Many of these challenges are outside of manufacturers’ direct control. Take the uncertain political environment, which many believe is dampening economic growth. After lurching from one federal budget crisis to the next for the past few years, including a 16-day partial government shutdown in October 2013, Congress finally approved a two-year bipartisan budget deal before the end of the year that gives businesses more economic certainty—at least for the time being. The recent history of intense conflict and the cuts in the current deal still leave some uncertainty in the air about whether Congress can continue to work together in the future and avoid future shut- downs. Many businesses have complained that it has been difficult to plan and make investment decisions. “The last couple of years were really chaotic,” Marion Blakey, president and chief executive of the Aerospace Industries Association, told the Washington Post. Then there’s the workforce challenge. In 2011, the manu- facturing skills gap was estimated to be about 5% of the work- force, or 600,000 workers. In the past year, there had been some debate about the severity of this shortage, with some experts arguing that manufacturers simply need to pay higher salaries, even as study after study shows US students and em- ployees far behind their global peers in STEM knowledge. Practically speaking, many manufacturers continue to report that finding qualified workers is a top challenge. The
gap is only projected to widen in the coming years, especially because the manufacturing workforce is aging faster than any other sector of the economy. Roughly half of the manufactur- ing workforce is at least 45 years old, and as employers look to replace retiring Baby Boomers, qualified candidates simply aren’t there. This workforce shortage spans all levels of skilled employees, too, from welders and machine operators to man- agers and engineers.
“The US remains the growth driver in the industrial manufacturing sector, with continued signs of healthy demand, pricing strength, new product investment and hiring." -PwC
The consultancy PwC (New York, NY and London) said that most of the manufacturers it surveys as part of its quarterly Manufacturing Barometer reported hiring difficulty. “In a limited job market, it is troublesome that three-fourths of panelists have reported a skill gap, with half of those companies acknowledg- ing difficulty in filling these key positions,” said Bobby Bono, US industrial manufacturing leader, PwC. It is especially difficult to fill jobs, manufacturers say, when the technology being used on the shop floor is grow- ing in complexity, requiring manufacturing workers to know more than ever. In fact, the need to manage complexity in this array of new technology is a widespread industry challenge. Upgrading to the latest equipment and technology is consis- tently ranked as a top priority, but identifying which technolo- gies will have the biggest economic impact can be difficult. Some shops report not making back their investment on some machines before being asked to invest in the next big thing. Still, many know that they must upgrade to keep business and stay profitable in a fiercely global environment. Jeff Musgrove, President of Applied Fusion (AFI), a job shop in San Leandro, CA, that specializes in complex weld- ments for the aerospace, semiconductor and other critical sectors, said he’s constantly asking himself whether new technology investments are going to pay off and the answers aren’t always clear. “That question really has to be asked all the time,” he said.
Despite these challenges, the manufacturing industry as a whole is poised for continued growth and job creation. That’s
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ManufacturingEngineeringMedia.com | March 2014
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