In the midst of our series on the manufacturing skills gap, we received a great response from many manufacturing professionals around our first three posts. When we explained what is the skills gap, we received many possible solutions and already with our post on the 4 possible solutions for the manufacturing skills gap, we are getting a lot of positive comments. Before we wrap our own series tomorrow, when we cover the future of the manufacturing worker and workforce, we wanted to bring you the thoughts on our post about if there truly is a skills gap in manufacturing or not from a long time manufacturing business pro, Al Jones. The below is his response on our LinkedIn Discussion in the IndustryWeek Manufacturing Group.
You can find more from Al Jones with his thoughts on historical manufacturing clusters at his blog at http://www.aljonesbusinessgrowth.com/. We highly recommend subscribing and reading. Give your thoughts to Al’s commentary at the end of this post.
Manufacturing Business Veteran’s Thoughts On If there is a Manufacturing Skills Gap or Not
It’s a murky topic until you get down to the shop floor and there the skills gap has always been painfully obvious, deep, and diverse (there’s never been a golden era when skilled manufacturing labor was plentiful and cheap anywhere.)
Losing young workers who’d grown up with a wide variety of practical skills constantly applied on family farms (at 60-80% of the population that was a big number but mostly predates the farms having a lot of equipment to learn repair and operation of) or city kids with years of shop classes/manual arts from middle school to high school with real proficiencies developed has made the shortage more severe as workers have a lot more ground to cover when they start.
The math that’s often required on the shop floor is typically reserved for College Math Majors in their Junior-Senior years and very few high schools can teach it with their own shortage of math faculty (the skills gaps in K-12 and higher education is enormous when you compare preparation/experience/ability to what’s being taught, a vast number are in way over their heads too.)
Paying More to Bridge the Skills Gap Could Mean Losing Manufacturing Sales
The point that salaries/wages just rise to whatever it takes is common but ignores that labor cost is significant in most manufacturing and raising your own labor costs well beyond competitors means a final product price that loses sales, making the higher payroll hell to meet. The constraint of what the job is worth in the overall value chain and what the company can afford to pay is known to everyone but academics and labor economists so it’s baffling when you think about it, comparing it to professional sports recruiting of a few top quarterbacks or pitchers makes no sense but has become common.
The subtle and powerful effect of a skills gap is you automate wherever possible and dumb down the work to lower-cost/faster-trained people (i.e. outsourcing to countries where in fact your workforce are peasant farmers just moved to a city who’ve never seen the production equipment or a factory before.) That destroys a lot of good jobs and has been for decades while meeting the needs of a customer base trying to expand their own purchasing power with stagnant real wages regardless of how their needs are filled (the Wal-mart or Nike model or China Inc.).
There is an Education Gap Contributing to the Skills Gap
Most formal education fits shop floor skills really badly and 4 year degrees are notable either for people working at jobs completely unrelated to their degrees’ courses of study and just happy to have a job (just like half of technical college students these days already have a B.A. or B.S. and found it unhelpful) or the very small set of engineers, managers, lab technicians, etc. who are often strangely unaware of the skills and knowledge required by their non-degreed colleagues and overestimate the actual value of their formal educations. That’s been noticed for at least a century except by engineering and business schools.
There’s a huge skills gap and with 27 million people unemployed in the G7 economies right now (last week’s Economist magazine) or 2 billion unemployed or grossly underemployed worldwide according to Gallup’s world polling, the greatest race remains between using many unskilled hands to do one function they don’t understand much but are cheap enough or a few highly skilled hands that may not achieve the same throughput or labor cost.
What do you think of what Al has to say? Leave your comments below!