Published On: May 9th, 2023Categories: Manufacturing Labor Shortage

If you’re in the manufacturing industry, then you’re well aware of the ticking time bomb that is the manufacturing skills gap. 

The industry is grappling with an unprecedented labor shortage—a challenge that affects not only individual businesses but also the broader economy, with the threat of a staggering 2.1 million jobs going unfilled by 2030, potentially costing the U.S. economy a whopping $1 trillion. 

The study’s alarming findings are based on online surveys of over 800 U.S.-based manufacturing leaders, interviews with executives across the industry, and economic analyses. Collectively, they reveal a worrying picture of the manufacturing labor shortage. Even before the pandemic, the NAM’s quarterly outlook surveys identified the lack of skilled labor as the industry’s primary challenge, and this study from Deloitte highlights that it remains a significant concern today.

As the skills gap widens and the aging workforce moves into retirement, manufacturers must find innovative ways to attract and retain talent. But where to begin? 

In this blog post, we’ll delve into the root causes of the manufacturing labor shortage and provide a comprehensive understanding of the issue at hand. Plus, we’ll explore both simple and innovative strategies to address this pressing challenge, including attracting and retaining talent, embracing automation and technology, and fostering government and industry collaboration.  

Unraveling the Complex Factors Behind the Manufacturing Labor Shortage 

To no surprise, the manufacturing labor shortage has been exacerbated by the COVID-19 pandemic. About 1.4 million U.S. manufacturing jobs were lost during the early days of the pandemic, setting back the manufacturing labor force by more than a decade. While the manufacturing industry managed to regain 63% of the jobs lost during the pandemic, 570,000 positions had not been added back by the end of 2020, despite a near-record number of job openings in the sector. 

And even now in our post-pandemic world, ongoing related disruptions have led to manufacturers facing multiple staffing challenges with unclear solutions. Some manufacturing firms report higher turnover due to vaccination requirements, while others see minimal impact from these mandates. Many parents have had to leave work because of childcare interruptions, and other employees have left during the pandemic out of fear for their safety, burnout, or even the illness itself. 

But This Labor Shortage Goes Well-Beyond the Pandemic… 

COVID-19 is not the sole cause of the manufacturing labor shortage, even though it dominated the headlines for quite some time.  

The issue predates the pandemic by a decade, with the “great retirement” of baby boomers driving an exodus of workers from the industry. Manufacturers have struggled in particular to fill manager-level roles, while many younger workers have been drawn to other industries, such as technology and healthcare. 

As manufacturing has evolved to incorporate more state-of-the-art technology, like collaborative robots working alongside human workers, the demand for higher levels of education and new skills has increased. This shift raises barriers to entry for those without proper training or preparation. 

To compound the problem, the labor shortage extends beyond the manufacturing sector, affecting the supply chain that links materials, manufacturers, and markets. Trucking jobs have increased by 30% from pre-pandemic levels, but there remains a shortage of approximately 80,000 drivers nationwide. In response, several states have proposed lowering the minimum age for truckers from 21 to 18. While this would increase the pool of available workers, the influx of younger and less experienced drivers may also pose safety risks. 

Regardless of the reasons for the manufacturing labor shortage (albeit important), as we gain a deeper understanding of the multifaceted factors contributing to this reality, it becomes even more crucial to explore effective strategies that can help businesses attract and retain the skilled workforce they need to thrive in this competitive industry.   

Winning the Talent Game: Innovative Approaches to Attract and Retain Skilled Workers 

Despite the challenges posed by the manufacturing labor shortage, industry professionals should remain hopeful, as there are both simple and innovative strategies available to attract and retain top talent, ensuring a bright future for the sector. 

A word of warning: These tactics might sound too obvious to be effective, but sometimes, simple and straightforward really does take the cake. Bonus: You can implement them almost immediately. 

Simple Hiring Strategies You Can Implement Immediately 

  1. Craft comprehensive and precise job descriptions
    Ensure that your job postings encompass the expectations, specialized equipment requirements, and necessary tasks for each position. And be sure to provide an overview of the company culture and emphasize the significance of safety throughout the organization. 
  2. Pinpoint essential traits for successful candidates
    For crucial roles, manufacturers should determine the skills and background that an ideal employee would have. Then, use this information to proactively recruit candidates with these attributes, rather than waiting to review applications to identify potential fits for the job.
  3. Invest in training for promising candidates
    During a shortage of qualified applicants, manufacturers may consider candidates who don’t yet have all the technical expertise but demonstrate the aptitude and eagerness to learn once hired. Apprenticeships and on-the-job training can effectively bring workers up to speed and prepare them for success. 

Need to kick your hiring and retention game into higher gear (beyond the basics)? We’ve got you covered.

Leverage the Power of Automation and Technology 

There’s no going back—automation and technology are here to stay, and identifying areas for automation within the manufacturing process can help alleviate labor shortages and improve efficiency. By embracing these advancements, businesses can find ways to complement their workforce and streamline their operations.  

Investing in advanced technologies, such as machine learning and robotics, can optimize operations and reduce the reliance on manual labor. These investments can also attract tech-savvy job seekers who want to work in a cutting-edge environment. 

Additionally, promoting human-robot collaboration is another essential aspect of integrating technology into the manufacturing process. Incorporating collaborative robots that work alongside human workers can raise the bar on efficiency and productivity while still maintaining a human touch—a real win-win, if you ask us. This collaboration enables employees to focus on tasks that require creativity, critical thinking, and problem-solving, while robots handle repetitive or physically demanding tasks. 

But don’t forget: Upskilling workers to manage and work with automation is vital for a smooth transition and integration of technology. Providing training and resources to help employees adapt to new technologies is a key component to preventing job displacement and fostering a sense of security.

Government and Industry Collaboration 

Manufacturers can also benefit from government and industry collaboration. Developing public-private partnerships is a powerful way to foster innovation and address workforce challenges. By working together, businesses, educational institutions, and government agencies can create comprehensive solutions that benefit the entire industry. 

Expanding workforce development initiatives, such as apprenticeships and training programs, is another essential aspect of addressing the labor shortage. These programs prepare workers for the evolving manufacturing landscape, ensuring they have the skills and knowledge necessary to excel in the industry. By promoting manufacturing education and training programs, businesses can raise awareness about the exciting opportunities available in the sector and attract more job seekers. 

Lastly, addressing visa and immigration policies to attract skilled foreign workers is another potential solution for the labor shortage. In fact, about 1 million of the 2 million potential immigrants who were lost during the pandemic were college educated, according to the UC Davis research. These workers would be considered “high-skilled workers,” potentially coming to the US on H-1B specialty visas. By making it easier for manufacturers to bring in qualified workers from other countries, businesses can boost the talent pool and fill critical skills gaps.

Facing Labor Shortages in Your Facility? LSI Staffing Has the Solution. 

Addressing the manufacturing labor shortage is a critical challenge for businesses and the economy as a whole. By implementing forward-thinking solutions, such as improving the industry’s image, offering competitive compensation and benefits packages, focusing on employee engagement and well-being, embracing automation and technology, and promoting government and industry collaboration, manufacturers can strengthen their workforce and ensure long-term success. 

But all that is easier said than done, especially if you feel like you have to go about it alone. (Spoiler alert: You don’t). 

LSI Staffing has tripled its growth in the last two years alone—meaning, you can count on us to solve your staffing challenges, no matter where you’re located. 

In today’s tight job market having the right staffing partner can make all the difference. We know how frustrating it can be to work with unresponsive staffing companies and be forced to operate your business under capacity. That’s why we build long-term partnerships with our clients to solve their unique staffing challenges and provide real-time solutions. Our unique high-touch model offers engagement and support to both employers and job seekers, resulting in a no-hassle, on-demand hiring experience you can trust.  

Together, we can rise above the labor shortage and build a brighter future for manufacturing. Contact us today to learn how we can help you hire better, faster.