A widening skills gap threatens U.S. manufacturing competitiveness and consequently our economy. A talent pipeline with a sufficient supply of properly aligned skills is imperative to meet U.S. manufacturers’ needs for capacity, productivity and innovation.
We expect 3.5 million manufacturing jobs will likely need to be filled over the next decade with a skills gap that is expected to leave in excess of 2 million of those jobs unfilled. The gap is a result of an overall shortfall of recruits, a mismatch between the skills needed by manufacturers and the skill sets of available workers, and a high rate of retirement. A surge in reshoring will increase that gap by millions more. The long-term skills gap has contributed to a loss of U.S. manufacturing over the last 40 years. Failure to overcome the gap now will limit the U.S.’ ability to ride the reshoring wave.
Global manufacturing executives rank skilled talent as the number one driver of manufacturing competitiveness. As manufacturers increase competitiveness with automation and other new technologies, the workforce will need comprehensive training and corresponding skills to interact and grow. New-collar workers must develop technical and soft skills through non-traditional educational paths, including community colleges, vocational schools, software boot camps, technical certification programs, high school technical education and on-the-job apprenticeships and internships as opposed to a four-year university degree. Manufacturers must incorporate lifelong learning into their business plans to develop the future workforce needed for “smart factories.”
Digitization and reshoring are tightly and positively linked. Reshoring increases capacity utilization, which drives capital investment in the newest technologies. The new systems increase competitiveness, enable recruitment of a smarter, tech-oriented workforce, and thus enable more reshoring (see Figure 1 below).
Manufacturing executives expect the demand for the following five skills to increase significantly within the next three years:
--technology/computer skills,
--digital skills,
--programming skills for robots/automation,
--working with tools and technology, and
--critical thinking skills.
Some organizations are already making investments in training. Earlier this year, BMW broke ground on a 67,000-ft2 (6225-m2) training center in South Carolina with a $20 million investment, as part of the company’s $200 million, five-year workforce training investment.
Rockford, Illinois-based PBC Linear found that the COVID-19 pandemic accelerated the skilled labor shortage. Beau Wileman, a design engineer at PBC Linear, discovered that new technology was the most efficient way to train new workers. Wileman turned to augmented reality (AR) to reduce training time and the need for manager supervision during training. “We have since refined the process where 70 percent of training occurs through the headset,” said Wileman.
FANUC America Corp., Rochester Hills, Mich., provider of CNC systems, robotics and factory automation, formed a coalition with Rockwell Automation Inc., Milwaukee, provider of industrial automation and digital transformation, to address the manufacturing skills gap with robotics and automation apprenticeship programs that offer opportunities to gain credentials.
The Fourth Industrial Revolution (Industry 4.0) is transforming work due to rapidly changing technologies like AI, advanced robotics and cognitive automation, advanced analytics, and the Internet of Things (IoT). New technologies help developed countries like the U.S. reduce the labor hours required to produce goods and shift jobs toward higher skilled workers.
A new study by Mendix, a Siemens business, showed manufacturing workers are interested in learning new digital skills (83 percent), and they see learning new digital skills as important to success in their current role (62 percent). The availability of a skilled workforce is critical for industry retention and expansion. The workforce must have the skillsets required to operate, maintain and repair the automated equipment that will power new production processes.
This means skilled workforce recruitment and training is vital to grow manufacturing in the U.S.
The apprenticeship is an industry-driven, high-quality career pathway where employers can develop and prepare their future workforce, and individuals can obtain paid work experience, classroom instruction, and a portable, nationally recognized credential. Figure 2 shows the entrepreneurial opportunities open to the skilled workforce. Of the owners of contract manufacturing machine shops, 63 percent were apprentice graduates or had other skills training.
Aerospace giant Lockheed Martin, Bethesda, Md., uses several pathways to fill its skilled talent pipeline. In early 2020 it launched a vocational scholarship program for high school seniors and college students pursuing vocational degrees. The scholarship funds degrees at accredited vocational-technical schools to prepare students for advanced manufacturing degrees that don’t require a bachelor’s or advanced degree. Lockheed Martin also offers a four-year STEM Scholarship program and apprenticeships that range from aircraft maintenance and assembly to software, cyber security and engineering.
Detroit-based LIFT, a national manufacturing innovation institute, recently received $1 million to expand its Operation Next program to reskill/upskill workers impacted by the COVID-19 pandemic. A skilled and ready workforce is among the most critical assets for manufacturing employers’ recovery post-COVID-19, LIFT said in a statement.
Development of a skilled workforce begins with motivating a higher number of recruits that are more qualified. Words matter. Stop referring to “trades and vocations” for jobs requiring significant post-secondary training, such as apprenticeships. Adopt the wording that helped produce the exceptional German and Swiss manufacturing workforces: professions.
More informative categorizations of certain occupations can result in additional recruitment for skills training. For example, terminate the use of “middle-skills” and implement a term such as “skilled manufacturing technologists.” Categorize skill level by the work that is accomplished, not by the number of degrees held by the workers. Is an apprentice graduate CNC machinist or toolmaker lower skilled than an English major working at a desk in an insurance company?
Creating a stronger skilled workforce is critical to reshoring and the country’s manufacturing growth. Working together, the Reshoring Initiative and SME stand ready to help manufacturers make better sourcing decisions, bring offshored work to their region or industry, and develop a stronger skilled workforce.
Editor’s Note: For more information, contact Harry Moser at 847-867-1144, or by email at harry.moser@reshorenow.org
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