Manufacturers ‘struggling’ with Skills Shortage
USA Today and Yahoo News reported this week (http://news.yahoo.com/s/usatoday/20061205/bs_usatoday/usmanufacturersgettingdesperateforskilledpeople) that US manufacturers are struggling to find skilled laborers to do the hard work of manufacturing. And this is despite the reported millions of lost manufacturing jobs in recent years.
It appears from the article that many US manufacturers are struggling to find qualified laborers in welding, electrical, or machining. Simultaneously, reports journalist Barbara Hagenbaugh, manufacturing employment in highly skilled, technology-focused jobs has risen, with firms able to produce more with fewer workers.
The article reports: “Innovation in the manufacturing sector means that the jobs require greater skills than ever before.
According to an analysis by economists Richard Deitz and James Orr at the Federal Reserve Bank of New York, employment in high-skilled manufacturing jobs rose 37%, or by 1.2 million jobs, from 1983 to 2002. At the same time, low-skilled factory jobs dropped 25%, or by approximately 2 million workers.”
The article itself has generated a fairly vigorous blog posting at Industryweek which is well worth a read. (http://forums.industryweek.com:80/showthread.php?t=651)
From my own observation – capital spending in engineering software has risen dramatically in the last couple of years – evidence indeed that manufacturers have focused on greater efficiency through better and more productive use of technology.
But why the shortage of skilled labor? My take on this is all due to pay levels – in the last few decades a welder was able to support a medium-sized family, with 2 cars – nothing flashy – and an annual vacation. In recent years the manufacturing downturn resulted in decreased wages, which means kids entering the workforce have opted for IT and health jobs rather than welding and machining (or Crime Scene jobs, if the commercials from ITT tech are correct).
If indeed wages for such labor increase again, then it will still take a couple of years for the workforce to re-establish itself in these areas, which means that manufacturers will continue to have a skills gap for the medium-term.
What’s your take on this? Add your comments to this posting.