Facing Workforce Challenges in Manufacturing

Manufacturers know how to handle challenges. When 30% of US manufacturing shifts were lost in April 2020, the industry took a deep breath, then got right back to work. A mere five months later, shift-work volume was at 90.6%. In fact, over half of the manufacturers surveyed in Workforce Institute’s study achieved year-over-year growth in the first 12 months of the pandemic.

As the business has grown, so too have the challenges. Manufacturing faces a severely lacking workforce in an ultra-competitive labor market, and to win it will take cunning strategy and adaptability.

The skilled labor shortage is not new, having affected roughly one-third of manufacturers pre-pandemic. Now, however, it appears to be an industry-wide issue. Despite pandemic job losses and industry slow-down, the Bureau of Labor data showed over 800,000 positions unfilled halfway through 2021. By spring of 2022, those numbers had not gone down. Manufacturing continues to be one of the top five industries affected by the labor shortage, which could lead to an industry loss of up to $1 trillion from unfilled jobs in less than a decade.

Even filling entry-level roles is a challenging prospect. There’s fierce competition in the labor market, and workers prefer jobs in retail, services, and technology. It’s becoming increasingly difficult to fill middle-skills roles, which require technical and applied skills. Either the workforce isn’t there, or the workers available lack the skills to fill these critical roles.

The manufacturing skills gap will only grow; as automation transforms how the floor functions, many skills developed over years and decades are becoming obsolete.

As new generations of talent join the workforce, they need an improved image of manufacturing. Here are strategies that can help:

• Update company messaging: From branding and social media participation to job descriptions and role titles, refresh the wording, images, and tone.
• Get involved locally: Visit job fairs and join school outreach events to present trades as viable career options.
• Show off the future: Younger generations are more tech-oriented; show off the futuristic elements of manufacturing and connect to a world that interests them.
• Get active with DEI: Conduct DEI and anti-harassment training at all levels to build an open culture; it’s a huge issue for younger workers.
• Get vocal about DEI: As you make the needed culture adjustments, talk about them.
• Hire for fit: Rather than fighting the manufacturing skills gap, accept it. Be strategic about hiring individuals who have the right attributes and train for the role.

The pandemic changed how the workplace functions. And while manufacturers can’t, in most cases, compete as a remote-work option, they can compete in other ways. The younger generation of workers has high expectations in many areas, but they’re disillusioned in others. The college-to-career path is no longer trustworthy. Many young people want to avoid the burden of student loans. Job security isn’t a given. Reaching landmark goals in a crisis and economic upheaval seems impossible to many.

If manufacturers focus on the issues that overwhelm these younger generations, they can offer real help and support—and gain credibility, interest, and over time, loyalty:

• Map out careers: Help these new hires to see what’s possible in a long-term trade career and map out roles, timelines, and earnings potential.
• Invest in managerial training: Gen Z isn’t afraid to walk away from a job where they’re treated poorly. You need good managers with the right mentality and developed leadership skills.
• Offer personalized packages: The younger generations in the workforce emphasize benefit packages, but they don’t all need the same coverage. Gen Z especially values the ability to personalize their coverage and pay for what they’ll actually use.
• Bring in diverse fringe offers: Explore fringe benefits, such as parental leave and loan repayment assistance, that provide flexibility and help younger workers create the work-life balance they crave.
• Go for low-cost, high-impact: Get advice on cost-friendly fringe options like pet insurance, and explore HSA and HRA models to find the most effective way to add value for employees.
• Support life goals: Don’t limit benefits to healthcare. Think about offering access to resources to help workers build financial wellness and navigate major life events, like starting a family or buying a home.

It’s always key to communicate. You might have the most comprehensive and flexible benefits package, but it won’t help if no one understands the value. Don’t assume that the terms are clear or that current employees understand their benefits and options. Instead, simplify language, spell out the values, and educate both current and potential members of your workforce.

Communication is also key to workforce development. The future is coming, full speed ahead, with more changes: some predictable, some not. Manufacturing will have to adapt and implement smart changes in strategic ways. To make those changes successful, put intense effort into listening, communicating, and educating:

• Survey long-term employees: They can provide valuable insights on why they stayed, what made their jobs fulfilling and worthwhile, and what could be better.
• Create mentoring programs: Mentorship can go both ways. Older generations can aid in passing on the knowledge of more traditional skills. Younger generations can help others adapt to new technology and changing roles.
• Find out what matters: Get employee feedback regularly to learn what actually makes a positive impact in terms of culture, training, flexibility, and benefits.
• Communicate, communicate, communicate: The more you listen, the more you can deliver efficiently on workplace updates and company priorities. Clear and responsive communication will help manufacturers build a workforce that can thrive in changing environments and adapting work modes.

Manufacturing has changed. Automation has transformed what the floor looks like, and culture has shifted. As a result, new employees expect a different kind of workplace. With the right changes in manufacturing employment, training, and workforce development, the industry can move forward and continue to grow, equipped for the floor of the future.

If you have questions about managing your workforce, reach out to Evan Cole or one of our Manufacturing Advisors.