Has the Skilled Labor Shortage Improved in 2023?

Source: McKonly & Asbury

In July 2022, Brett Bauer, CPA wrote an article surrounding the skilled-labor shortage in the manufacturing industry. The question now is, what difference has a year made?

According to a February 2023 article published by CNBC, during 2022, more than 50 million workers left their jobs. This mass exodus was coined as the “Great Resignation.” This is inclusive of all industries accumulated by the Bureau of Labor Statistics (BLS). According to BLS, August 2022 showed there were approximately 832,000 job openings in durable and nondurable goods manufacturing. The preliminary numbers reported for August 2023 have reduced the number of job openings to approximately 616,000. Nearly 26% of the openings have been fulfilled. The labor shortage appears to be heading in a positive direction, but the country is not completely out of the weeds yet.

There are quite a few reasons behind this Great Resignation. From normal retirement of the aging workforce to those that have decided to leave due to diminishing workplace culture, unsatisfactory working conditions, or lack of personal fulfillment in their position, the psychological and/or philosophical reasoning behind individuals vacating their jobs is a topic beyond the scope of this article. However, these factors should be considered when trying to attract and retain talent to fulfill these open positions.

Position Filling Approaches

What can employers do to fill the critical positions, even if a candidate may not have the necessary skills? Consider the following methods for filling needed positions.

PAID APPRENTICESHIPS

One of the most enticing opportunities is a paid apprenticeship. One employer in our local community, that was facing a critical shortage of certified welders, took this new approach to mitigate negative ramifications from the shortage. Their method was to introduce a training program that would give newly hired and existing (unskilled) employees the education and skills needed to obtain the certification. Existing employees of the company were incentivized to switch departments to start learning the welding trade. The positions that were vacated were in areas in which specific skills were not needed; these jobs tend to be easier to fulfill, since there are no immediate skill barriers to entry. While there was a cost to implementing this program, the company felt as though the investments made in the growth and education of its employees will end up generating a positive return on investment over time.

AN INTRODUCTION AND EMBRACE OF TECHNOLOGY

Automation is thought to have an adverse effect on job availability, as the term has been synonymous with replacement of the labor force. Automation has come quite a way since the first robot hit the manufacturing industry. Instead of robots replacing the labor force, some are looking at a more symbiotic relationship with robots. There is an app developed by Lincoln Electric called “Cooper” that was designed to work with their welding “cobots,” and is one of the most intuitive apps for programming a machine, in my personal opinion. The app, in conjunction with the cobot, is programmed by simply moving the arm to a starting point, pressing a button, then to the end point, and pressing a button. Once done, that machine is now set for a repeatable process. As the company claims in their demo video, “even a NASCAR driver can do it.”

LOCAL INVOLVEMENT AND ENCOURAGEMENT OF TRADES

Engaging in meaningful dialogue with local high schools and vocational schools, talking with the faculty and the students, and asking what their passions, plans, and goals are (while being genuine about it) could help spark an interest in the trades that are currently lacking skilled labor. This approach of engaging early on with the future workforce about available opportunities might alleviate a similar labor issue in years to come. Connecting with prospective employees in the community is also an option for filling the currently available positions. Communicating the reasons why they would be more than a number, showing how they would be cared for on an individual level, and demonstrating a passion to see them succeed are all good conversations to have with local talent that could fill a critical hole in an organization. This approach is also a great way to remain connected and involved with current staff; have the same conversations and give them opportunities to grow. If provided the chance, some employees could be significantly more productive in areas they are interested in learning more or are passionate about.

For more information regarding our manufacturing experience, be sure to visit our Manufacturing Services page and don’t hesitate to reach out to a member of our manufacturing team.