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Gap or Opportunity? Manufacturing Skills for a Supply-Chain Disrupted World (Quality Digest)

It’s time to lean into smart technology to help close the skills gap.

This article was originally written for and published by Quality Digest.

The manufacturing industry is at a make-or-break point. An underqualified workforce coupled with a disruptive pandemic has made it difficult for companies to attract top talent. Manufacturers are having trouble filling open roles with employees who possess necessary skills to carry out the desired work. Often referred to as the “skills gap,” it’s a significant problem.

A study by Deloitte and the Manufacturing Institute found that the skills gap could result in 2.1 million unfilled manufacturing jobs by 2030. This could have a substantial negative effect on the U.S. economy, and the absence of workers could be setting the manufacturing field back by decades.

The coronavirus pandemic was a black swan event that contributed significantly to this problem. According to the National Association of Manufacturers, the nation lost roughly 1.4 million manufacturing jobs at the beginning of the pandemic. While leaders are working to rehire, 77 percent of those surveyed said they will have ongoing difficulties in attracting and retaining workers, and that finding the right talent is now 36-percent harder than it was in 2018. The skills gap appears to be a long-term challenge. If leaders don’t take reskilling the workforce and implementing strategic plans seriously, the manufacturing industry could be on the brink of failure.

Invest in systems to teach the current workforce

Manufacturers use automation every day, proving that the smart manufacturing revolution is not only upon us but also expanding at a rapid pace. In fact, a 2020 report found that the smart manufacturing market is projected to grow from $252.29 billion in 2019 to $422.88 billion by 2025. Employee skills must match the needs of industry’s evolving demands.

Smart manufacturing still requires a high level of human oversight, so the employee talent pool remains a key to success. Attracting workers with the necessary skill set is a substantial challenge in today’s marketplace. Leaders covet workers with a wide and overlapping band of knowledge. For example, employees with an understanding of the internet of things (IoT), artificial intelligence, and robotics, in addition to engineering and equipment management, are highly sought.

When a diverse skill set is lacking, reliance on reskilling the current workforce can provide a viable solution—especially for emerging companies that are trying to make a name for themselves among larger market leaders. This strategic business move enables smaller companies to hold onto valuable employees by giving them incentives to learn new skills. Reskilling your employee base to address key technology innovation such as machine learning and artificial intelligence can mean the difference between struggling to survive and flourishing. Leveraging online learning tools like Salesforce Trailheads, Udemy, and Pluralsight is an easy way to bring much-needed technology expertise into your organization affordably.

A recent research report from the World Economic Forum and PwC reported that investment in reskilling and upskilling of the current global workforce has the potential to boost GDP by $6.5 trillion by 2030, while investing in future-ready education for today’s generation of schoolchildren could add $2.54 trillion over the same period.

But there is another way to tackle the issue—by leveraging low code/no code and composable architectures to help reskill the workforce. A low code/no code platform refers to automated code generation through interfaces like a drag-and-drop menu. Composable architectures create a software system made up of independent components that can be added or removed easily. The use of solutions like these takes robust technology and puts it in the hands of everyday users to help them easily develop quality products. A recent report from industry research firm Gartner speaks to the advantage of this process in its July 2022 “Market Guide for PLM Software in Discrete Manufacturing Industries.” The report states, “Composable architectures work best with open APIs and low-code application platform visual environments that enable enterprise developers and citizen developers to drag and drop application components, connect them, and create mobile or web apps.”

Leaders need to emphasize employee training and strategically invest in systems that make educational resources available for all. Existing workers may be more inclined to stay at a company longer if they see a clear path forward with upward momentum, enhanced learning, and occupational growth. Having a system in place where employees can access resources to foster their own education will make it easier for leaders to retain and attract talent.

The true cost of losing highly skilled employees

The increase of highly skilled workers reaching retirement age is putting a huge strain on manufacturers, and many are forced to lure top talent by paying a hefty price tag. Smaller manufacturers with tighter budgets are often most affected because they’re unable to afford the high salary requirements and are forced to make tough business decisions to compete effectively.

So how can companies lean in on technology when skills are harder to find or cost-prohibitive? In situations like these, companies can leverage technology to improve quality and reduce the risk of quality escapes. With quality management software solutions available today that accurately document processes across engineering, manufacturing, and the supply chain, processes don’t need to walk out with your senior quality engineers when they receive their gold watch. Technology provides an easy way to digitally document best practices, enabling manufacturers to determine how specific actions and reactions can affect all areas of the business and, most important, the bottom line. These solutions can also help manufacturers analyze data from across the supply chain to identify areas for improvement and optimize processes for greater efficiency and quality.

When companies centralize processes across the organization, they not only harness best practices of their industry but also provide fast and easy access to vital documentation across the business as a whole to ensure future success. With the business landscape shifting from a full-time, in-office model to a hybrid or remote workforce, the manufacturing industry, like many others, needs to address this seismic shift to support new work environments. Information sharing among this diverse employee backdrop is a new challenge for many. Technology streamlines information sharing and protects data intelligence throughout the organization within these new workforce parameters.

Redefining manufacturing to challenge how we innovate

Years ago, manufacturing breakthroughs like the Model T were highly innovative, introducing generations of firsts—some with the “it” factor to entice skilled employees, and some that may not have had the same cutting-edge impact. Fast forward to today, where digital technology is making leaps ahead of where we were just a few years ago in areas like robotics and 3D printing, and suddenly the manufacturing world is getting its swagger back. In fact, looking at MIT’s Supply Chain Excellence Awards that recognize outstanding undergraduate supply chain and/or industrial engineering majors, we see an interesting trend. In 2013, only two students were awarded graduate tuition fellowships, but that number jumped to 26 just ten years later. Another positive sign for future engineers and scientists comes from the National Science Board, which reports the number of undergraduate science and engineering degrees increasing from 400,000 in 2000 to just under 725,000 in 2019.

Upcoming generations offer a fresh perspective: They represent a digital-first mindset where user experience drives change. They want one convenient source of information that is reliable and accurate for all their technology needs. To lure them in, manufacturing job opportunities need to mirror how potential employees use technology in their personal lives. Simple, easy-to-use software is a must. If manufacturers can showcase how their operations align with this innovative perspective, they can pique the interest of recent grads and younger workers.

Tomorrow’s engineers have grown up with technology and interconnected systems, and when employers carry that mindset into the workplace, they will witness an uptick in interest for specific job skills. Could future roles, like new product strategist or operations technologist, address some of today’s manufacturing disconnects, like closing the gap between product concept (design/engineering/quality) teams and customer delivery teams (marketing/sales)? Developing a collaborative, digital-first approach to the manufacturing skill set could easily ignite sparks of interest among existing and new employees.

Today’s manufacturing skills gap is at a crossroads. Now is the time to seize opportunities and embrace the power of technology to inspire a new generation of skilled workers.

Check out the article "How ERP Became an Endangered Species" for more insights from Ray Hein, chief strategy officer at Propel Software.

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Ray Hein
Founder & Board Member, Propel

Ray is a SaaS veteran with 20+ years of PLM, development and product launch experience in both hardware and enterprise software organizations. Ray has held multiple executive positions at companies such as Agile Software, Apttus, Vendavo and Centric Software.

Fun Fact: Ray volunteers about two weeks a year with organizations like the American Diabetes Association, Family Giving Tree and Second Harvest Food Bank.

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Ray Hein