The Manufacturing Industry is Changing. Are the Workers?

Posted by Michelle Ecker on April 22, 2020

The manufacturing industry continues to gain rapid momentum throughout the United States. According to research jointly conducted by Deloitte and the Manufacturers Alliance for Productivity and Innovation (MAPI), over the next five years more than 50% of manufacturers plan to enter a new market, and almost all plan to expand existing sites or open new facilities in countries with existing operations.

Missing from this industry boom, however, seems to be the workers.

Looming within this large swell of opportunity, a mounting need for skilled talent afflicts manufacturing leaders who seem unable to find the industry-specific workers with skills corresponding to the industry’s modern needs.

Job openings within the manufacturing sector have been growing at alarming rates since 2017, but they are now nearing a historical peak unseen within this sector in nearly two decades. Left unaddressed, this skills deficit could result in a massive loss of gross domestic product as manufacturing leaders find themselves unable to capitalize on growing opportunity due to their lack of sufficient talent. According to Deloitte projections, this could put $454 billion of manufacturing GDP at risk in 2028 alone.

Executives within the manufacturing industry continue to echo concerns regarding this critical level of skilled talent shortage, with latest surveys by Deloitte and The Manufacturing Institute revealing an unprecedented majority (89 percent) of executives agreeing there is a talent crisis in the US manufacturing sector today.

In an effort to name the root of this shortage, Deloitte, in collaboration with The Manufacturing Institute, recently launched their fourth skills gap study as a way to reevaluate projections and discuss the pointed issues within today’s industry. The research appears to highlight a specific and growing culprit, a gap between the jobs that are changing and modernizing, and the pool of skilled talent being trained to sufficiently fill them.

At the heart of this issue lies ever-shifting skill sets in correspondence with technological innovations in the workplace. While the introduction of more efficient and smarter technology should in theory streamline and simplify the manufacturing workflow, without workers properly trained to work alongside said technology, processes are unable to seamlessly move forward as modernization would hope.

Often lost in the conversation about technology’s impact on the manufacturing sector is the reality that technology is meant to work in collaboration with human workers, not in place of them. While forty-seven percent of today’s manufacturing jobs might be gone in the next 10 years, the overall headcount is expected to increase. These jobs aren’t going away with the addition of technology, they’re changing and growing along with it. The reality is that technology cannot work alone, but without properly training today’s employees to work alongside it, that growing headcount will be left unmet as industry leaders fail to properly capitalize on these innovations as intended.

In order to properly navigate these staffing challenges, industry leaders need to understand the specific skills missing as they identify what manufacturing jobs currently look like and the ways in which their workers need to be properly trained to keep up. In many ways, the present shortage in talent would suggest that the manufacturing “jobs of the future” we often discuss have already arrived- and today’s workers are simply currently unprepared to fill them.

According to the aforementioned skills gap study conducted by Deloitte and The Manufacturing Institute, today’s manufacturing executives named the following five skill sets as those expected to increase most significantly in the upcoming three years:

• Technology/computer skills
• Digital skills
• Programming skills for robots/automation
• Working with tools and technology
• Critical thinking skills

As the manufacturing industry seems to be one quickly immersed in automation and technology is increasingly embedded across all workflows, it’s becoming abundantly clear that today’s workforce needs more comprehensive training in the corresponding skills if they are expected to keep up with these changing needs. As one manufacturing executive noted, “We want to right-size our workforce, with the right skills, and give them the tools and training they need to be successful.”

Leading organizations are already taking steps to rethink the way they prepare and retain their workers. They are offering training solutions to employees as they find the most efficient ways to rearrange worker organization and better leverage technology to keep up with the transformation of today’s manufacturing workplace.

Beyond training workers to better understand and operate technology directly, these leaders are also identifying the ‘soft skills’ that are growing in demand, and unable to be solved by automation.

While technology offers a streamlined replacement for a bulk of the manual and repetitive tasks manufacturing jobs of the past entailed, it’s implementation brings with it a growing need for skills in the workplace that are uniquely human, often referred to as “soft skills.”

A recent study by the World Economic Forum identified several of these soft skills within their list of the top 10 skills anticipated to be most essential in the coming decade. These named soft skills included:

• Critical thinking
• Creativity
• Management of people

These are not skills that can be taught to machines or delegated to even the smartest robots in today’s manufacturing workplace. These are uniquely human skills, but are ones that today’s manufacturing workers have not necessarily been formally trained to successfully meet. A lack of proper workforce training to meet the demand for skills such as these is integral to an understanding of the industry talent crisis at large.