Bridging the Skills Gap in Manufacturing with the Contingent Workforce | DCR Workforce Blog

Bridging the Skills Gap in Manufacturing with the Contingent Workforce

According to the Manufacturing ISM Report Economic activity in the manufacturing sector expanded in June for the 30th consecutive month.

Bridging the Skills Gap in Manufacturing with the Contingent Workforce

This is great news, but carries some concerns. According to the Manufacturing Institute, the industry is facing a skills gap which has left open nearly 600,000 domestic jobs. Manufacturing as an industry requires an industrial ecosystem which meets its need for resources. Skilled workers are at the top of these requirements. However, many of the current workers in manufacturing are heading for retirement and for many reasons, finding new workers does not seem to be an easy task.

Does it mean that the growth trajectory of the resurrected manufacturing industry will fail to attain its potential and plummet to a low level? Continued growth will require some strategic measures from the industry to counteract the negative pressures on finding the talent they need.

Factors Impacting the Need for Talent:

The manufacturing industry has experience waxing and waning demand of talent over the years. Some of the factors which have contributed to the emerging demand for manufacturing talent are enumerated below:

  • Increase in demand for products and services
  • Introduction of new advanced manufacturing technologies and automation
  • Strength of economy
  • Attractiveness of industry
  • Increase in availability of skilled positions
  • Introduction of flexible and complex work systems
  • Introduction of new advanced manufacturing technologies and automation
  • Loss of embedded knowledge due to movement of experienced workers
  • Re-shoring operations to the U.S.
  • Retirement of baby boomers
  • Less emphasis on trades in public education system

Manufacturing Jobs today:

Manufacturing may be seeing some unskilled jobs being outsourced overseas, but skilled workers are in demand for technical or factory floor jobs across the board in manufacturing. Technology changes at such a pace that there is always a lag between education and labor market requirements.

  • 21st century’s manufacturing jobs are not the infamous repetitive, mind-numbing assembly line jobs of yore. They are jobs in a high technology environment, which depends on people to control the computers which, in turn, control most of the work being done by mills, machines and robots.
  • These jobs pay well, and allow even a factory floor worker to grow into a key role in manufacturing engineering or in quality control
  • There is a need for an ongoing acquisition of skills through training programs arranged by the state and federal governments, educational institutes and business organizations.

A Win-Win:

For Business: Manufacturing companies have realized the value of contingent workers so much so that the manufacturing industry employs nearly half of all contingent workforces. It is interesting to note that both skilled and unskilled manufacturing roles are being filled by contingent workforces. By engaging contingent workforces through staffing agencies, which enjoy an access to established talent pipelines for the manufacturing industry, these companies save time when recruiting, interviewing and screening candidates. Another reason why contingent are highly utilized is that they can be brought on board to meet spikes in production, whether seasonal or to meet the deliveries on a big order. Companies may also choose to make workers permanent, using their contingent worker program as a testing program for new workers before investing in their training and benefits.

For the Worker: Skilled workers are paid well, as competition for highly skilled manufacturing talent results in high wages for permanent and temporary workers. The worker can be exposed to a new industry, expand their existing skill sets, gain experience and work on a flexible schedule. They have a better opportunity to gain permanent position, if they are so inclined and the employer’s need turns out to be long term. Even if the worker does not bring in the right skill set, the manufacturing industry is open to providing ongoing learning opportunities to acquire the needed skills, improving their prospects for career growth and ultimate success in the job market.

The pressures on the manufacturing industry to maintain a highly skilled workforce are making the industry depend heavily on contingent workers, as many of them possess industry-specific training. According to an estimate by Accenture, contingent workers comprise up to 33% of the U.S. workforce, whereas research by Ardent Partners expects the number to touch 45% by 2020. Manufacturing companies today are savvy enough to build a culture and employer brand that attracts both permanent and temporary workers and serves the needs of an extended workforce.

The content on this blog is for informational purposes only and cannot be construed as specific legal advice or as a substitute for competent legal advice. They reflect the opinions of DCR Workforce and may not reflect the opinions of any individual attorney. Do contact an attorney for advice specific to your issue or problem.
Lalita is a people/project manager with extensive experience in operations, HCM and training and development across industries like banking, education, business consulting, BPO and information technology. She believes in a dynamic approach to life and learning as change is the only constant.