Key Points:
- The U.S. manufacturing industry is booming, reaching nearly 13 million jobs by January 2024.
- The manufacturing industry will need about 3.8 million new employees between 2024 and 2033, but around 1.9 million jobs may go unfilled if the skills and applicant gaps aren’t addressed.
- Manufacturers are investing in partnerships, improving the worker pipeline and the work environment, and boosting employee retention.
As the manufacturing industry expands, manufacturers are investing to attract and retain workers. The industry will need about 3.8 million new employees between 2024 and 2033. However, the workforce remains a challenge, with around 1.9 million jobs potentially remaining unfilled if the skills gap and applicant gaps aren’t addressed. How can manufacturers build the workforce they need? Some of them are driving growth with these workforce strategies:
U.S. manufacturing booms:
The U.S. manufacturing industry is booming, with employment surpassing pre-pandemic levels, reaching nearly 13 million by January 2024. Manufacturing establishments grew by over 11% between 2019 and 2023, nearing 393,000. In addition, construction spending on manufacturing facilities has almost tripled since June 2020, increasing up to 37% and hitting a record $225 billion in January 2024.
Despite shorter average lead times since the pandemic, the drive to invest continues as manufacturers aim to de-risk supply chains and build facilities closer to U.S. customers.
Indicators of growth:
As the sector works on a common goal to improve the supply chain resiliency, acquisition flexibility, workforce development, and technological preparedness over the next years, certain factors can be highlighted as indicators of the industry’s positive outlook:
- Recent legislation, including the Infrastructure Investment and Jobs Act (IIJA), the Inflation Reduction Act (IRA), and the CHIPS Act, has greatly fueled manufacturing growth.
- Nearly 300 new clean technology, semiconductor, and electronics manufacturing facilities are set to be completed by 2031.
- Current manufacturing projects represent over $430 billion in investment and are expected to create more than 234,000 new manufacturing jobs.
- The launch of the National Defense Industrial Strategy in January 2024 aims to drive investment and strengthen the defense industrial ecosystem.
Workforce remains a main challenge:
In December 2023, Deloitte and The Manufacturing Institute conducted their sixth manufacturing talent study in over 20 years. The study, which surveyed over 200 U.S. manufacturers, interviewed more than 10 senior executives, and analyzed labor supply and demand data, highlighted three key findings:
- Industry growth is driving the demand for workers across all levels, from entry-level associates to engineers.
- Evolving skill requirements now encompass technical manufacturing, digital, and soft skills.
- A shortage of applicants for both skilled and unskilled positions is prompting manufacturers to focus on talent retention.
In NAM’s Q1 2024 survey, over 65% of manufacturers identified talent attraction and retention as their top challenge. Workforce issues have consistently been a primary concern since 2017, driven by factors like declining population growth, lower labor participation, increased retirements, high turnover, and shifting expectations from younger workers, especially post-pandemic.
Despite some recent cooling, the labor market remains tight, and the applicant gap may persist, limiting manufacturers’ ability to fully capitalize on growth and investments. The study reveals the industry will need about 3.8 million new employees between 2024 and 2033, with around 1.9 million jobs potentially going unfilled if skills and applicant gaps aren’t addressed.
Rising demand for high-skill manufacturing roles:
Fast-growing manufacturing roles projected through 2032 align with the most in-demand skills in the past five years, according to the BLS. As products and operations become more complex, demand for highly skilled roles is expected to surge. Industrial machinery maintenance technicians, with over 270,000 employees in 2022, could grow by 16% in 2032, while mechanical and industrial engineers, with over 370,000 employees, could grow by 11% in the same period.
How manufacturers drive growth with workforce strategies:
So how can manufacturers seize growth opportunities despite talent shortages? The study shows that manufacturers are shifting to a more active approach by addressing skills and applicant gaps by investing in partnerships, strengthening the worker pipeline, improving work environments, and boosting employee retention. Here are three combined workforce strategies that help manufacturers overcome talent challenges and build the skilled workforce they need:
- Understanding evolving employee expectations.
- Applying a “customer focus” to workforce challenges to create a leading worker experience.
- Using an ecosystem approach to attract and upskill talent.
To learn more about how manufacturers are tackling these workforce challenges, stay tuned for Part 2! Click HERE to read the full article.
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At SoloPoint Solutions, we specialize in connecting manufacturers with highly skilled Mechanical, Electrical, and Manufacturing engineers who will help fill the gaps in your workforce. Contact us today to help you build the workforce you need: