Industry, competing with distribution, struggles to attract labor

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Hiring has been a problem for manufacturers in the United States for years. When Deloitte last looked at the issue in 2018, low unemployment was highlighted as part of the problem. But a new manufacturing hiring report found the problem persisted in 2020, a period of high unemployment during the pandemic.

“Fast forward three years and, in the midst of a global pandemic and the first US recession in more than a decade, it looks like the same title is making headlines,” Deloitte wrote in its latest report on the lack of skills in manufacturing.

Between December 2020 and February 2021, the Manufacturing Institute and Deloitte surveyed more than 800 U.S. manufacturers and asked them about hiring. They found that manufacturers struggled to fill 46% of vacancies due to a skills mismatch – a 12 percentage point increase from 2018.

For manufacturers, hiring is getting harder and harder

Share of vacancies that manufacturers struggle to fill due to skills mismatch

One of the jobs that manufacturers find it hardest to fill is what the report calls “miscellaneous assemblers and manufacturers,” which are entry-level positions that don’t actually require a lot of training. The problem is growing competition, according to Paul Wellener, one of the report’s authors and the U.S. industrial and construction products leader at Deloitte.

“This is in part, we think, because of the increased demand for warehousing and distribution jobs,” Wellener said.

Entry-level jobs in manufacturing often pay well above minimum wage, according to the report, which notes that the average salary for shift fitters in the United States is around $ 15.55. But the pay might not be enough to help overcome what Wellener said could hold back hiring in manufacturing: an image problem.

“There is this image of dark, dirty and dangerous manufacturing beings,” he said. “I think it’s something that manufacturers need to keep working on changing.”

While careers in distribution have their own image challenges, they haven’t faced similar hiring challenges. Employment in warehouses and in the manufacturing sector fell in the first months of the pandemic. But warehousing employment levels have surpassed pre-pandemic levels to set all-time highs at the end of 2020. Manufacturing, meanwhile, is still well below its levels. pre-pandemic job.

“I don’t know if distribution companies necessarily have the same image issues; they can have different image issues,” Wellener said.

Another problem that makes hiring difficult is the skills that manufacturers are looking for. Wellener noted that research found that the number of times that manufacturing jobs listed skills, such as analytics, increased 82% above the base growth of all manufacturing jobs.

Labor availability has been added to a list of issues currently facing the industry.

“We have performed well despite the difficult operating environment which requires difficult labor availability, significant inflationary pressures on raw material costs, global supply chain challenges and changing demand. “Tyson Foods chief financial officer Stewart Glendinning said on an earnings call Monday.

The Institute for Supply Management’s manufacturing report showed that supplier deliveries were slowing throughout the pandemic, which ISM Manufacturing Business inquiry committee chair Timothy Fiore partially pinpointed to fuel shortages. labor in supplier companies.

To attract workers, the manufacturing sector will need to attract people leaving high school, the military, business programs and colleges, Wellener said. But one problem the report found is that apprenticeship programs in the manufacturing sector are largely concentrated in the Midwest, while job opportunities expected for the industry over the next decade are expected to be concentrated elsewhere, in particular. especially in Texas and California.

“We have a mismatch between the pipeline and the needs,” Wellener said.

This story first appeared in our weekly newsletter, Supply Chain Dive: Operations. Register here.



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