Skilled Workforce: The Key to Reshoring and the…

Skilled Workforce: The Key to Reshoring and the…

Jun 13, 2016

“Skilled Workforce: The Key to Reshoring and the Manufacturing Renaissance”

By Harry Moser and Sandy Montalbano, Manufacturing Stories

The skills gap in a nutshell

Demand for workers with STEM skills is rising, but business leaders can’t find enough employees to fill the demand. Though some economists argue that wages aren’t increasing rapidly, therefore there must not be a skills gap, a recent Harvard Business School study cited in a New York Times article suggests otherwise: the U.S. is facing a critical shortage of workers with technical skills because “employers are more inclined to invest in technology or hire part-time workers than spend money on training programs…[and] companies have lagged in collaborating with community colleges to develop training programs.”

We see the root cause as more broadly distributed to also include our society and educational system. In addition, offshoring has played an important role in degrading our skilled workforce. First, offshoring has created the perception that manufacturing careers are not secure. Second, since domestic manufacturing has not grown as fast as in the past, there has been less investment in new technology, resulting in lower productivity growth and an inability to pay the higher wages the study might have otherwise found.

Misperceptions about manufacturing

A strong skilled workforce is key to reshoring and manufacturing growth but there is a misalignment between degrees and job skills. Eighty two percent of manufacturers are enthusiastically seeking engineers and CNC/3D operators and programmers. One reason for the shortage is too many students attending four-year universities, resulting in a 40% excess supply of non-technical university graduates along with soaring student debt. The disconnect is in the perception of manufacturing careers. Manufacturing today is not like it was in your grandfather’s day. It has shifted largely to modern, high-tech operations and pays on average 19% more than non-manufacturing jobs.

The major obstacle to expanding the needed skilled manufacturing workforce is recruitment; too few students want to follow STEM fields, especially manufacturing, mainly due to three key issues:

  1. Perception that training is not as important as degrees
  2. Perception of ongoing manufacturing decline due to offshoring
  3. Perception that vocations/trades training is lower prestige and income than a 4-year university degree

Development of a skilled workforce begins with motivating a higher quantity and quality of recruits. The Reshoring Initiative’s Skilled Workforce Development Program is designed to change some of the misperceptions about manufacturing and help communities develop the skilled professionals needed to reshore manufacturing to the U.S.

  1. Put training on a par with education:Change the perception that training is not as important as degrees. Include in Bureau of Labor Statistics data incomes of workers who have passed apprenticeships or have a strong portfolio of certificates. By making available to guidance counselors and school administrators data showing that there are “Other Ways to Win,” we will attract higher caliber recruits.
  2. Overcome the perception of manufacturing decline:Shift the belief that there is no future in manufacturing and that all the work will go offshore by promoting reshoring successes. Recruiting needs reshoring to be visibly successful to motivate students to select, guidance counselors to recommend and schools to provide skills training. Promote reshoring by publishing success stories in local and national media.
  3. Replace “vocations” and “trades” with “professions”:Change the perception that vocations/trades training is lower status than a 4-year university degree. Increase the attractiveness of skills training and careers by terminating the use of the terms “vocation” and “trades” and refer to the skilled occupations as professions and the workers as professionals as is done in Germany and Switzerland.
  4. Replace “Middle Skills” with “Technical Skills”:These jobs are often referred to as the “middle skills” jobs. We suggest finding a more positive term. Here are some alternatives to “middle skills”:
    Technical skills
    2. STEM skills
    3. Career skills

We are seeking companies, communities, schools and community colleges that would like to implement one or more of these programs.

Contact us for more information on how we can help you.

Shaping our workforce
Creating a stronger skilled workforce is key to reshoring and the country’s manufacturing growth. Manufacturing is central to a vibrant economy. America needs a coordinated effort between our public educational system, government and business leaders to provide the proper alignment between jobs and skills development in order to shape our workforce and drive our economy.

Reshoring is a fast and efficient way to strengthen the U.S. economy, foster a skilled workforce and benefit manufacturing companies by reducing total costs, improving balance sheets and supporting innovation.

Are you and your company using all of the available Reshoring resources? Here is a list of just a few helpful tools to aid in your reshoring decision-making process:

  • Calculate TCO with the Total Cost of Cost of Ownership Estimator™– Free online tool to help evaluate sourcing alternatives and to make a case when selling against offshore competitors.
  • Submityour own reshoring case for free publicity.
  • Invitethe Reshoring Initiative to address your or your customers’ industries at a speaking engagement or meeting.

Please consider posting a link to the Reshoring Initiative on your website, and/or donating your time, talent or dollars. You can download our logo at the website. Contact us for more information on how you can help.

 

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