Manufacturing Industry: Labor Market Concerns, Employment Growth, and Retention
By Juliana Shepetiak, Senior Manager, Assurance Services
While COVID-19 is no longer an everyday concern for most organizations, the pandemic permanently changed the workforce and the way companies operate — especially in the manufacturing industry. In the 2022 Marcum Manufacturing Survey Report, respondents cited the tight labor market and employment growth and retention among their top concerns. While a large percentage of respondents expect revenue and industry growth in the coming year, more than 75% acknowledged that their workforce is critical to business success. Given the shortage of skilled manufacturing workers, employers need to look at different and creative ways to build and strengthen the workforce.
To remain competitive in hiring and retaining top talent, manufacturing companies need to offer market-level options. Most manufacturers are offering higher wages and looking to improve benefits to attract new talent and retain existing employees. Over the next two-year period, 77% of survey respondents plan to increase wages by 5% or more, and a quarter anticipate an increase of more than 10%.
There are several tools manufacturing leaders can use to create effective teams that stay together. Investing in the strengths, behaviors, motivations, and interests of your workforce is a great place to start. There is also the Birkman Method®, an occupational assessment that can help with retention. Marcum has helped clients in different industries use this approach internally to ensure a happy and cohesive environment.
While the Great Resignation hit every employer in the economy, manufacturing companies are suffering more than most — largely because skilled workers retired, changed careers, or simply opted out of the workforce. Eighty-three percent of survey respondents cited replacing skilled labor with reliable talent as their biggest challenge. Although improving wages and benefits is a great strategy, manufacturing companies will need to do much more to attract new talent and retain employees. Manufacturing companies will need to work on creative retention and attraction tools while leveraging technology to drive innovation and improve quality and service offerings.