Closing the Talent Gap in Manufacturing: New Survey Results

Today’s post comes to us from the executive director of The Workforce Institute at UKG, Dr. Chris Mullen, Ph.D., SHRM-SCP, SPHR.

Our latest research, released yesterday in anticipation of MFG Day on Friday, Oct. 2, is focused on revealing pre-pandemic insights, recruitment strategies, and initiatives from hiring managers at U.S. manufacturing organizations that could help close the talent gap in manufacturing.

As my colleague at UKG, Kylene Zenk recently highlighted, the frontline manufacturing workforce has played an absolutely critical role during this pandemic by continuing to work behind the scenes to ensure that hospitals, pharmacies, grocery stores, restaurants, and other essential businesses have the goods and supplies they need to keep going. In addition, many manufacturers have pivoted away from their normal operations and towards producing the critical goods frontline workers needed (masks, ventilators etc.), showing an incredible adaptability.

Our survey, “Close the Talent Gap: Pre-pandemic insights inform future workforce strategies in manufacturing” is focused on the idea that the industry’s most persistent challenge — its skilled-labor shortage — still requires attention, and several pre-pandemic workforce trends could be analyzed as a means to inspire new ways to attract talent from a much deeper pool of workers who might not have previously considered a career in manufacturing. 

A few key findings:

  • Pre-pandemic, 2 in 5 manufacturers were experiencing higher-than-average turnover (44%), a notable spike in retirements (40%), and feeling the financial burden of paying overtime to compensate for vacant positions (39%).
  • Despite best intentions to fill open jobs, nearly 2 in 3 manufacturers (62%) had difficulty recruiting skilled workers, reinforcing the seriousness of the talent gap.
  • While nearly half of manufacturers (47%) agree negative industry perceptions have impacted their ability to recruit Millennial and Gen Z talent, few have tackled the problem head-on.

Given these findings, UKG proposes four strategies to help close the manufacturing talent gap:

  1. Maximize the workforce: Workforce development and knowledge transfer initiatives were top of mind for hiring managers, as 3 in 5 organizations took steps to upskill (65%) and cross-train (58%) employees, while 1 in 4 offered apprenticeships (28%) or mentorships (26%).
  2. Embrace alternative talent: When unemployment was at its lowest, 4 in 5 organizations (81%) said they still managed to add skilled labor to the workforce by diversifying their candidate pool. Veterans were actively recruited by nearly three-quarters of manufacturers (73%), while other hiring managers sought out individuals with non-traditional skills or work histories (66%), second-chance workers (64%), individuals returning to the workforce (64%), gig workers (62%), refugees (56%), persons with disabilities (54%), and retirees (54%).
  3. Engage with analytics: According to survey respondents, people managers at their organization were using human capital management (HCM) software to measure employee potential (36%), asses productivity losses based on absenteeism (28%), pin-point root causes of employee turnover (28%), forecast skills gaps (27%), and asses flight risk (13%).
  4. Invest in the employee experience: Around 4 in 5 manufacturing organizations (81%) believe the workforce is a core component to achieving success in their digital transformation, and 9 in 10 (91%) understand investing in company culture can attract qualified candidates and retain valued employees – in fact, 87% were actively working to enhance their culture as of March 2020.

As we move through this global pandemic and many manufacturers return to a new normal, they’ll need to find new and innovative ways to solve their labor shortages and they will need to do this quickly or they’ll find themselves left behind. We hope this survey will provide them with meaningful information and ideas to do just that.

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