AI investments trigger decreased training budgets
As corporate spending on artificial intelligence mushrooms, fewer dollars are being allocated to learning and development, new research finds.
In a survey of 600 human resources leaders by Careerminds, 82% said AI can replace at least some of the training and coaching the company has previously paid for. Nearly one in six (15.8%) said AI can fully replace such costs.
What’s more, 53.7% of those polled said their company would accept, or has already accepted, slower employee skill development in exchange for greater AI investment. Only a third (34.3%) said no, that would not be acceptable, while 12% weren’t sure.
In response, many employees are taking matters into their own hands. In a companion survey of 600 U.S, workers, Careerminds found that nearly half (47.8%) had paid their own money for upskilling or career development over the past year. An additional 27.3% said they hadn’t yet but planned to in the following 12 months.
These workers spent an average of $788 on their development, and about one in five paid more than $1,000 of their own money. The most common goal of such spending was getting promoted at their current company.
“The same market pressures pushing companies to invest in AI are also raising the bar for what employees need to do to stay employable in a tough job market,” Careerminds wrote. “Workers are being asked to meet a higher standard with less support, leading them to pay for their own development.”
Most of the surveyed HR leaders (79%) said their company’s AI spending increased over the prior year, by an average amount of $88,000. Almost half (42%) raised their AI budgets by $50,000 or more, and about one in five hiked it by more than $100,000.
Perhaps more eye-opening, Gartner has estimated that worldwide spending on AI will total $2.59 trillion in 2026, which would be up a whopping 47% from last year.
At the same time, learning and development are moving in the opposite direction. “Where training budgets were reduced, the cuts were substantial,” the survey report noted, with an average reduction of approximately $126,000.
Almost half (47%) of participants’ companies increased their AI spending at the same time as cutting their learning and development budget.
For Careerminds’ part, the spending trends are not necessarily a positive shift.
“AI is already useful for parts of workplace learning, like delivering content and answering questions on demand,” the survey report observed. “However, when companies invest in training, especially coaching and leadership development, they’re also getting human feedback, honest answers about performance, and guidance that’s shaped around the trainee.”
