While many of us feel as if we’ve lost an appendage when we forget our cell phone some place, the newest vision of manufacturing and Industry 4.0 might make technology as appendages a bigger reality. Industry 4.0, the vision of the interconnected factory, radically changes the face of manufacturing by focusing on connected devices and platforms that use data gathered from the physical world. Many large manufacturers are already pushing forward with an industry 4.0 strategy and others are certainly thinking about making use of technology around data and automation to increase profitability in their own business strategies. But, what does this mean for the people, and what does this mean for leaders hiring manufacturing workers?
Jobs that require an assembly line of employees focusing on a single, possibly repetitive skill are going away. With the growth of computer-controlled manufacturing systems and robotics, there is a demand for different types of manufacturing employee: those with skills in data analytics and programming. No longer are physical prowess and a motivation to work all you need for a job in manufacturing. Technology, information and more recently automation are playing a big part in the shift toward needing a more specialized and adaptable worker.
This is not new. Manufacturers have spoken about a gap between the people they need to keep profits up and the talent they can find. And, this problem is getting deeper: According to Deloitte in the US, three and a half million manufacturing jobs will likely need to be filled between 2015 and 2025, with 2 million of these likely to remain unfilled. This is also going to be exacerbated by the retirement of Baby Boomers, skilled production workers born between 1946 and 1964.
Other issues may include a negative view of manufacturing by young people and a lack of quality STEM (science, technology, engineering and mathematical) talent.
The Cost of the Skills Gap
For manufacturing leaders and executives, talent plays a big part in driving the innovation needed to make their businesses more competitive. If people with the right skills are lacking, then this will have an impact on growth and profitability.
According to Deloitte in the report “The skills gap in US manufacturing – US and beyond,” 82 percent of executives believe the skills gap will impact their ability to meet customer demand, while 78 percent think it will impact their ability to implement new technology and increase productivity. Manufacturing executives also believe the skills gap will impact the ability to provide customer service (69%) and their ability to grow and expand internationally (48%). Seven out of 10 manufacturing executives also reported shortages of workers with the right technology, computer, and technical training skills.
Not to mention, hiring manufacturing workers can be very difficult. According to Deloitte’s research, six out of 10 manufacturing positions remained unfilled because there simply aren’t enough candidates. The hiring lead time is long: It takes an average of 94 days to recruit an employee in the fields of engineering, research, and science and 70 days to recruit a skilled production worker, which drastically impacts a manufacturer’s ability to meet customer demand.
Upskill Your Existing Staff
According to Deloitte, around 94 percent of manufacturing executives agreed that internal training and development were the most effective ways of dealing with the skills problem. Other ways to upskill from within include:
Train employees from within
In today’s climate, manufacturers shouldn’t depend on keeping talented workers long term. They should instead think about improving the skills of the group, focusing on internal employee training and competency. Make sure these senior figures share knowledge, ensuring that the skills they developed can be kept in the business. Supply employees the means for internal training and development, specifically crafted to meet a company’s needs.
Identify STEM students at academic institutions
The long-term future of US manufacturing and other industries is dependent on STEM education, as STEM jobs are needed to keep pace with global competitors. Manufacturers today can do their part by joining forces with universities and other academic institutions in providing graduates a pathway into a lucrative manufacturing career. Students need to know about the cutting-edge technologies and careers available in manufacturing.
Provide training outside the company
In-house training can take people away from their day-to-day tasks and only works if you have adequate teachers. Sometimes, workers need fresh perspectives from outside of a culture that is stifling innovation. External training allows company leaders to choose whoever they want to manage it, which may be just what a company needs!
Hire employees from outside of the manufacturing sector
Bringing in engineers and experts from outside of manufacturing can bring in new ideas and insight on how to solve problems, as well as knowledge on innovation and technologies. Manufacturers might be able to add new ideas to testing and quality, accelerating processes that long-established companies might have felt were set in stone.
Hire from other manufacturing companies
To bring in talent from competing businesses, manufacturers must build a solid employment brand which can convince world-class talent that the culture and values they hold are what they should be looking for. It might also mean putting a focus on the right recruitment strategies, whether that’s through the use of recruiters, social media channels, or the right level of pay and benefits suitable for the skills needed.
Be sure to check back for Part II in this series, “The Perception Problem.”
Cloud ERP and Mobile Solutions from ASI
Accounting Systems Incorporated (ASI) can play a role in upgrading your systems to attract and retain the right employees. Cloud ERP such as Acumatica, and mobile solutions for Sage 100 also provide the flexibility to grow with your company. For more information, click here or call us at 803,252-6154