Skilled labor plays a critical role in keeping the cogs of the economy running smoothly. The manufacturing industry’s ongoing skilled labor shortage is marked by some concerning trends.
While the manufacturing industry, like many others, faces challenges related to economic uncertainty and inflationary spirals, it’s also dealing with global logistics backlogs, supply chain bottlenecks, and cyberattacks. The continued loom of a talent shortage may affect the industry’s growth momentum.
Lower productivity in the manufacturing sector and a reduced ability to meet customer demands are both significant factors contributing to inflation. Supply chain disruptions and increasing labor costs ultimately drive higher consumer prices.
As the manufacturing industry continues to grapple with difficulty drawing and retaining talent, the question begs—how can the sector attract skilled workers to drive growth and sustainability? Leaders can no longer simply lead amid disruption. They need to revamp their approach entirely.
Skilled Labor Shortages and Inflation in Manufacturing
Although American manufacturing somewhat recovered after 1.4 million pandemic-induced job losses, the industry has yet to see a full comeback. As of March 2023, the skilled labor shortage in manufacturing still stood at 693,000 vacancies. And even if the durable goods manufacturing sector managed to employ every unemployed skilled and experienced person, the industry would still only cover 75% of labor shortages.
The cause for the ongoing challenge within manufacturing is multifold.
Technological Advancements
The manufacturing industry needs workers with specialized knowledge in automation, engineering, robotics, programming, and other technical fields. With the demand for such highly skilled employees outweighing the supply, the ability to implement and maintain new technologies may be delayed. And as technology continues to increase at lightning speed, the skills gap could continue to widen.
Negative Perceptions of the Industry
Despite the rise of robotics, automation, and new technologies in manufacturing, the industry holds a poor reputation as physically demanding, low-paying, and redundant.
Some Millennials and Gen Z hold a different idea of what a well-paying, meaningful job is. With a high emphasis on the digital future prioritizing skills such as coding, it seems fewer students have been encouraged to pursue a career in the manufacturing space.
An Aging Workforce
Over 51% of manufacturing jobs in the United States are currently filled by employees aged 45 and up—with a full quarter of that workforce over the age of 55.
As baby boomers retire, it may be challenging to find workers with similar experience and expertise to fill the skills gaps. This loss of important knowledge and expertise may be a contributing factor to the skilled labor shortage.
Lack of Training Opportunities
With technology continuously advancing, workers require consistent skill advancement. Unfortunately, some workers lack the necessary training opportunities to adapt to these changes.
Other factors that may contribute to roadblocks in hiring new talent include low wages compared to other industries, little work flexibility, work safety incidences, and lack of diversity.
The skilled labor shortage doesn’t only affect the manufacturing industry, but also can affect the wider economy. Some of the industry is witnessing lower productivity, with difficulty meeting consumer demands, with some seeing a rise in labor costs.
Ongoing labor challenges may also impede U.S. manufacturing companies’ ability to expand or invest in emerging technologies that improve productivity rates and workplace safety—exacerbating the cycle. Effective solutions are needed, and some experts believe attracting more younger workers is key.
Strategies to Consider for Attracting Millennials and Gen Z to Your Manufacturing Business
In addition to current situational factors, the manufacturing industry’s need to appeal to younger workers may lie in a simple analysis of the sector’s demographics. The present generation of manufacturing workers is aging toward retirement. As workers age out of the workforce, businesses may want to consider sourcing younger labor as replacements.
Manufacturing businesses may have a number of tools at their disposal, which they can leverage. Is it time to tap into promotional strategies such as vocational school outreach programs, social media recruitment, and enhanced mentorship and training initiatives to expand your outreach?
Academic and Vocational Institutions to Have Access to Young Talent Pools
Companies that form partnerships with vocational schools may gain access to a large and renewable source of emerging talent that can bridge shortages long-term. These relationship-building efforts can begin at the high school level and continue into postsecondary education. Businesses may want to consider reaching out to career counselors and program administrators at these institutions, describing the changing nature of needed qualifications and skills and offering to participate in curriculum development.
Another potential strategy is to create internship and apprenticeship programs that draw on student bases at local schools. These provide hands-on training opportunities and school-to-job pipelines that can help companies meet their labor needs.
To boost success in these areas, some experts suggest that companies find ways to add value to their work environments. Some younger workers tend to attach significant weight to benefits like scheduling flexibility and professional development opportunities (think continuing education, licensing, and certification). Meeting younger workers' needs in these areas may give businesses an edge over competitors with regard to attracting and retaining talent. Considering the state of skilled labor, the financial investment in flexible scheduling platforms and educational resources might be worth the return.
The Power of Social Media to Engage with Millennial and Gen Z Workers
Millennials and Generation Z tend to be tech-savvy digital natives who have grown up in an internet-connected world. As such, using social media as a marketing, branding, and recruitment tool may help businesses appear more relevant. The idea is to try to reach these prospective recruits where they are. This may widen the access pool and also make you appear in touch with their concerns.
Businesses can leverage social media to tell their story on their terms. By advertising competitive pay rates and benefits packages, you can craft an appealing image of what manufacturing careers look like. Boasting benefits such as paid education opportunities, or flexible options for parents with childcare needs may also be another effective message within social media marketing. Running job ads on these channels can also allow you to directly recruit workers—rather than moving through third parties.
Some experts suggest drawing on a range of targeted social media strategies. Consider centering your advertising on these key objectives:
- Show how the company directly benefits employees seeking personal and professional development support
- Explain the company’s unique sense of purpose and alignment with shared social values
- Promote appealing aspects of working at the company, from high pay rates and rewards programs to continuing education opportunities
- Share recruitment-oriented social media content with carefully targeted groups and communities
- Debunk myths about “factory life”
Companies sometimes use employee testimonials to speak directly to their targeted audiences. Building out referral programs that offer meaningful rewards to employees who leverage their own social media profiles and followers, can also help attract candidates.
Mentorship and Training Programs for Effective Manufacturing Talent Transfer
Manufacturing businesses can address a skilled labor shortage by taking proactive steps to expand the scope of succession planning through formal mentorship programs.
Consider pairing new hires with mentors to help guide their integration and professional development. Mentors can be drawn from the ranks of established employees. This may ensure that the company’s labor pool stays resilient, well-trained, and responsive.
Robust training programs might also attract motivated applicants. Creating curriculum-guided training programs may accelerate onboarding rates and help new employees optimize their productivity. Manufacturing training programs have the ability to deliver high-impact, targeted, on-the-job education that teaches the proficiencies new hires need. Companies willing and able to provide such in-house training and education may be able to cast wider nets in their candidate searches. Instead of hunting for exclusively ready-made candidates, you could draw in more applicants by signaling that you’re willing to get them up to speed.
While some manufacturing businesses offer internships, technical apprenticeships have traditionally been more common in the industry. Apprenticeships are designed to function as paid training programs to develop specific skills.
These programs are intended to be a longer-term investment in individuals. In the manufacturing sector, they can take anywhere between one and four years to complete. However, apprenticeships typically result in stronger retention rates: some studies find that up to 92% of apprentices become full-time company employees! Therefore, they often serve as effective ways to address and prevent labor shortages from impacting company operations.
Younger Workers and the Skilled Labor Shortage
Manufacturing businesses that make targeted and proactive investments in resource development often stand the strongest chance of overcoming the critical skilled labor shortage. Knowing which programs to develop is half the battle.
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