U.S. companies spent $51.3 billion on employee training in 2003, down 6% from the previous year, according to the 2003 U.S. Training Industry Study, conducted by Training magazine. It’s just the fourth time in the last 22 years that training spending declined, and it marks the first time since 1982 that training spending dropped two years in a row.

The economy is the overriding reason for the cuts. The combination of widespread layoffs and hiring freezes has reduced the American workforce, thus, the need to train new employees. About $3 billion less was spent on training for non-exempt, entry-level employees.

Companies are also choosing more inexpensive online training methods over classroom training. In 2003, 69% of courses featured instructor-led classroom training, compared to 74% in 2002 and 77% in 2001. Computer-based training jumped to 26% in 2003, up from 19% in 2002 and 16% in 2001.

Manufacturing, hospitality, and retail were among the industries hardest hit, while training sessions in the health care industry flourished. In terms of content, sales, customer service, leadership, and ethics courses were the most popular.

For more, see the special Training section in the January issue of Corporate Meetings & Incentives.