Companies are ploughing more money into leadership development, with people and performance management skills being key areas of investment.

A study of 250 UK training buyers found that 42% reported an increase in their management training budget (up from 30% in 2003) with only 12% facing a reduction (22% the previous year).

This was confirmed by expectations for 2005 where 25% expected further increases in their budgets and only 6% expected a reduction.

Cambridge Online Learning, who conducted the study, said the main reasons for the growth were that companies had more people to train and more training needs to meet.

Nearly half of employers split their budgets between all levels of management, with 49% of organisations spending equal amounts on junior, middle and senior management.

Of the others, there was a clear preference for training junior managers – a sign Cambridge Online said that organisations are confident about investing for the future.

When it came to skills priorities, employers overwhelmingly wanted to improve people and performance management skills and want to see changes in the behaviour of their people; improvements in efficiency and productivity; an impact on the business; increased profits; and a return on their investment.

There was also a clear preference for short modular programmes, with on-site delivery and a degree of external accreditation to guarantee quality.

This matched with an indication that blended learning is becoming increasingly popular for this type of development. While more than half preferred face-to-face training, 42% of respondents were interested in blended.

David Towler, founder & CEO of Cambridge Online said: ‘The Office for National Statistics tell us that US management get 50% more than their UK counterparts out of any given set of resources. This is an extremely serious issue for the UK, but our survey shows there are clear signs that the UK is getting its act together to close the gap.

"There is a rapid rise in the use of blended learning in the UK to a point where it is beginning to match the US."