Lisa Anderson was quoted in Manufacturing Dive about how manufacturers can navigate a slowing economy.
Big brands are laying off workers amid lagging demand. But experts say there are more strategies that can help keep teams nimble for an economic turnaround.
As the economy stagnates and global factory activity remains slow, some manufacturers have taken drastic steps to quickly cut down on costs by laying off workers and closing facilities.
Stationary bike maker Peloton’s manufacturing subsidiary Precor announced in March that it would close its factory in North Carolina and lay off more than 100 employees.
U.S. EV manufacturer Lucid said it would lay off about 18% of its overall workforce last month, and Solo Cup manufacturer Dart Container Corp. laid off 84 workers. The tools-maker Stanley Black & Decker said it would close two facilities in Texas and South Carolina, too.
Manufacturers are making these decisions as consumer spending — which surged during the pandemic — returns to past norms and demand slows.
Still, headlines about layoffs and factory closures may not fully reflect the current state of U.S. manufacturers, said Chad Moutray, the chief economist at the National Association of Manufacturers. Despite concerns about a potential recession, Moutray argued that manufacturers are coming off a remarkably successful few years and that the current surge in layoffs isn’t particularly centralized in the manufacturing sector.
the shortage of skilled workers may be a reason to avoid layoffs and hold on to as many permanent employees as possible, said Lisa Anderson, founder and president of the supply chain and manufacturing consulting firm LMA Consulting Group. While manufacturers are understandably nervous about the impact of declining orders on their bottom line, there are also other strategies to prepare for a slower economy, she explained.
Originally published in Manufacturing Dive, April 18, 2023