Manufacturing is making a resurgence in the U.S. and other countries around the world. According to the U.S. Bureau of Labor Statistics, there is a shortage of 550,000 stable manufacturing jobs to be filled in manufacturing businesses nationwide. There is no doubt the Skills Gap is in full force if you observe manufacturers offloading, prioritizing customers, and struggling to fulfill demand because of a lack of people. In union industries, employees are threatening strikes and across the board, wages are increasing which leads to intense inflationary pressures. It is a tricky time to navigate yet the best will figure out how to scale successfully.
The Resurgence Will Continue
The manufacturing resurgence will continue as businesses address extreme supply chain risk, unpredictable costs, the need to meet changing customer needs, and U.S. incentives ramp up. For example, Joseph P. Quinlan, head of CIO Market Strategy at Merrill and Bank of America Private Bank has described the current environment in the U.S. in a June 2023 market outlook report, as “the early stages of a manufacturing supercycle pivoting around renewable energy, electrical vehicles and batteries/charging stations, and semiconductors, in addition to rising spending in more traditional areas like ports, highways, grids, airports and the like.” As of April, spending on manufacturing construction — new factories was tracking at a $189 billion annual rate, triple the average rate in the 2010s ($63 billion).
In consulting with manufacturers how to leverage SIOP (Sales Inventory Operations Planning), supply chain management, and ERP to scale successfully, it is clear that there is plenty of scrutiny on make vs buy decisions (reshoring, nearshoring, offloading, expanding capabilities), customer and product profitability analyses, and strategies to scale successfully to meet customers’ requests and expansion plans. The resurgence will continue yet talent remains scarce.
Fulfilling the the Need for Expansion & Scale
There are several strategies smart manufacturers are pursuing to fulfill the need for expansion and scale as it relates to talent. The most successful include the following:
- Training & development: There is a renewed interest in training and developing employees to expand their skills and learn about new and advanced methods to perform their roles.
- Mentoring: One of the best ways to accelerate the learning process is to find a mentor. Mentors bring experience to the table and provide insights that cannot be found in a book. Exemplars can show the way forward. If you can entice experienced employees and retired employees to provide guidance, progress will be robust.
- Apprenticeship programs: Manufacturing thrives on apprenticeship type programs with on-the-job training with immediate feedback and corrective information.
- Automation, robotics & digitization of the supply chain: Only the successful will look for ways to automate whatever is repetitive, use robots for those tasks that can run through the night without interaction, and digitize the end-to-end supply chain to bring efficiency and to more quickly meet customer needs.
- 3D printing / additive manufacturing: Why produce what you can print upon demand? If an aerospace engine and a miniature house can be printed, what’s holding you back?
- ERP & related technologies: Every client can better use their ERP system to achieve results and automate mundane tasks. Prioritize utilizing this already-existing asset and expand the use with related technologies such as artificial intelligence (AI), IoT (internet of things), digital twins, AV/VR (audio visual/ virtual reality), and much more.
- Retention: Often, the most successful clients are simply those that retain key talent. It sounds easy, but it requires effective leadership, flexibility, investment into employees (training, cross-training, experiences, etc.), and competitive compensation. People follow people. People do not follow companies.
- Supplement your employees: We are not the typical supply chain consultants as we will jump into the details with a client and partner with key resources to bring results to fruition. More and more clients are pursuing this type of strategy to supplement their workforce by providing support to key talent while advancing their capabilities and ensuring results. To learn how to select a supply chain consultant, read our article.
As the manufacturing resurgence accelerates, the need for talent will increase. Employ key strategies to fulfill this demand for talent and address the Skills Gap. Please contact us with your success stories and your questions for how to succeed during these volatile times. And, please keep us in the loop of your situation and how we can help your organization get in a position to thrive for years to come. Learn more about these topics in our blog and download your complimentary copy of our recently released special report: The Road Ahead: Business, Supply Chain & The World Order