As bad as it may be, the manufacturing skills gap is only going to get worse, according to the findings in a new report.

 

In “ The Skills Gap in U.S. Manufacturing: 2015 and Beyond,” authors from Deloitte and The Manufacturing Institute explain that over the next decade, nearly three and a half million manufacturing jobs will likely need to be filled but the result of the skills gap will be that two million of those jobs will go unfilled. There are two major contributing factors to the widening gap: baby boomer retirements and economic expansion. An estimated 2.7 million jobs are likely to be needed as a result of existing workforce members retiring, while 700,000 jobs are likely to be created due to natural business growth, according to the report.

 

Other significant factors, such as the loss of embedded knowledge due to movement of experienced workers, lack of STEM (science, technology, engineering and mathematics) skills among workers, and a gradual decline of technical education programs in public high school, will compound the labor shortage. Perhaps the largest challenge, though, is a negative image of the manufacturing industry among younger generations. Indeed, in a poll conducted by the Foundation of Fabricators & Manufacturers Association, 52 percent of all surveyed teenagers said they have no interest in a manufacturing career, the Deloitte and The Manufacturing Institute report notes. What’s more, of the 52 percent of the respondents who have no interest in manufacturing, nearly two-thirds (61 percent) say they believe a manufacturing career entails a “dirty, dangerous place that requires little thinking or skill from its workers and offers minimal opportunity for personal growth or career advancement,” the report continues.

 

CEOs and manufacturing executives recognize that talent-driven innovation is critical for competitiveness, so they also realize that a worsening talent shortage would have significant impact on companies’ growth and profitability. For example, 82 percent of executives responding to the Skills Gap survey indicated they believe the skills gap will impact their company’s ability to meet customer demand, and 78 percent believe it will impact their company’s ability to implement new technologies and increase productivity, the report notes. Furthermore, the executives also indicated the skills gap also impacts the ability to provide effective customer service (cited by 69 percent of the respondents), the ability to innovate and develop new products (62 percent), and the ability to expand internationally (48 percent).

 

It should be noted that many manufacturers do engage in initiatives that promote the industry as a viable career choice, as a means to address perception issues. For example, more than 1,600 manufacturing events, with an estimated 250,000 attendees, were hosted as part of Manufacturing Day, the report notes. The efforts’ mission is to increase positive perception of the industry and ensure ongoing prosperity of the industry, which is certainly something the industry must do to attract the number and level of talent required for the future.

 

Unfortunately, there isn't a silver bullet that can eradicate the skills shortage. Instead, it seems a combination of strategies must be employed in concert across the industry. For instance, the U.S. federal and state governments must continue and increase their focus on improving the education system and businesses must do their part to support the effort, the report notes.

 

However, the Deloitte and The Manufacturing Institute authors also believe executives at manufacturing companies must rethink their talent sourcing and recruiting strategies to attract new employees, improve candidate screening practices, and define clear competency models and role-based skills requirements. They also need to invest in internal training and development, and engage with local schools and community colleges. None of these solutions on their own will close the gap, but together, manufacturers, academia, communities and government can provide a foundation to mitigate the skills gap over time, the authors write.

 

What are your thoughts on the manufacturing skills shortage? Do you agree with the assessment by the report authors from Deloitte and The Manufacturing Institute?