OUTPLAYING THE

MANUFACTURING SKILLS GAP:

ATTRACTING, RECRUITING & RETAINING
TOP TALENT
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INDEX

03
Introduction: Talent Shortage

05
Automation Disrupts the Workforce

07
A Menacing Skills Gap
Skills Deficiencies
Developing the Right Skills

10
A Much-Needed Change in Reputation

12
Attracting Top Talent

14
Recruitment Strategies

17
Retention Strategies

19
Final Thoughts
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INTRODUCTION: TALENT SHORTAGE

The Manufacturing Skills Gap is not another trendy buzzword but a fact.
Sixty-seven percent of manufacturing executives say the industry is facing
a moderate-to-severe shortage in the availability of skilled workers and 56
percent expect it to get worse in the next three to five years, according to a
survey conducted by The Manufacturing Institute and Deloitte Consulting. At
least 5 percent of the available jobs go unfilled because of a lack in qualified
candidates.

A highly skilled, flexible workforce is not just ideal but a real factor in the
present and future health of the U.S. manufacturing industry, more important
than new product innovation and increased market share because of its role
in innovation and expansion, according to the respondents to the survey.

There was a time when anyone with a high school education could show
up at a manufacturing plant and get a job. Those times are no more.
Attracting and retaining skilled talent has become increasingly difficult in a
highly competitive, digitalized global marketplace occupied by job-hopping
millennials. At the same time, manufacturers efforts to develop the talent
they already have are falling short—a double whammy for the industry.

With technology evolving at a head-spinning pace and constantly pushing

other industries to the edge, it is easy to quickly fall behind and stay behind.
Filling jobs that have a greater impact on company performance—skilled
production jobs such as machinists, operators, craft workers, etc.—and
training existing workers to do those jobs should be a top priority for U.S.
companies.
AUTOMATION
DISRUPTS THE
WORKFORCE
 5

AUTOMATION DISRUPTS THE WORKFORCE

Rapid changes in technology and automation have kept the global workforce
in constant flux for decades. Almost half, 49 percent, of tasks people are
paid to do have the potential to become automated, with manufacturing
jobs having a 60 percent automation potential, according to “A Future That
Works: Automation, Employment and Productivity,” a 2017 report by the
McKinsey Global Institute.

Increased automation demands a more skilled workforce. Workers who can

operate and maintain modern tech systems are in high demand and are paid
more—6.7 percent more, according to the ADP Workforce Vitality Report 3Q
2017. Meanwhile, traditional manufacturing workers are leaving the industry
and watching their wages drop by an average 2 percent at their new jobs.

Employers are facing the difficult task of finding new, highly skilled talent and
retaining quality employees in a tightening labor market that is projected to
have a worker shortage of 2 million by 2025. This growing manufacturing
skills gap calls for innovative hiring and retention strategies.
A MENACING
SKILLS GAP
 7

A MENACING SKILLS GAP

As technology’s role in manufacturing processes increases and experienced

employees eligible for retirement leave the workforce, companies struggle
to hire workers who have specialized industry skills, and the manufacturing
skills gap expands.

Over the next decade, nearly 3.5 million manufacturing jobs will need
to be filled in the U.S.—about 2 million will remain unfilled, the Deloitte/
Manufacturing Institute survey showed.

Swiftly evolving technology not only requires new skills, but it also shortens
the shelf life of those same skills, widening the gap and emphasizing the
need for ongoing training. Manufacturers that develop their talent through
consistent training and career support have a competitive edge.
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SKILLS DEFICIENCIES

Despite recruiting efforts, as many as six out of 10 manufacturing positions

go unfilled or are not filled in a timely manner, forcing companies to hire less
qualified workers. Below are the most serious skills deficiencies according
to 450 manufacturing executives surveyed by professional services firm
Deloitte and the Manufacturing Institute in 2015.

TECHNOLOGY AND COMPUTER SKILLS 70%

MATH SKILLS 60%

69%

BASIC TECHNICAL TRAINING 67%

DEVELOPING THE RIGHT SKILLS

Deloitte and the Manufacturing Institute recommend manufacturers take the

following steps to develop their talent pool:

• Build a pipeline of young workers by engaging early in science,

technology, engineering and math (STEM) initiatives.

• Create a communications strategy to attract job candidates.

• Avoid focusing too much on job candidates’ specific skills and

experience. Consider their competencies and potential.

• Create a culture of employee development and growth by

tapping candidates within the organization.

• Build an integrated training strategy, and train managers to

support a culture of continuous learning.
A MUCH-NEEDED
CHANGE IN
REPUTATION
 10

A MUCH-NEEDED CHANGE IN REPUTATION

In the 1970s and 80s, factory shutdowns left millions of Americans

unemployed and entire communities and cities looking like ghost towns—an
imagine hard to forget.

Parents who recall these tragic events tend to discourage their children
from pursuing careers in the manufacturing industry. In a Deloitte/
Manufacturing Institute study, manufacturing ranked last as a career choice
among millennials, after technology, healthcare, financial services, retail,
communications and energy. Increased automation and outsourcing also
are scaring job candidates away as the manufacturing workforce shrinks to
a third of what it used to be.

To invigorate the manufacturing industry, these fears have to be addressed.

Tours to manufacturing plants, equipment and machinery workshops,
apprenticeships and internships are some of the initiatives manufacturers
can implement to improve the industry’s reputation and attract quality talent.
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ATTRACTING
TOP TALENT
 12

ATTRACTING TOP TALENT

Competition for skilled workers in the manufacturing industry is fierce,

yet many manufacturers are using outdated human resources tactics that
fail to reach the right candidates. Furthermore, many have neglected the
importance of company culture, career development, work-life balance and
other aspects of employment that job seekers value.

To lure in top talent, manufacturers need to market their brand and

company culture effectively. Core values, vision and mission are important
to millennials, as most of them seek to make a difference, be valued and
achieve personal and professional growth. A compelling website, targeted
social media presence and community involvement are key to captivate
them.

Attracting skilled workers is just the first step. Recruiting and retaining them
can prove as challenging as getting their attention.
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RECRUITMENT
STRATEGIES
 14

RECRUITMENT STRATEGIES

Recruiting skilled manufacturing workers is a timely and resource-consuming

process that can take months, but there is no way around it. Without skilled
talent, companies simply cannot survive.

Here are 11 strategies manufacturers can use to boost their recruitment

efforts:

1. Broaden your search to include women, veterans, the long-term

unemployed and other groups.

2. Use social media to reach, engage and attract the right

candidates. Speak their language.

3. Go where the candidates are: industry conferences, trade

groups, etc.

4. Identify the characteristics that make a successful candidate

and pursue those.

5. Set up an employee referral bonus program. The best employees

are found via referrals.

6. Write accurate and realistic job descriptions. Do not embellish

or exaggerate.

7. Be willing and able to train promising candidates through

mentorships, apprenticeships, etc.

8. Partner with the local government and community colleges to

develop a skilled workforce.
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RECRUITMENT STRATEGIES

9. Establish knowledge-transfer programs to pass skills from

retiring workers to new ones.

10. Consider using a recruiting firm that specializes in manufacturing

jobs.

11. Talk to your top performers to learn what motivates them, what
they like about their jobs, what they wish they could change,
etc., and use that knowledge to improve your company culture
and standing among candidates.
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RETENTION
STRATEGIES
 17

RETENTION STRATEGIES

After you attract the right workers and recruit them, how do you keep them
from leaving? By engaging your employees and showing them—not just
telling them—that you value them.

Retaining highly skilled manufacturing workers in a tight labor market can be

an uphill battle, hence the need for strong retention programs that encourage
employees to stay where they are.

Following are 11 strategies manufacturers can put into practice to retain

their talent:

1. Ask your workers what they need, and give it to them whenever
possible.

2. Design an adequate onboarding program for new hires.

3. Establish a clear career path for each worker from day one.

4. Provide ongoing training and education programs.

5. Offer opportunities for personal development and career

growth.

6. Be transparent and honest with your workers about your

business.

7. Train your workers to partner with automation—improve their

computer and technical skills.
 18

RETENTION STRATEGIES

8. Keep your employees happy with competitive pay,

comprehensive benefits, flexible hours, etc.

9. Reward good performance with bonuses, awards, free tickets,

parties, scholarships, etc.

10. Provide a safe workplace by complying with OSHA regulations

and offering safety training.

11. Create opportunities for community involvement and corporate

social responsibility programs.
 19

FINAL THOUGHTS

The manufacturing industry is facing a labor shortage and a skills gap, but so
are several other industries. Like the others, manufacturers have to employ
innovative, modern methods to attract, recruit and retain quality talent. They
must also invest in existing employees through retention programs that
include ongoing training.

Start by finding out what your ideal job candidates and current employees
want and need. Nothing else you do will matter if you neglect to meet the
needs and wants of the workers you are seeking to attract and keep.

Sources: The Manufacturing Institute, Industry Week, Society for Human Resources Management, The Business Journals,
HR Magazine, U.S. Bureau of Labor Statistics, ADP Research Institute, When Work Works, Families and Work Institute,
McKinsey Global Institute, Deloitte Consulting, Bloomberg.
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