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Upskilling Workers to Address Talent Shortages

April 3, 2024
Focus on the future of the business by responding to employees’ desire to improve, instilling new capabilities and creating a positive feedback cycle.

Manufacturers continue to navigate high inflation and supply chain disruption, another issue looms large as a top concern. According to a recent Protiviti survey on top risks in manufacturing, the challenge of attracting, developing, and retaining talent remains top of mind in 2024. As new employees enter the workforce, their expectations continue to shift. It’s imperative that manufacturers reflect these evolutions, as failing to do so risks them falling further behind.

Recent workforce data found that 61% of Gen Z respondents expressed a desire for more opportunities to increase responsibilities, and 76% sought more opportunities to learn or practice new skills, underscoring the group’s appetite for advancement and deepening skills across the talent base.

However, low unemployment in manufacturing and ongoing skills shortages make it increasingly challenging to staff at full capacity. The same Protiviti survey found that by 2034, talent management will become the single top issue. The mandate for manufacturers is clear: it’s time to focus on talent attraction.

Given the severity of this situation, it’s little surprise that a recent study conducted by Deloitte and The Manufacturing Institute concluded that the manufacturing skills gap in the United States could result in 2.1 million unfilled jobs by 2030, a figure that could potentially result in manufacturers losing $1 trillion in revenue opportunity cost by 2030.

As manufacturers search for new ways to attract, onboard, and retain valuable employees, outdated systems are among the largest barriers to efficiency. Manufacturers must mirror their talent attraction endeavors with their investment in the new and innovative solutions required to augment lower percentages of capacity. Upskilling and automation will be critical to shaping the future of manufacturing, and investing in both the requisite technology and cultural evolution will be key to positioning manufacturers for continued success.

Navigating upskilling amid innovative technology

The scale of the manufacturing skills gap and labor shortage is no secret, and yet problems persist. As manufacturers look to grow and scale over the next decade, they are doing so with a wary eye towards employment. As processes become increasingly automated and reliant on advanced technologies, the shortage of skilled labor impedes smooth adoption and integration of these tools.

Consequently, a disparity in skills can lead to a mismatch between available workforce capabilities and the demands of operating sophisticated machinery, troubleshooting technical issues, and adapting to evolving trends.

Addressing these concerns effectively requires a diversified approach, including investing in workforce development, competitive training programs, and exploring technological solutions that simplify operations and reduce dependency on highly specialized skills. Manufacturers also will need to consider more flexible hiring practices, such as upskilling existing employees or implementing apprenticeship programs to develop a skilled workforce from the inside out.

To remain competitive, manufacturers need to stay at the forefront of technological advancements. A lack of skilled workers can hinder a company's ability to innovate, adapt to new technologies, and implement efficient manufacturing processes, all of which can lead to a loss of competitiveness.

A learning culture in upskilling

Whether it’s new or existing employees, upleveling abilities to match evolving technology is a must. The investment in and implementation of tools that automate repetitive and mundane tasks must be done in tandem with training programs that allow employees to learn, and eventually move to a focus on higher value activities. Failing to do one or the other will leave a gap in manufacturers’ ability to mitigate the effects caused by labor shortages.

By leveraging technology to augment employee capabilities, manufacturers remove the monotonous and repetitive work that leaves workers frustrated and unfulfilled while increasing productivity. Investing in training programs and embracing technology allows manufacturers to navigate changing industrial demands while empowering their employees to thrive and take on leadership roles in the digital age.

Fostering a learning culture is a defining feature of manufacturers that will succeed in the long-term. By incentivizing employees to engage in continuous training and development, companies can cultivate a workforce equipped with the skills necessary to thrive in an increasingly automated environment, and reduce turnover rates by keeping them positively motivated and engaged. This will allow for more automation, and it will align with the desires of a workforce increasingly interested in learning.

According to a recent study on career development, 52% of workers said they need to learn new skills within the next year to continue their careers; while 46% of employees said they are not as skilled as they need to be. A desire to learn should be harnessed: manufacturers can upskill current employees and new hires by implementing targeted programs focused on developing knowledge in areas such as data analysis, programming, automated system maintenance, and problem-solving. Internally, workshops and mentorship opportunities help employees to stay informed on technological advancements and adapt to evolving roles within the manufacturing landscape.

Clear career growth pathways and incentivizing employees’ new skills meets the demands of a new workforce eager to learn, but positions manufacturers to augment automation with talented people.

It’s time to change. By being a manufacturer focused not only on the future of the business, but employees, talent attraction and upskilling can be a positive feedback cycle. Open communication channels allow employers to understand employee concerns and provide necessary support as they learn. Encouraging a two-way dialogue ensures that employees feel valued and empowered, ultimately fostering a collaborative environment conducive to continuous growth and innovation.

Invest to succeed now and prepare for the future

To stay competitive as manufacturing becomes more technology-driven, businesses should focus on training and upskilling, and on adopting technologies that can assist their workers. These actions help manufacturers to address the present skills gap and position themselves advantageously as manufacturing evolves. This will foster a culture of continuous learning and help attract and retain top talent. Early technology adoption is a strategic move that enhances productivity and adaptability, and future-proofs the workforce, creating a resilient and forward-looking manufacturing business that is equipped to overcome current challenges and prepare future leaders to succeed.

Matt Heerey is the president of ECI Software Solutions’ Manufacturing Division.

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