The economy is booming, and this presents challenges for manufacturing organizations. Your top-performing employees are prime targets for competitors that are not only willing to offer a higher wage but can also offer a more attractive work environment and career growth path.
Before I dive into a strategic approach to hire top talent and retain your best employees, we need to understand the dynamics of manufacturing and labor statistics. The unemployment rate in the manufacturing industry is at its lowest in the last 15 years (Figure 1). This presents a challenge for companies to find qualified employees to fill job openings. Highly skilled employees with a strong work history are in high demand.
Figure 1: Federal Reserve Economic Data (FRED) St. Louis Fed, “Unemployment Rate: Manufacturing Industry, Private Wage, and Salary Workers,” December 6, 2019.
The Big Challenge for the Next Decade
As we look forward, economists expect a slow-down in the next few years, but the demand for skilled employees will continue to be strong. One of the expected challenges is the skill gap being created. According to one study, the gap between available jobs and the number of skilled workers is growing. The study estimates that there may be up to 2.4 million jobs unfilled in the next decade in the United States, with the possibility that certain skilled and managerial positions will become almost three times harder to fill than they are now. In preparation for this challenge, leading companies are taking mitigation steps to retain their top employees and creating a company culture that is attractive to draw prospective employees into the organization.
Hire the Right Talent, Not the Best Talent
The natural inclination is to always hire the best available talent for a given role. This approach makes the most sense in theory but may not yield the expected results in practice.