How Much Does Employee Training Cost?

"I don't know if what I'm spending on employee training is normal."

I hear this all the time from L&D teams. It's hard to translate industry benchmarks into something you can build an L&D budget around.

Benchmarks are trend lines. They show how much companies are investing in training, and whether that number is rising or falling year over year. What they can't tell you is what the right investment looks like at your organization.

That's why I'm going to help you calculate what training costs at your company, so you can compare it against the right benchmark for your size.

What does employee training cost?

According to Training Magazine, companies spent an average of $874 per learner on training in 2025, up from $774 in 2024. Added up, that's about $102.8 billion across the U.S., a 4.9% increase year-over-year.

That benchmark is more nuanced when broken down by company size, measured by number of employees:

This data is collected from U.S.-based organizations and does not include companies with fewer than 100 employees.

Why training costs drop as you scale

If you look at Training Magazine's data, one of the clearest takeaways is that large companies spend less per learner on training than small companies. This year, large companies spent $468 per learner on training compared to small companies that spent $1,091.*

As your company scales, the unit economics (i.e., the cost to train one employee) start to decrease. That's because some costs are fixed. Let's say you have a course created by an instructional designer that's hosted in your LMS. Whether you assign it to 10 or 100 people doesn't impact the cost to create. Plus, the costs for additional seats in your LMS decrease as the volume increases.

The challenge you'll likely face is knowing when the unit economics will flip. If you find yourself in limbo — spending like a small company, but scaling like a large one — your job is to figure out how to reduce training costs.

*Based on the data, smaller companies are getting more efficient with their spend, while large companies' spend has remained relatively flat since 2023.

What should you factor into employee training costs?

Now that you have an appropriate benchmark for training costs, it's time to calculate your employee training costs. That begins by assessing your direct costs, which may include: 

• Content creation and delivery
  ‍Instructional design time, production costs, facilitator or consultant fees
• Tools and platforms
  ‍Tech stack fees, whether for authoring or delivering content
• Travel, facilities, and logistics
  ‍Venue costs, catering, equipment and materials, and any costs L&D owns for facilitators and participants

Then, you'll need to decide whether to include indirect costs, which may include:  

• Employee time in training
  ‍The number of hours employees spend in training multiplied by their fully loaded hourly rate (more on that below)
• Administration and coordination
  ‍The time your team spends on scheduling, communications, and tracking
• SME and manager time
  ‍The time spent reviewing content or reinforcing learning through coaching, feedback, and practice
• Content maintenance
  ‍The ongoing cost of keeping training up-to-date and relevant

No one is expecting you to gather all of these inputs. Even ATD and Training Magazine judiciously select their factors. Feel free to do the same. Just be sure to document your rationale so you can explain your reasoning to Finance or leadership.

How to calculate your employee training costs

Calculating the training cost per employee is simple arithmetic once you have the inputs for total training costs:

Total training cost ÷ number of learners OR total employees = cost per learner OR per employee

Use whichever denominator matches the benchmark you're comparing against — learners if you're benchmarking against Training Magazine, total employees if you're benchmarking against ATD.

Why employee training costs vary so much

Employee training costs vary for two reasons: which inputs you choose to factor into your calculations, and the inputs themselves. For instance, choosing whether to include an indirect cost like employees' time in training will greatly increase the calculated cost of any program.

But inputs themselves can also change, sometimes mid-fiscal year. You could change LMS providers, losing the legacy pricing you had locked in for years, and replacing it with a contract that temporarily surges costs associated with your tech stack. Or a major re-org could be approved, substantively reducing your target audience for a program you've already scoped and designed.

There's only so much you can control when it comes to managing employee training costs, and that's primarily content delivery and design. Training Magazine's 2025 Training Industry Report found 62% of instruction and facilitation is outsourced, and training hours split 34% online, 28% classroom, 24% virtual classroom. Anything developed live, especially by a third party, will add to this variance.

Massive enterprises like Merck know how quickly costs can scale across a global workforce, so they're evolving toward tools like Synthesia that let them train people more efficiently, in-house.

How do you make the case for your training spend?

Once you have a better idea of how much it costs to train your employees, you might be asking yourself whether you can justify this spend. The honest answer is, I don't know. I can't say with certainty how your leadership will react. Surprised? Supportive? Outraged?

That's why you need a compelling business case grounded in measurement data.

I recommend grounding it in workplace research if that would resonate with your stakeholders. You can cite statistics like "organizations with strong learning cultures see 57% higher retention rates" (LinkedIn Workplace Learning Report 2025), but be prepared to make it specific to your organization. If you have low attrition rates and haven't historically invested in L&D, someone might question why you need to start. (Not me, I would never.)

Anticipate this pushback. Even if you have low attrition now, that can change quickly. And the cost of losing a tenured employee is significantly higher than losing someone early in their tenure. Gallup suggests that replacing an employee can cost anywhere from 50% to 200% of their annual salary, and that figure skews higher the more senior the individual.

And remember, be honest. Sometimes you go through this exercise and uncover unnecessary spend that balloons your per-employee costs. Identify it and make a plan to reallocate those resources.