It’s not often “worker shortage” and “manufacturing” can be used in the same sentence, at least not in the U.S., where unemployment remains near 9% and 30% of the country’s automobile assembly plants have been abandoned since 2005.
But the condition exists, and the situation could worsen over the next five years if more effort isn’t put behind recruiting and training cream-of-the-crop factory workers, says one skilled-labor specialist.
A survey of senior manufacturing executives conducted earlier this year by factory-maintenance contractor Advanced Technology Services and pollster Nielson concludes the pending retirement of experienced Baby Boomers will cost companies $43 million on average as they scramble to fill the void.
Nearly 20% of the 103 executives responding to the study say costs could soar to more than $100 million, and either way most manufacturers admit to being inadequately funded for the recruiting and training task ahead.
Without proper training, manufacturing employees won’t have the math background or computer skills needed to run advanced high-tech machinery, potentially damaging product quality to the point where it could cost undermanned suppliers even more, ATS says.
A fifth of those surveyed say they are looking to fill more than 15 openings on their factory floors right now.
But with the number of plant workers pink-slipped in the past couple of years, there has to be plenty of job candidates, right?
“You would think so,” Don Johnson, vice president-marketing for ATS, tells me. “But the highly skilled, highly technical manufacturing positions these companies want…are hard to attract. People like tool and die calibration specialists, maintenance technicians…those jobs are very hard to find people to fill.”
The proof, Johnson says, is the expected growth to $200 million in annual revenues this year for ATS, which began life 25 years ago as a circuit-board repair operation inside construction-equipment maker Caterpillar but has blossomed into an independent factory-maintenance specialist that services the likes of Honeywell, Eaton, Textron and BorgWarner.
“What’s fueling a lot of that (business for ATS) is the skilled labor shortage that’s looming out there,” Johnson says.
Manufacturers contract ATS to take over their entire plant maintenance operations, a move the executive says can improve asset performance 30% and reduce scrap 40%, while removing the headache of having to recruit and train high-skilled employees. ATS typically absorbs the bulk of the plant’s existing maintenance workers, who become ATS team members and are absorbed into its culture.
To meet its own skilled-labor demands, ATS recruits heavily from the military.
“The military has the skill set, the discipline, the sense of mission that really makes a great fit for our organization,” Johnson says.
It also sponsors Associate’s Degree programs at community colleges in Peoria, IL, and Greenville, SC, and is trying to lure middle-school students toward manufacturing careers with an extracurricular program it calls “Tinkertronics.”
But Johnson says the industry isn’t moving fast enough to cultivate a skilled-labor base, and a day of reckoning is coming.
“What jumps out at me (from the survey), the companies are saying the skilled-labor shortage is going to cause issues for them five years down the road,” but they’re doing little about it, he says.
“Crisis is a strong word,” Johnson says when asked if that’s what’s coming. “I think we’re headed toward an awakening that we need to invest in vocational skills.”
Manufacturing has taken a public-relations hit in the past decade, as an endless string of factory closings has heightened the sector’s rustbelt image and pushed it well down on the list of career options for many Americans.
But Johnson says the jobs are there for people who want to jump in and learn the trade.
“Obviously, manufacturing got a pretty rough shake (in recent years),” he says. “I think that perception needs to be changed. That’s what we’re doing…reaching out to kids who are in middle schools and showing them that manufacturing can be fun.
“It’s all so high tech now, there’s nothing that resembles manufacturing of the past in the modern plants,” he adds. “If you like video games, you’re going to love manufacturing these days.”
Now if that doesn’t pull in the middle schoolers, what will?