By Ken Datzman of Brevard Business News
Manufacturing has long been a cornerstone of America’s economy, and is the most reliable predictor of a nation’s economic prosperity over the long term.
Joint research by Harvard and the Massachusetts Institute of Technology reveal that the competitive strength of a nation hinges on the health of its manufacturing sector. And the majority of Americans believe a strong manufacturing base should be a national priority. If given the opportunity to add 1,000 jobs in their communities, they ranked the manufacturing industry as their first choice relative to all other industries.
But over the last two decades, America has seen its manufacturing economy shrink, as thousands of U.S. factories closed and millions of jobs were lost to off–shoring. As a result, young people began to look elsewhere for better career opportunities in and beyond their communities.
When the glow of manufacturing dimmed, so did apprenticeship and certification programs, emphasis on vocational training in schools, and developing industry talent for the future.
“There is a whole generation that has skipped skills development in the manufacturing industry because of off–shoring,” said CareerSource Brevard’s Tina Berger, a sector strategy project manager who grew up in the manufacturing–intensive state of Michigan.
“Now, manufacturing is starting to come back home. It’s called ‘re–shoring.’ The industry will be facing a worker shortage as it tries to close the skills gap.”
A report by the U.S. Bureau of Labor Statistics shows that roughly 6 million manufacturing jobs were lost in the decade from 1999 to 2009, representing more than one–third of the sector’s work force. But since 2010, this trend has reversed. The sector has added 730,000, the first uptick since 1997.
Manufacturers have seen wage rates in Shanghi jump more than 76 percent between 2010 and 2013, with similar rates of increase in supporting industries such as transportation and logistics, according to a “white paper” by the Reshoring Institute, which provides research and support for companies bringing manufacturing and services back to America.
CareerSource Brevard is developing a local “sector strategy” to ensure that manufacturers are able to fill talent gaps and build their work–force pipelines for the future. The goal is to help them better position themselves to expand and to compete in an increasingly competitive marketplace. Sector strategies are “industry–led approaches” to work–force and economic development that align training to meet employer needs in regional labor markets, said Don Lusk, the program and policy officer at CareerSource Brevard.
Last year, Congress approved the federal Workforce Innovation and Opportunity Act, which went into effect July 1 of 2015. CareerSource Florida is now transitioning from the Workforce Investment Act to the WIOA. Florida was awarded a $7 million federal grant to strengthen the advanced–manufacturing and health–care sectors in the state. CareerSource Florida and the Department of Economic Opportunity will use the two–year grant to assess current and future needs in those two areas.
CareerSource Brevard received a two–year $765,000 “Sector Partnership Grant” from the state to help provide training and resources for area manufacturers.
“And we are set to kick off our sector–strategy discussion Oct. 15 in Brevard County,” said Lusk. “We are looking to bring as many employers as possible together from industry to address their common needs and generate coordinated solutions.”
“This will be a critically important meeting for manufacturers because we are going to create our two–year strategy based on the input we receive,” added Berger. “This is a valuable meeting for them to attend and we’re trying to stress the significance of it. Filling the talent gap and building the manufacturing pipeline for the future are issues that we’ll address at this event.”
Manufacturers will have the opportunity to steer the direction of the strategic plan to support Brevard’s manufacturing workforce. The forum is from 7:30 to 10:30 a.m. on Thursday, Oct. 15, at the Holiday Inn/Space Coast Convention Center in Cocoa. The address is 301 Tucker Lane. Visit CSB–AMEN.eventbrite.com, or contact Lusk at 394–0504 or [email protected] to register for the “Advanced Manufacturing Employment Now” event.
Judy Blanchard, CareerSource Brevard’s industry relations director, says her organization is not only inviting manufacturers, but also educators, human resource managers, training experts, economic–development professionals, and other community leaders to the event. “This is an extremely important gathering, because if we don’t train the future work force in Brevard, we are going to lose contracts. They will go to other states that are addressing these issues.”
The program will be led by Linda Fowler, president and founder of Regionerate LLC in Bethesda, Md. Her company, which she launched in 2009, partners with other firms and universities to provide products and services to support economic development, with a particular focus on partnerships with federal and state government and regional innovation.
Fowler has wide experience in her field. Her résumé includes years as a senior adviser at the National Institute of Standards and Technology’s Hollings Manufacturing Extension Partnership, as well as being an adviser at the Department of Labor. She was also a board member of the Association of Manufacturing Excellence. Fowler has a master’s degree in labor and industrial relations and human–resource development from the University of Michigan.
The U.S. will face a need for nearly 3.5 million manufacturing jobs over the next decade and 2 million of those jobs are likely to go unfilled because of the skills gap, according to new research from Deloitte Consulting LLC and The Manufacturing Institute.
Two parallel studies — “The Skills Gap in U.S. Manufacturing 2015 and Beyond” and “Overwhelming Support: U.S. Public Opinion on the Manufacturing Industry” — draw together perspectives from U.S. manufacturing executives and the American public. The studies say the U.S. will face a significant skills gap over the next decade, largely fueled by baby–boomer retirement and too few young people who see the industry as a career destination.
Business leaders and work–force–related organizations in communities are teaming up to change the perception of how manufacturing is viewed, especially by young people. Today’s manufacturing industry is “sleek, it’s high–tech and there is no shortage of different career paths” within the sector, from satellite technology to lifesaving medical devices, many of which lead to six–figure salaries.
“Manufacturing is embedded in so many different industries,” said Blanchard. “The perception has long been that manufacturing is an assembly–line, low–skill, low– wage industry, and that is absolutely not true today. Advanced manufacturing involves an understanding of science, technology, engineering, and mathematics. We need to show Millennials that this industry sector can provide them with a rewarding career.”
Blanchard added, “This is not only a local and state challenge, but it’s also a national challenge. It seems like no one has been paying attention to the manufacturing industry for the last 20 years. And this industry has changed in every way.”
Over the past years, most manufacturers have redesigned and streamlined their production lines while implementing more process automation. In short, the industry has changed. The nature of work that is required is changing as well. Change is happening fast and manufacturers will continue to expect more from their employees.
“A lot of students these days are graduating with degrees in robotics, gaming, and other disciplines that are a perfect fit for manufacturing. They just don’t know it. These are high–skilled, high–wage manufacturing jobs we’re talking about,” said Berger.
Nearly all of the jobs that were unskilled or semi– skilled have either been automated out of existence or moved overseas in search of cheaper labor. The jobs that are remaining in manufacturing are really focused on operating, maintaining, or programming the machines that are doing a lot of the actual manual labor and work that used to be done by human beings, says The Manufacturing Institute.
Manufacturing employs more than 328,000 people in Florida, with an average compensation of 69 percent more in earnings and benefits than the state’s average. Yet manufacturers are reporting a shortage of workers with technical skills, including production, machining, welding, and quality assurance, according to a new report by the Manufacturers Association of Florida.
“We need to have more parents encourage their children to consider manufacturing as a career pathway,” said Blanchard. The Manufacturing Institute’s study, for example, reports that only 37 percent of parents would encourage their children to pursue careers in manufacturing, and 52 percent of teens say they have no interest in manufacturing jobs.
Meanwhile, the average wage of manufacturing workers in 2013 was $77,506, and most manufacturing jobs now require some sort of post–secondary credential. The reduction or elimination of many of the vocational and technical programs available to high–school students around the nation will make the mission of trying to fill the skills gap doubly tough at a time when manufacturing is rebounding.
“CareerSource Brevard’s sector strategy folds in with bringing back shorter apprenticeship programs, because technology changes so fast,” said Blanchard. “We also need to emphasize short–term, industry–recognized credentials, as well as certification programs showing the work force how these credentials are stackable on the career ladder. The health–care industry has done a good job of that over the last decade because of the skills shortage in nursing.”
Changing public perceptions to match the modern realities of U.S. manufacturing will be critical to addressing the worker shortage, especially among Millennials, according to The Manufacturing Institute. Also important will be rebuilding a pipeline of potential recruits through high school and career technical programs. “Vocational schools will be a very important part of our sector strategy,” said Lori Robinson, a business liaison at CareerSource Brevard.
For years, manufacturers have reported a significant gap between the talent they need to keep growing their businesses and what they can actually find. “But now it has greatly intensified because of the pending retirement of the baby–boomer manufacturing talent, and we have not been feeding the pipeline to replace that talent,” said Blanchard.
When asked where the skills gap is likely to hurt the most, respondents of the Deloitte Consulting and The Manufacturing Institute survey identified “skilled production jobs” by a wide margin. Fully 80 percent of respondents indicated that machinists, operators, craft workers, distributors, and technician positions will be the hardest hit by retirements in the coming years. At the same time, companies expect the skilled production group to be the hardest to fill in the job market. The skills shortage pervades all stages of manufacturing — from engineering to production. The challenge will only grow as the demographics of the work force evolve with retirements, and with new technological advances that require a higher level of training and certification.
“CareerSource Brevard sees this meeting on Oct. 15 as a great opportunity to hear from area manufacturers firsthand and listen to what they believe are the biggest needs in their companies in skills–gap training. Right now, there is a sharp focus in Florida on this sector–strategy grant. Locally, we will be looking at all of our resources to determine the best ways in which we can assist manufacturers in the region to help prepare them for the future,” said Berger.
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