, and learning, every organization has unique resources they can leverage to help employees grow in their careers—within the organization and beyond. 

But employee development isn’t just about helping your team carve out a future career path. When employees are better (and happier) at their jobs, it reflects in their work, your customer experience, and ultimately your organization’s bottom line. 

As enterprise organizations face labor shortages and a rapidly changing work landscape, prioritizing employee development is a must in order to keep up with the future of work.

Career development statistics

Professional development is important for employees to thrive in their roles. Employee performance trickles down into your organization’s strategic growth, employee retention, and the overall well-being of your workforce.

But don’t just take our word for it. Here are 4 powerful stats that show just how important employee development really is to your team.

1. Nearly 100% of employees say career-related skills development is important

A 2022 survey by The Conference Board reported that 96 percent of respondents believe that it’s important or very important for them to continuously develop their work-related skills. Yet…

2. Only 26% of employees say their organization challenged them to learn a new skill

According to the 2023 LinkedIn Workplace Learning Report, only about 1-in-4 employees say they were challenged to learn by their organization. 

Even when learning and development are available, 42% of intermediate and junior staff said they struggle with "boring and unengaging training”. This creates a massive number of employees left to navigate their own learning journeys or simply search for better opportunities elsewhere.

3. 41% of employees quit their jobs due to a lack of career development

According to the Guild’s American Worker Survey report, of those who quit their previous job from April 2021 to April 2022, 41% did so because of a lack of career development and advancement opportunities. Making career development one of the top reasons employees leave their employers.

4. 70% of frontline employees have applied for career advancement opportunities

Desire for career growth isn’t exclusive to mid to senior-level employees. Even junior or entry-level employees want to make progress. A McKinsey survey of 2,100 frontline employees found that over 70% of employees have applied to career advancement opportunities internally or externally. 

The impact of career development 

It’s obvious that employees care about their own development and future. But the benefits aren’t one-sided. Investing in professional development opportunities for your team can translate into better business outcomes, including better productivity and profitability.

Let’s dive a bit deeper into the different ways that career development impacts an organization.

1. Improves employee retention

Employers in the US spend not millions or billions, but rather trillions of dollars every year fighting employee turnover. So it’s no surprise that 93% of organizations are concerned about employee retention.

You’ll hear a lot about flexible work environments, compensation, and other perks that play a role in keeping employees in the door. But most folks simply want to feel valued and do better in their jobs. They want to make a meaningful impact, even if it means taking the time to learn something new. 

But in turn, employees expect the same level of commitment to their own growth from their employers. So if they feel like there’s no room for advancement, they’re likely to look for a new job elsewhere. Realistically, if investing in employee development isn’t a priority, you’re going to struggle to attract top talent to fill those vacant roles as well.

Investing in employee development is a time and resource commitment, but when replacing an employee costs as much as 3-4x the position’s salary, it’s usually worth it to retain your top performers.

2. Drives employee engagement

Employee engagement is a measure of how enthusiastic and connected your employees are to their work and your organization. It’s a metric that impacts everything from job satisfaction to employee turnover. According to Gallup, organizations with engaged employees experience 17% higher productivity and 21% higher profitability.

You want your employees to come to work with a positive attitude. But the responsibility can’t just fall squarely on their shoulders.

By providing upskilling and development opportunities, you can help your team feel more confident in their work. The feeling of accomplishment can unlock a sense of pride and ownership. And when your employees feel like you’re on the same team, they’ll be more motivated to deliver positive results and align themselves with your company goals.

3. Build employee satisfaction

It’s no secret that employee job satisfaction has been a bit touch and go over the last few years. From mass layoffs to major organizational shifts, it’s not entirely surprising that employees are feeling a little burnt out.

Giving an already-tired team more learning tasks and development to-dos might sound counterintuitive. But career development is extremely underrated when it comes to employee happiness.

Employees who feel supported in their roles through mentorship, coaching, and other growth opportunities, are usually happier and more loyal to their jobs. In fact, employees who spend more than 5 hours a week learning are almost 50% less likely to be stressed and 23% more likely to take on additional responsibilities.

 4. Increases employee (and business) performance

Investing in career and employee development empowers your team to reach their full potential. Employees who are constantly learning are more likely to stay up-to-date on the latest trends and sharpen the skills they need to do their jobs.

And when employees are good at their jobs, your business benefits. 

70/20/10 Learning Model: Employee development isn’t limited to training programs. Only 10% of learning tends to come from formal training. The rest comes from new on-the-job experiences (70%) and interactions with others (20%). Organizations can boost employee performance by offering solutions for building connections and creating informal learning opportunities in their day-to-day.

5. Supports strategic planning

Long-term strategic planning should always include talent management. This includes putting plans in place for filling future (and current) skills gaps and creating an internal talent pipeline so you have the resources in place to achieve your business goals.

With rapidly changing technology and job hopping becoming the norm, planning your talent pipeline becomes even more critical. With 87% of organizations admitting they are experiencing skills gaps or expect to in the next 5 years. This doesn’t just apply to private enterprises. Similar talent gap challenges exist even in the public sector.

Strategically implementing employee development is one of the best ways for you to future-proof your talent pool. Identifying and upskilling high-potential talent creates a steady pipeline of future senior leaders. Meanwhile, investing in early talent means that you’ll nurture a loyal workforce that is more likely to stick around.

6. Scales revenue and profitability

They say you need to spend money to earn money—and that holds true for employee development. Investing in your employees’ growth and learning can pay off in spades.

If you look at all the areas that are impacted by career development—from employee engagement to employee retention and beyond, everything comes together to help your organization save money and be more efficient.

For example, engaged employees are more productive and creative. They’ll get more done in the same time or less, so you’re paying the same for more output and higher-quality work.

Or when you upskill your employees, you’ll have a strong talent pipeline for future roles. On average, it’s 1.7x more expensive to hire and onboard external candidates than internal ones. If you have several roles to fill, those costs can really add up, making internal mobility extremely cost-effective.

Understanding talent development ROI

We all know impactful employee development requires a lot of time and resources—if it didn’t, every company would be doing it. So it’s important to know that your efforts aren’t in vain. 

Think about it. No enterprise would invest thousands of dollars in ads and not expect to track the results. Employee development should be treated the same way. It arguably has an equal (if not bigger) impact on your overall business strategy.

But tracking talent development ROI can get a little murky. There are a lot of moving pieces. And unfortunately, there’s no exact dollar-in-dollar-out formula that can accurately compare your expenses and return.

However, that doesn’t mean you shouldn’t be collecting data points that can help you build your talent development success story. 

When looking at talent development ROI, you generally want to compare your expenses (or investment) with the value of benefits you’ve received.

Calculating talent development ROI
% ROI = (Value of benefits - Expenses) / Expenses

Your expenses will typically include (but aren’t limited to):

  • Cost of software or tools
  • Labor and human resources required to administer any programs
  • Time taken away from employees' core responsibilities to focus on development

The benefits can look like (but aren’t limited to):

  • Revenue associated with increased productivity
  • Additional earnings from increased customer satisfaction
  • Savings from reduced employee turnover 


But measuring employee development doesn’t end with ROI. There are also other metrics you should be tracking to make sure your career development strategy is making a positive impact.

Talent development metrics to track

Investing in career development is good. But tracking your employee development with data is better. 

Here are some KPIs and metrics that can help ensure your talent development is headed in the right direction.

  • Internal mobility rates: This is the percentage of employees who have moved into different roles within your organization. It doesn’t always have to be promotions. Even lateral moves can be a positive sign of employee development.
  • Learning/development participation rates: If you have mentorship programs or other career development initiatives, the percentage of your employees who participate can be a sign of effectiveness.
  • Employee performance: The metrics used to measure employee performance will vary depending on the role. However, better productivity, higher customer satisfaction, or an increase in targets being hit are all ways to gauge improved performance.
  • Employee retention rates: If the percentage of employees who stay with the company over a period of time is increasing, that’s a positive indication of successful employee development. Alternatively, you can look for a decrease in employee turnover rates.
  • Employee engagement and satisfaction rates: This is a measure of how happy your employees are in their roles. This can be measured by a survey or even qualitative employee feedback.

It’s important to look at these metrics regularly. But the size of your business can impact how quickly you can get significant results. It’s common for organizations to track results quarterly, bi-annually, or annually.

If you’re kicking off a major talent development program or campaign, a before and after snapshot can also help make sure you’re headed in the right direction.

Creating a culture of employee development

Successful organizations need to invest in employee development. But it shouldn’t (and can’t) just be a one-off initiative. For employee development to stick, it needs to be ingrained in your company culture. 

When the entire organization believes in learning and development, it’s woven into your daily operations. The result? A community-driven approach where employees of all levels are empowered to take ownership of their own growth while supporting others.

When everyone is invested in development, the benefits are crystal clear. You get a team of happier, more engaged employees—and you’ll have talent development metrics to prove it.

Learn how Ten Thousand Coffee’s community-driven career development platform can level up your employee development experience. Schedule a demo today.

The importance of employee development FAQs

Why is career development important?

Employee and career development is important for businesses because it creates a more skilled, engaged, and productive workforce. In turn, organizations are able to retain top talent and enjoy better business outcomes, including higher profitability.

What is the impact of career development on a business?

Career development can impact the success of a business in many ways, including:

  • Lower employee turnover and better retention rates
  • Increased employee engagement rates
  • Higher rates of employee satisfaction
  • Better performance among teams
  • A stronger talent pipeline
  • Increased revenue and earnings

What are some talent development metrics that businesses can track?

Businesses can look at many metrics when it comes to talent development including (but not limited to):

  • Talent development ROI
  • Employee engagement rates
  • Employee satisfaction rates
  • Employee retention rates
  • Overall employee performance 
  • Internal mobility rates
  • Learning and development program participation rates

Keeping a close eye on talent development metrics can help businesses understand areas of opportunity and track progress when it comes to employee growth.

Webinar

The Importance of Employee Development in the Workplace

Almost all leaders will agree on the importance of employee development in the workplace. Yet, when it comes to implementing a meaningful employee development strategy, many organizations fall short. 

Nearly 50% of employees aren’t happy with their employer’s learning and development programs. And even 44% of HR leaders don’t think their organization offers compelling career paths.

But here’s the real question. Does it matter?

Spoiler alert: It absolutely does. When done right, employee development is an underutilized strategy that can make or break an organization in more ways than one. 

Table of Contents 

  1. The importance of employee development
  2. The impact of career development 
  3. Talent development metrics to track
  4. Understanding talent development ROI
  5. Creating a culture of employee development
  6. The importance of employee development FAQs

The importance of employee development

You might remember a time where the news cycle was full of stories around quiet quitting or how employees are stealing company time. In fact, you’ll still see those today. If you didn’t know any better, it’s easy to believe that employees are just trying to get away with the bare minimum. 

But the truth is, the vast majority of employees are looking for opportunities to grow and make a meaningful contribution—both in their current roles and throughout their careers. 

How? Enter employee development. 

Employee development is when workers gain new skills to help them advance in their careers and support your business goals. You may also know it as career development. 

When you think about employee learning and development, you might think of autonomous training videos and lengthy learning modules. While those do play a role, professional development is much more than that.

From opportunities for internal mobility, career pathing, mentorship, and learning, every organization has unique resources they can leverage to help employees grow in their careers—within the organization and beyond. 

But employee development isn’t just about helping your team carve out a future career path. When employees are better (and happier) at their jobs, it reflects in their work, your customer experience, and ultimately your organization’s bottom line. 

As enterprise organizations face labor shortages and a rapidly changing work landscape, prioritizing employee development is a must in order to keep up with the future of work.

Career development statistics

Professional development is important for employees to thrive in their roles. Employee performance trickles down into your organization’s strategic growth, employee retention, and the overall well-being of your workforce.

But don’t just take our word for it. Here are 4 powerful stats that show just how important employee development really is to your team.

1. Nearly 100% of employees say career-related skills development is important

A 2022 survey by The Conference Board reported that 96 percent of respondents believe that it’s important or very important for them to continuously develop their work-related skills. Yet…

2. Only 26% of employees say their organization challenged them to learn a new skill

According to the 2023 LinkedIn Workplace Learning Report, only about 1-in-4 employees say they were challenged to learn by their organization. 

Even when learning and development are available, 42% of intermediate and junior staff said they struggle with "boring and unengaging training”. This creates a massive number of employees left to navigate their own learning journeys or simply search for better opportunities elsewhere.

3. 41% of employees quit their jobs due to a lack of career development

According to the Guild’s American Worker Survey report, of those who quit their previous job from April 2021 to April 2022, 41% did so because of a lack of career development and advancement opportunities. Making career development one of the top reasons employees leave their employers.

4. 70% of frontline employees have applied for career advancement opportunities

Desire for career growth isn’t exclusive to mid to senior-level employees. Even junior or entry-level employees want to make progress. A McKinsey survey of 2,100 frontline employees found that over 70% of employees have applied to career advancement opportunities internally or externally. 

The impact of career development 

It’s obvious that employees care about their own development and future. But the benefits aren’t one-sided. Investing in professional development opportunities for your team can translate into better business outcomes, including better productivity and profitability.

Let’s dive a bit deeper into the different ways that career development impacts an organization.

1. Improves employee retention

Employers in the US spend not millions or billions, but rather trillions of dollars every year fighting employee turnover. So it’s no surprise that 93% of organizations are concerned about employee retention.

You’ll hear a lot about flexible work environments, compensation, and other perks that play a role in keeping employees in the door. But most folks simply want to feel valued and do better in their jobs. They want to make a meaningful impact, even if it means taking the time to learn something new. 

But in turn, employees expect the same level of commitment to their own growth from their employers. So if they feel like there’s no room for advancement, they’re likely to look for a new job elsewhere. Realistically, if investing in employee development isn’t a priority, you’re going to struggle to attract top talent to fill those vacant roles as well.

Investing in employee development is a time and resource commitment, but when replacing an employee costs as much as 3-4x the position’s salary, it’s usually worth it to retain your top performers.

2. Drives employee engagement

Employee engagement is a measure of how enthusiastic and connected your employees are to their work and your organization. It’s a metric that impacts everything from job satisfaction to employee turnover. According to Gallup, organizations with engaged employees experience 17% higher productivity and 21% higher profitability.

You want your employees to come to work with a positive attitude. But the responsibility can’t just fall squarely on their shoulders.

By providing upskilling and development opportunities, you can help your team feel more confident in their work. The feeling of accomplishment can unlock a sense of pride and ownership. And when your employees feel like you’re on the same team, they’ll be more motivated to deliver positive results and align themselves with your company goals.

3. Build employee satisfaction

It’s no secret that employee job satisfaction has been a bit touch and go over the last few years. From mass layoffs to major organizational shifts, it’s not entirely surprising that employees are feeling a little burnt out.

Giving an already-tired team more learning tasks and development to-dos might sound counterintuitive. But career development is extremely underrated when it comes to employee happiness.

Employees who feel supported in their roles through mentorship, coaching, and other growth opportunities, are usually happier and more loyal to their jobs. In fact, employees who spend more than 5 hours a week learning are almost 50% less likely to be stressed and 23% more likely to take on additional responsibilities.

 4. Increases employee (and business) performance

Investing in career and employee development empowers your team to reach their full potential. Employees who are constantly learning are more likely to stay up-to-date on the latest trends and sharpen the skills they need to do their jobs.

And when employees are good at their jobs, your business benefits. 

70/20/10 Learning Model: Employee development isn’t limited to training programs. Only 10% of learning tends to come from formal training. The rest comes from new on-the-job experiences (70%) and interactions with others (20%). Organizations can boost employee performance by offering solutions for building connections and creating informal learning opportunities in their day-to-day.

5. Supports strategic planning

Long-term strategic planning should always include talent management. This includes putting plans in place for filling future (and current) skills gaps and creating an internal talent pipeline so you have the resources in place to achieve your business goals.

With rapidly changing technology and job hopping becoming the norm, planning your talent pipeline becomes even more critical. With 87% of organizations admitting they are experiencing skills gaps or expect to in the next 5 years. This doesn’t just apply to private enterprises. Similar talent gap challenges exist even in the public sector.

Strategically implementing employee development is one of the best ways for you to future-proof your talent pool. Identifying and upskilling high-potential talent creates a steady pipeline of future senior leaders. Meanwhile, investing in early talent means that you’ll nurture a loyal workforce that is more likely to stick around.

6. Scales revenue and profitability

They say you need to spend money to earn money—and that holds true for employee development. Investing in your employees’ growth and learning can pay off in spades.

If you look at all the areas that are impacted by career development—from employee engagement to employee retention and beyond, everything comes together to help your organization save money and be more efficient.

For example, engaged employees are more productive and creative. They’ll get more done in the same time or less, so you’re paying the same for more output and higher-quality work.

Or when you upskill your employees, you’ll have a strong talent pipeline for future roles. On average, it’s 1.7x more expensive to hire and onboard external candidates than internal ones. If you have several roles to fill, those costs can really add up, making internal mobility extremely cost-effective.

Understanding talent development ROI

We all know impactful employee development requires a lot of time and resources—if it didn’t, every company would be doing it. So it’s important to know that your efforts aren’t in vain. 

Think about it. No enterprise would invest thousands of dollars in ads and not expect to track the results. Employee development should be treated the same way. It arguably has an equal (if not bigger) impact on your overall business strategy.

But tracking talent development ROI can get a little murky. There are a lot of moving pieces. And unfortunately, there’s no exact dollar-in-dollar-out formula that can accurately compare your expenses and return.

However, that doesn’t mean you shouldn’t be collecting data points that can help you build your talent development success story. 

When looking at talent development ROI, you generally want to compare your expenses (or investment) with the value of benefits you’ve received.

Calculating talent development ROI
% ROI = (Value of benefits - Expenses) / Expenses

Your expenses will typically include (but aren’t limited to):

  • Cost of software or tools
  • Labor and human resources required to administer any programs
  • Time taken away from employees' core responsibilities to focus on development

The benefits can look like (but aren’t limited to):

  • Revenue associated with increased productivity
  • Additional earnings from increased customer satisfaction
  • Savings from reduced employee turnover 


But measuring employee development doesn’t end with ROI. There are also other metrics you should be tracking to make sure your career development strategy is making a positive impact.

Talent development metrics to track

Investing in career development is good. But tracking your employee development with data is better. 

Here are some KPIs and metrics that can help ensure your talent development is headed in the right direction.

  • Internal mobility rates: This is the percentage of employees who have moved into different roles within your organization. It doesn’t always have to be promotions. Even lateral moves can be a positive sign of employee development.
  • Learning/development participation rates: If you have mentorship programs or other career development initiatives, the percentage of your employees who participate can be a sign of effectiveness.
  • Employee performance: The metrics used to measure employee performance will vary depending on the role. However, better productivity, higher customer satisfaction, or an increase in targets being hit are all ways to gauge improved performance.
  • Employee retention rates: If the percentage of employees who stay with the company over a period of time is increasing, that’s a positive indication of successful employee development. Alternatively, you can look for a decrease in employee turnover rates.
  • Employee engagement and satisfaction rates: This is a measure of how happy your employees are in their roles. This can be measured by a survey or even qualitative employee feedback.

It’s important to look at these metrics regularly. But the size of your business can impact how quickly you can get significant results. It’s common for organizations to track results quarterly, bi-annually, or annually.

If you’re kicking off a major talent development program or campaign, a before and after snapshot can also help make sure you’re headed in the right direction.

Creating a culture of employee development

Successful organizations need to invest in employee development. But it shouldn’t (and can’t) just be a one-off initiative. For employee development to stick, it needs to be ingrained in your company culture. 

When the entire organization believes in learning and development, it’s woven into your daily operations. The result? A community-driven approach where employees of all levels are empowered to take ownership of their own growth while supporting others.

When everyone is invested in development, the benefits are crystal clear. You get a team of happier, more engaged employees—and you’ll have talent development metrics to prove it.

Learn how Ten Thousand Coffee’s community-driven career development platform can level up your employee development experience. Schedule a demo today.

The importance of employee development FAQs

Why is career development important?

Employee and career development is important for businesses because it creates a more skilled, engaged, and productive workforce. In turn, organizations are able to retain top talent and enjoy better business outcomes, including higher profitability.

What is the impact of career development on a business?

Career development can impact the success of a business in many ways, including:

  • Lower employee turnover and better retention rates
  • Increased employee engagement rates
  • Higher rates of employee satisfaction
  • Better performance among teams
  • A stronger talent pipeline
  • Increased revenue and earnings

What are some talent development metrics that businesses can track?

Businesses can look at many metrics when it comes to talent development including (but not limited to):

  • Talent development ROI
  • Employee engagement rates
  • Employee satisfaction rates
  • Employee retention rates
  • Overall employee performance 
  • Internal mobility rates
  • Learning and development program participation rates

Keeping a close eye on talent development metrics can help businesses understand areas of opportunity and track progress when it comes to employee growth.

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