WORKFORCE PIPELINE A MONTHLY FEATURE ABOUT TRAINING, EDUCATION & WORKFORCE DEVELOPMENT w H
A Smart Resolution: A Workforce Health Check According to The Boston Consulting Group (BCG), with-
ealthy resolutions are rampant this time of year. In our personal lives, we pledge to eat better, join the gym, and schedule an annual physical.
As we kick off 2015, now is also the perfect time to take stock of the health of your company’s workforce, and resolve to put time and energy into developing the most important asset you have: people. That is one of the secrets of world-class companies – those that excel operationally and financially. Research shows that what sets these companies apart from their com- petitors is an understanding of, and commitment to, investing in their employees, also known as “human capital.” While there are several components to developing human capital such as talent acquisition, performance management, rewards and recognition, success planning and process sys-
out aggressive action, the next decade is expected to bring a potential shortfall of 875,000 machinists, welders, industrial- machinery mechanics and industrial engineers. While the exact number of unfilled jobs is often debated, this shortage of human capital is impacting manufacturers to- day. Nine out of ten manufacturers are having difficulty finding skilled workers and they say this is directly hurting the bot- tom line, according to an SME survey. In fact, nearly 60% of the survey respondents said the gap in skilled labor impacted their company’s ability to grow.
This impacts our nation, too, as manufacturing is an important driver for the US economy and for the country to remain competitive. For continued growth, manufacturers must have access to skilled labor.
As we enter the New Year, we encourage manufacturers to take a free Workforce 2021 Readiness Assessment to determine their ability to face the growing talent gap.
tem design, one critical area is workforce development. The findings are clear: model companies are outperforming others in large part because they manage and train differently. With just 39% of manufacturers anywhere close to world- class manufacturing status, according to Tooling U-SME’s 2014 Manufacturing Insights Report, there are plenty of opportunities for manufacturers of all sizes to capture new productivity and profits through a focus on human capital.
The Skills Shortage To demonstrate the urgency of this focus on human capital to drive competitiveness, it is important to consider the dramatic existing and pending talent shortages. As pre- dicted, the skills gap is a major challenge for many manufac- turers, due to limited employee pipeline, a retiring workforce, reshoring and the changing pace of technology.
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With business success on the line, the choice to focus on training and development should be clear. For instance, a well-trained employee will more effectively utilize the ca- pability of new equipment, leading to increased innovation and productivity.
This is important as we see companies beginning to invest again in new equipment. According to a recent article in The Wall Street Journal, the average age of industrial equipment in the US has risen above 10 years, the highest since pre-World War II. With capital spending predicted to show improvements of 5.3% in 2015, it will be critical for employers to train workers on this new equipment to take advantage of technical advances for continued innovation.
Consider that BEST organizations—organizations recog- nized by the Association for Talent Development (ATD) that
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