While the manufacturing industry in the U.S. has experienced recent growth, it still needs to become more competitive in the near future to drive economic growth.
The United States still has the largest manufacturing sector in the world, and its market share (around 20%) has held steady for 30 years.
In fact, recent research shows that every dollar of final sales of manufactured products contributes $1.33 to the overall economy—the single largest multiplier of any industry.
Yet there is one obstacle in the way: A significant shortage of skilled workers—both now and into the future. For example, in a research survey, 67% of respondents report a "moderate to severe" shortage of available, qualified workers. Worse, another 56% anticipate the shortage becoming worse in the next three to five years as baby boomer workers continue to retire.
With this outlook, the question remains: What can manufacturers do now to address the growing skills gap and better position themselves for future success? More specifically, what talent management best practices can they implement now to improve their recruiting and talent management processes?
This article will briefly highlight three recommendations for helping today's manufacturers overcome these challenges so they can increase their performance—and their competitive edge.
How Did We Get Here?
While the skills gap dilemma in manufacturing is not a new concept, it is a challenging one. For years, manufacturers have noticed a significant gap between the talent they need and the prospective employees they can actually hire. Making matters worse, the most difficult positions to fill—machinists, operators, specialized technicians—also tend to be the most important.
As a result, shortages in skilled manufacturing jobs significantly decrease manufacturers' abilities to increase efficiencies, maximize operations, deliver superior customer service, and improve overall productivity.
While manufacturing companies recognize the importance of improving their recruiting and talent management processes, many still rely on outdated approaches for attracting employees, developing their skills, and helping them grow within the company. As a result, manufacturers desperately need to come up with more creative strategies to address the problem.
Take Action: Ways to Overcome the Gap
The good news is that by taking action now, manufacturers can begin to influence results that will pay dividends in the future.
In fact, there are three best practices all manufacturers should consider implementing to overcome the skills gap.
1. Plant the Seed Early
Call it another example of sad but true: Today, the entire manufacturing industry suffers from an image problem as well as a general misconception of what it's like to work within the sector.
It's much larger than a recruiting challenge when you consider its domino effect. As baby boomers continue to retire, it becomes increasingly difficult to attract the next generation of employees. In turn, this can lead to a diminished ability to compete, the possible shift of more jobs overseas, and a weaker economy.
To change the perception, manufacturers must be more proactive in educating their communities and communicating that this industry represents a desirable—and rewarding—career path.
This can be done in a number of ways. One method is to create programs that connect with children as early as possible, especially in high school, middle school, and even elementary school. Company representatives can pair up with STEM programs (science, technology, engineering, and mathematics) to show real-world examples of how manufacturing jobs use these skills each and every day. They could also offer "day in the life" examples to show how exceptional STEM students have achieved success in their manufacturing careers.
Manufacturers can also point to the fact that their employees use the latest skills, innovations, and cutting-edge technology to create tangible, meaningful products. They can also promote compensation and the fact that the average manufacturing position pays better than many other industries.
The goal is for manufacturers to create a new perception among the next generation of prospective employees, so they can better position themselves as an employer of choice—both within their community and at a broader level when competing with other sectors.
Finding & Developing Talent
2. Leave No Stone Unturned
Manufacturing companies also have to be creative for searching for employees in new places. Forget true "talent pools"; many of these examples may be outside the normal purview of HR and corporate recruiters.
For example, one manufacturing executive reported that by auditing certain courses at a local community college, he was able to identify young people with the skills his company needed. Other manufacturers have also had success with creating scholarships or internships, or partnering with local vocational training programs.
Also, veterans and recently discharged military personnel tend to be loyal, hard-working employees, so many manufacturers seek them out through veteran's administration programs, job boards, or other outreach efforts.
3. Develop Internal Talent
Manufacturing companies must also look within to identify employees for advancement or those who could be trained to fill existing gaps. To do so, they must carefully consider what attributes the entire organization values and needs, gain insight into existing employees' skills, and implement the right programs to develop the right employees.
In many industries, traditional competency modeling, training, and career development programs would seem to be the answer. Yet in the same research study as mentioned earlier, only 31% of respondent-companies reported having formal career development, and only 17% of the respondents report using competency model tools.
Worse, many manufacturing executives are skeptical about the effectiveness of these programs, suggesting these rates could decline further.
Again, nontraditional, more creative approaches work better. One manufacturing company addressed the challenge by creating a multidisciplinary work group comprised of baby boomers and younger employees. By providing mentorship and development opportunities, the baby boomers were able to transfer certain, more desirable skills to the next generation of high-potential employees, better positioning the company for future success.
Whatever You Do, Don't Stop!
Manufacturing touches every aspect of our lives, including everything from food to medicines to clothing and more. Clearly it's important for manufacturers to do all they can to tighten the skills gap. By implementing creative solutions, manufacturers can improve the way they attract the new generation of skilled workers and achieve better results—now and well into the future.