In recent years, labor shortages have become a significant challenge for the US manufacturing industry. With the demand for goods increasing and the supply of available workers decreasing, many companies are struggling to fill positions and maintain productivity. This has led to concerns about the long-term viability of the sector and the impact of labor shortages on US manufacturing jobs. 

A recent report by Deloitte and the Manufacturing Institute (MI) projects that between 2024-2033 as many as 3.8 million additional employees will be needed as current workers retire, change careers and new roles are created in the manufacturing industry. The effects of labor shortages on US manufacturing jobs are significant. With fewer workers available, companies may struggle to meet production targets and fulfill orders, which can result in lost revenue and a decline in the industry's overall competitiveness. Additionally, the shortage of skilled workers has led to a lack of innovation and a slower pace of technological advancement. 

One of the main factors contributing to the labor shortage is an aging workforce. Many skilled workers in the manufacturing sector are nearing retirement age, and there are not enough younger workers to replace them. This has created a skills gap, with many companies struggling to find workers with the necessary experience and expertise to operate advanced manufacturing technologies. 

So, what can companies do to help alleviate the pain of the labor shortage? Attract and retain top talent using a variety of methods. 

Invest in Training 

To address the labor shortage in the manufacturing industry, companies are taking a variety of approaches. One of these is investing in training programs to develop the skills of existing workers and attract new talent. By having a robust training program, companies can upskill and cross-train their current workforce which can remedy issues when workers leave the company. This type of training allows for a diversity of work as well which can keep employees from getting bored with their jobs. Upskilling and reskilling employees also shows a commitment to their success that often leads to higher job satisfaction and lower turnover. 

Embrace Diversity, Equity, & Inclusion 

Companies are working to improve their diversity, equity, and inclusion (DEI) initiatives as a recent study by Deliotte and The Manufacturing Institute shows that focusing on DEI greatly effects the fill rate of open positions. By integrating DEI into all aspects of the company and training, not just one-off programs, companies can increase the rate in which employees feel they belong and are valued. This can help to boost creativity, increase employee engagement and retention and strengthen the decision-making process, all while emphasizing a commitment to social responsibility, which in turn can help companies attract top talent and enhance their reputation. 

Focusing on DEI will also help attract younger workers who have been shying away from the industry in recent years. In survey after survey, Millennial and Gen Z workers routinely put diversity as a top priority for where they want to work. Promoting and working on DEI efforts as well as touting the benefits of manufacturing careers to younger generations can help bridge the employment gap. 

Look Inward to Drive Culture Change 

The general lack of interest among younger generations in pursuing careers in manufacturing is having a negative impact on the industry. When you pair this problem with the fact that 41% of manufacturing workers are over 40 years of age and many are nearing retirement, this exacerbates the issues of an aging workforce. This is partly due to misconceptions about the industry, such as the belief that manufacturing jobs are low-paying or the work will not be fulfilling. Companies should take notice of what younger generations are looking for in their work and incorporate those facets into the company culture. Younger workers want the opportunity to have their opinions heard and acted on by company leadership and they crave meaning in their work. Companies that have a truly open line of communication to their employees and have a culture of philanthropy have a better chance at attracting and retaining this younger demographic. By focusing on and promoting a thriving company culture and meaningful work, Millennial and Gen Z workers will begin to take notice of open manufacturing positions.  

Hire (& Retain) Contingent Labor 

Many manufacturing companies are utilizing contingent labor these days, but it’s not just about getting people in the buildings, it’s about keeping them there. Many companies drop the ball right from the start with contingent workers by treating them differently from their own full-time employees. Creating that type of “us vs. them” culture only makes it harder to keep contingent workers from leaving the company in short order. Organizations need to embrace the importance of these employees and make them feel like they are part of the team from the beginning. Feeling a sense of belonging goes a long way to making someone feel happy at their job and wanting to stay.  

Overcoming the Challenges 

Labor shortages are a significant challenge for the US manufacturing industry, and their effects on manufacturing jobs can be far-reaching. However, by investing in training, recruitment, culture, and diversified hiring practices, the industry can overcome these challenges and continue to play a vital role in the US economy.