More than five years after the official end of the Great Recession, Americans continue to face underemployment and slow growth. These real and troublesome problems persist despite the resurgence of America’s manufacturing sector. Yet, that resurgence is reason for real optimism, but only if the challenge of ensuring a globally competitive workforce is addressed successfully.
Fortunately, manufacturing companies are leading with innovative, practical solutions that promise long-lasting benefits.
Realizing the full potential of this strong growth in U.S. manufacturing depends, however, on the quality and size of the available workforce. According to an estimate from The Manufacturing Institute, approximately 600,000 manufacturing positions today remain unfilled due to a “skills gap,” or the misalignment between needed competencies and the proficiencies of job seekers. These unfilled jobs would pay well; manufacturing workers earn on average more than $77,000 in salary and benefits, $15,000 more than the average worker across all industries. But workers with the right skills are not available for these jobs.
Federal policymakers recently took an important first step toward addressing this situation when Congress enacted the Workforce Innovation and Opportunity Act. This bipartisan legislation streamlines existing workforce development programs. But much more needs to be done, and manufacturers cannot afford to wait.
With this specific goal, the National Association of Manufacturers (NAM) created the Task Force on Competitiveness & the Workforce, which comprises 17 member companies representing the diversity of the sector. NAM Board Chairman Doug Oberhelman, chairman and CEO of Caterpillar Inc., charged the task force with developing ways for manufacturers to work together to improve workforce outcomes without further changes in Washington, D.C.
The task force confirmed that the skills gap is pervasive. In a recent survey (Page 5, figure 3) by The Manufacturing Institute, 79 percent of manufacturers reported a “moderate” or “severe” shortage of qualified applicants for open positions. These shortages exist in every state and every sector of the manufacturing community. Increasingly, employers need job candidates with training in science, technology, engineering, and mathematics, or STEM-related areas, to operate and maintain the high-tech machinery that now dominates shop floors. And, all candidates, even ones for entry-level positions, require “soft” skills—interpersonal attributes, such as a teamwork mentality and adeptness at managing conflict—essential to productivity.
These findings are why the task force has developed a toolkit and guide to help create change at the grassroots level. The materials help manufacturing leaders collaborate in their local communities to identify key competencies needed for new hires to succeed in today’s advanced manufacturing operations, develop a plan for local workforce training providers to deliver the needed training and grow a pipeline to ensure a supply of future skilled talent. Building the pipeline will require engagement with secondary school and community college educators. NAM-endorsed certified “stackable” credentials will play an important role in creating the pipeline. Manufacturers will execute the plan through outreach programs to ensure that secondary students, parents and guidance counselors understand the reality of modern manufacturing as safe, sleek and technology-driven.
In this way, manufacturers will help to close the skills gap and maximize the contribution of manufacturing to the U.S. economy. Of course, additional reforms at the federal level to increase local and state flexibility to program federal funds to address region-specific needs would be enormously helpful. We continue to call on Congress and the Obama administration to act in a bipartisan fashion to reduce burdens on training for today’s—and tomorrow’s—skilled workforce.
But manufacturing leaders are not depending on Washington. From small and medium-sized manufacturers to the Fortune 500, NAM member companies are leading the way in developing a more competitive workforce that has the skills needed to grow America’s economy. As was the case during other national crises—after the Civil War, during the Great Depression and throughout World War II—manufacturing can once again help create the foundation for sustained prosperity.
Blankenship is president and CEO of GE Appliances & Lighting and chairs the NAM Task Force on Competitiveness & the Workforce. Timmons is president and CEO of the NAM.