US manufacturing is standing at a significant milestone in its long history. The intersection of technology advances, population growth and political factors have had a significant impact on the changing American business environment. According to a new study from The Manufacturing Institute, the United States manufacturing industry, has shown steady growth in recent years, and has even more opportunity ahead.
- More than 50% of companies report plans to increase US-based production by at least 5% in the next five years.
- Nearly 25% of organizations plan to grow US-based manufacturing roles by over 10% in the next five years.
- More than 75% of manufacturers report a moderate to severe shortage of skilled resources.
Industry leaders need to have a strategic vision to be able to help their organizations navigate these changes. Among top challenges they face is the issue of hiring and human resource management.
The lack of skilled workers has been a constant problem for several years in American manufacturing. The shortage of employees in positions requiring post-high school education but less than four years of college has been mentioned in Accenture's 2014 Manufacturing Skills and Training Study.
This issue is predicted to continue for many years ahead. A study from the Manufacturing Institute said that there will be between 600,000 to 2 million vacant manufacturing jobs positions by 2025. In addition, the population is aging and skilled workers will retire which will contribute to increasing numbers of vacant positions. The shortage of skilled workers has and will continue to lead to many difficulties for hiring in the manufacturing sector.
The problem is two-fold: finding new skilled workers as well as retaining current ones. Highly skilled workers, especially in areas such as computers and automation, are very few in number and they often go to higher-paying companies. This is also true for employees with a lot of experience in the industry. Naturally, they demand a high salary to compensate for their deep investment in specialist job skills. This competition over wages will contribute to the burden on manufacturing employers.
Outsourcing is an attractive option for employers when facing a labor shortage, but this often leads to many difficult decisions that need to be carefully considered. Using offshore outsourcing can help cut costs, but outsourcing in the country has the benefits of management, quality assurance and human resource coordination.
Many companies have come up with solutions for shaping their own talent supply chain. They are identifying their needs early and developing apprenticeship programs to train laborers themselves. In this way, trainees may begin work immediately at the end of their apprenticeship.
Research indicates that, given the reported difficulty of finding qualified candidates, companies should change the notion of finding the “perfect” candidate based on a long list of highly specific skills, education or experience. Instead, they should look for candidates with more generalist skills -- even those outside of their industry, in other geographic locations or with overlapping skill sets -- that can easily be developed to perform the job.
Another potential solution involves manufacturers creating close partnerships with the local colleges and universities, sponsoring training programs as well as internships programs to inspire potential candidates to apply early. This essentially will enable businesses to show a presence even before these candidates enter the job market, providing potential leverage over competitors.
To keep pace with rapid advances in technology at a time of increased competition and shrinking resources, another solution is to work with a staffing company that specializes in the manufacturing industry. Partnering with a staffing firm can enhance efficiencies and help a company better adapt to changing resource requirements. Without adding fixed, long-term employer commitments, temporary employees act as an extension of the manufacturer’s core team of professionals.
Creating a new generation of skilled workers is a long-term goal for the entire manufacturing industry. Every company has a role to play in finding and cultivating talent and training and equipping employees with the necessary skills to meet the demands of the future.
BECO, a division of Messina Group Staffing has worked in the Manufacturing Industry for over 50 years, and offers a full spectrum of Temporary, Contract-to-Hire and Direct Hire services to the engineering and technical communities. When it comes to manufacturing hiring challenges, we're committed to help you find the right solutions.
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