As we touched on in two previous blog posts, the future of the manufacturing industry looks promising, both nationally and locally. This growth is, in many ways, a result of talent-driven innovation. However, the industry faces an impending setback: the shortage of that skilled talent; manufacturers are having trouble filling jobs.
In a 2015 nationwide survey, Deloitte and the Manufacturing Institute found that the skills gap in manufacturing is indeed widening and may reach a crisis point in the next decade. Worryingly, this gap covers a range of manufacturing positions—machinists, operators, craft workers, distributors, engineers and more—which hugely impact performance. This blog post examines that crisis, what it could mean for Indiana and the U.S. and ways to combat the problem.
According to the study, by 2025, 3.5 million manufacturing jobs will be available, and 2 million of those jobs will go unfilled due to the skills gap. Even at the time of the study, six out of ten open skilled production positions were unfilled, and it took over 90 days to find a qualified worker.
This talent crisis is a result of three key factors:
- 2.7 million baby boomers are projected to retire in the next decade.
- Economic expansion is creating new jobs in the industry.
- Fewer young professionals are entering the industry, and those who do not have sufficient skills to meet today’s advanced manufacturing requirements.
As the national leader in steel production, Indiana will continue to feel the effects of these troubling trends. In the state, 1.1 million job vacancies are projected for the decade; 60% of those jobs will require a postsecondary education (whether at a university or at a trade school), and 38% will require at least an associate’s degree. In addition, the Alliance for Science and Technology Research in America (ASTRA) reported that Indiana will have 123,000 STEM-related job vacancies this year, while the National Skills Coalition found that, by 2020, Indiana will have 550,000 middle-skill job openings.
Indiana’s educated population is simply not meeting these demands. Technical programs demonstrate high enrollment rates but poor completion rates. In addition, Indiana experiences a “brain drain”: large numbers of bachelor’s degree recipients migrate to other states, while graduates of less-demanding programs move here to replace them. The state and the nation continue to struggle with this deficit of trained, skilled workers, and the situation will worsen without corrective action.
Narrowing the Gap
Some ongoing efforts to meet this critical need have been launched. The Central Indiana Corporate Partnership created an initiative, Ascend Indiana, to identify employer needs, connect workers with training programs and funnel trained workers to employers. Some state legislation has been passed to address the situation. During the 2013 session, the Indiana legislature unanimously passed a bill forming the Indiana Works Councils and Indiana Career Council to better align education and workforce requirements. Nationally, apprenticeship programs have been expanded.
Additionally, there are some strategies manufacturers can adopt to help cultivate a new skilled workforce and close this gap:
- Development of internal employee training
- Involvement with local education systems and training programs
- Promotion of external training and certification programs
- Creation of veteran hiring programs
Reports have shown that manufacturing companies that initiate training and hiring programs and engage with local education systems experience less strain from the skills gap.The goal of these initiatives is to reach candidates across all areas by helping current employees acquire new skills and fostering an interest in potential workers across all age groups and education levels. Essentially, we must create the workforce we need.
For more information on careers with Mainstay Manufacturing, click here.