Addressing talent shortages on the production floor
Rising unemployment rates are often a key topic in political discourse in Washington. In April 2020, it hit a modern high of 14.80%. But for manufacturers in the United States and many parts of the developed world, the crisis is backwards: severe labor shortages.
The generational ‘skills gap’ in manufacturing is shaping up to be a major headache – as more baby boomers and Generation X workers approach retirement age, it is not. There are not enough young workers waiting in the labor market to replace them. The sector could face 2.4 million vacancies by 2028, according to a Deloitte study. A preference for white collar jobs, misconceptions about career and salary prospects in manufacturing and the lack of adequate qualified training centers are among the reasons for this crisis.
While there are no easy fixes, manufacturers aren’t sitting idly by – many are trying a mix of interim solutions and long-term alternatives.
Recycling and retraining of existing workers
While it can’t solve a problem of this magnitude, relying on your existing workers can work in the short term. Existing workers can be improved either by internal training / retraining or by sponsoring courses at external educational institutions. There are several advantages to this approach. It fosters a sense of loyalty that will help improve employee retention, and it’s also less risky, as you’re dealing with familiar and experienced professionals rather than unfamiliar newcomers.
Age is just a number – in professional sports many athletes have played well beyond the average retirement age. This is also possible to some extent in manufacturing, provided the company is willing to make significant safety adjustments. German manufacturers like Porsche are already investing in equipment and workplace changes to make work more comfortable and safer for older employees. Swivel chairs with telescoping functions allow workers to perform tasks without standing for hours.
Tools connected to armrests, redesigned non-slip floors, exoskeletons for lifting heavy loads, specially designed robots that work in tandem with humans (“cobots” or collaborative robots) – German manufacturers are leading the way in this field.
Internships and apprenticeships
The new generations simply do not have any kind of exposure to the manufacturing sector. Many job seekers are intimidated to apply for positions in the manufacturing sector due to a complete lack of relevant knowledge and experience. Companies that partner with educational institutions, especially technical institutes and trade schools, can tap into a promising talent pool. More advanced apprenticeships can also create a mutually beneficial arrangement: apprentice candidates receive valuable training that improves their career prospects, while the manufacturer can assess unknown candidates before offering a full-time employment contract.
It is also high time that manufacturers tap into new sources of talent outside of colleges and universities. They should be inspired by the US military recruiting strategy and offer a second chance to former convicts. Boeing is a prime example of a large manufacturer that is already providing employment opportunities to former criminals.
Another approach is to focus on skills when hiring. Instead of looking for degrees and certificates, manufacturers could start looking for people with professional skills. If they fit a vacant position in the factory, they could be hired and deployed with minimal training.
Veterans of the military and people made redundant by other industries are also excellent sources of new employees. Sectors like retail and hospitality are struggling due to the ongoing pandemic. Millions of new job seekers have entered the market from these industries. Manufacturers should consider offering jobs to promising people, even if they have no factory work experience.
Leverage software and data analytics
Many facilities suffer from inefficient deployment of workers, with delays in processing work orders, long periods of inactivity, Frequent equipment failures, spare parts shortages, and a general lack of critical data-driven planning. Upgrading a factory using modern technologies such as IoT sensors, IT maintenance management software (CMMS) and analyzing AI data could eliminate many of these problems. A CMMS in particular is a very cost effective option that can streamline maintenance processes and help managers accomplish more with a smaller workforce.
Improve compensation and benefits
Today’s tech companies are leading the way by offering generous salary packages and innovative benefits. Manufacturers need to follow suit and get creative in how they deliver perks, bonuses, and other perks to new hires.
For example, many young workers are struggling with student loan debt – companies offering help with such loans could attract a lot of attention from new generation job seekers. Tax benefits, special cash benefits, and enhanced health / medical plans are all options.
Granted, none of them are cheap or economical – but management will have to compromise in this regard to have any chance of effectively addressing the labor shortage. Without decent wages, employee retention will always be an uphill battle.
The labor shortage in factories is not an overnight crisis. Therefore, there is no quick fix to the problem. Manufacturing will need to use a holistic approach, with a mix of short-term dressings and more systemic, long-term changes to address the issue.
Bryan Christiansen is the Founder and CEO of CMMS Limble.