Concerns about the skills gap in manufacturing aren’t uniform across all companies, according to a PwC/Manufacturing Institute survey of 120 U.S. manufacturers. However, the need for advanced manufacturing skills is still great, and is strong.
The results of the survey are detailed in a study, titled “Upskilling Manufacturing: How Technology Is Disrupting America’s Industrial Labor Force.” It explains that manufacturers need a new generation of employees who possess both skills and comfort with evolving technology and increased automation, and, consequently, companies are competing to hire tech-savvy talent, upskill existing workers or both.
I was particularly interested to see that 33 percent of the respondents said their company has no or only “a little difficulty” in hiring talent to exploit advanced manufacturing technologies, but that 44 percent of the respondent said they have “moderate difficulty” hiring skilled workers. Nonetheless, there is significant concern that the situation will worsen: 31 percent of the respondents say they see no manufacturing skills shortage now but they expect there will be a shortage in the next three years; 26 percent said the skills shortage has already peaked and is behind us; and 29 percent said the shortage exists and will only worsen in the next three years.
On the other hand, the study also notes that although respondents expressed some nervousness concerning a skills gap, manufacturers are working to close those gaps. The study explains that there are a range of practices used by manufacturers to close the skills gap, and although some are traditional and widely followed, others remain untested but offer potential.
The most practical and widely used practice is to train in the workplace, which is what most manufacturers do. Another practical and increasingly common approach is to train outside of the workplace. For example, manufacturers are teaming up with community colleges or vocational schools to meet demand for different skills and equipment. Progress on nationally accepted credentials across different skill sets would likely accelerate uptake, according to the study.
Companies are also working to recruit STEM graduates directly, which is typically done via job fairs, internships, and above all, productive relationships with educational institutions. It must be noted, according to the study, that the learning curve for some manufacturers’ HR departments may be steep. Competition for talented people in tech is fierce, and keeping up with the skill sets in demand could also be challenging.
When thinking about practices that aren’t widely used, but are poised to grow quickly, the most common practice is to hire outside of the industry, according to the study. Furthermore, as manufacturers invest in and deploy advancing technologies, hiring from outside the sector will likely grow. Additionally, manufacturing jobs requiring skills from other fields—such as gaming, CAD simulation and virtual reality—could draw candidates from, and compete with, other fields.
The most promising yet untested hiring practice for the U.S. labor market cited in the study is apprenticeships. The U.S. government and some states are making efforts to support and mainstream apprenticeship programs in the manufacturing sector. Consequently, registered apprenticeships have increased: according to the U.S. Department of Labor, there were about 450,000 registered apprenticeships in 2015, up from 350,000 in 2011.
Finally, the study lists two, what it calls, “wild cards.” The first is to import talent from outside the U.S. A majority of survey respondents (60 percent) said they believe the industry would be more competitive if it were easier for foreign nationals with the relevant technology skills to work in the U.S.
A second wild card approach is to consider the maker generation and the gig economy. Manufacturers will likely be looking to makers for more than orders, according to the study. They could represent a deep and growing reservoir of talent. There is also a growing number of freelancers who could be tapped for short- or long-term contract work, offering manufacturers a flexible approach to talent management, the study notes.
What are your thoughts on the level of a skills gap? Do you think it’s growing? If so, how is your company addressing the skills gap?