The Unique Challenges Industrial and Manufacturing Companies Face in Finding, Attracting, and Retaining Talent

According to a recent report from the UKG Workforce Institute, 76% of manufacturers face challenges in finding qualified workers despite production capacity and revenue improvements. The survey of over 300 manufacturing HR leaders revealed that filling open positions takes longer, with 66% reporting increased hiring time.

Addressing the critical labor shortage has been a long-standing issue for manufacturers, even predating the pandemic-induced shortages seen in other industries. However, the majority of organizations are now taking proactive steps to bridge the manufacturing skills gap and prevent potential economic stagnation.

The survey also highlighted a rise in employee turnover, with 62% of respondents reporting an increase. Additionally, 57% noted an increase in unfilled jobs compared to the previous year, and 54% reported an annual turnover rate higher than 20%.

So what can you do? Here are some top tips for finding, attracting, and retaining talent.

Hiring Challenges in Industrial and Manufacturing Companies

Industrial and manufacturing companies face several hiring challenges in today’s competitive job market. These challenges can significantly impact their ability to find, attract, and retain talent.

Here are some of the critical hiring challenges these companies are currently facing:

  • Skills Gap: One of the most significant challenges in the manufacturing industry is the skills gap. Rapid technological advancements require a workforce with updated skills, but there’s often a shortage of workers with the right qualifications. Finding candidates who possess the necessary technical and soft skills can be challenging.
  • Aging Workforce: Many industrial and manufacturing companies have an aging workforce nearing retirement. Replacing experienced workers and transferring their knowledge to younger generations is a critical concern.
  • Competition for Talent: The manufacturing sector faces stiff competition for talent from other industries, such as technology and healthcare. Attracting skilled workers can be challenging when other sectors offer higher salaries and perceived better working conditions.
  • Changing Workforce Demographics: Industrial and manufacturing companies are dealing with changing demographics, including a growing need for a diverse workforce. Companies must adapt their recruitment and retention strategies to be more inclusive and appealing to a wide range of candidates.
  • Negative Perceptions: Outdated stereotypes about low-paying, dirty, and dangerous manufacturing jobs persist. Overcoming these misconceptions and highlighting the industry’s modern, high-tech, and well-compensated roles is challenging.
  • Automation Concerns: Automation and robotics have improved efficiency in manufacturing, but they also raise concerns among workers about job security. Companies must address these concerns and invest in training and upskilling programs to show a commitment to employee development.
  • Geographic Challenges: Manufacturing companies may be located in regions where the talent pool is limited. Attracting talent to these areas can be difficult, and companies might need to offer relocation packages or remote work options to overcome this challenge.
  • Regulatory Compliance: The manufacturing industry is subject to various labor regulations, which can complicate the hiring process. Ensuring compliance with labor laws while also attracting the right talent can be a balancing act.
  • Retaining Talent: Once companies have successfully hired skilled workers, retaining them is another challenge. Employees may leave for better opportunities or if they feel undervalued. High turnover can be costly and disrupt operations.
  • Environmental and Sustainability Concerns: An increasing emphasis on sustainability and environmental responsibility in manufacturing can create challenges in finding talent with expertise in these areas. Companies may need to invest in training or seek candidates with specialized knowledge.

Top Tips for Finding, Attracting, and Retaining Talent

The manufacturing labor market has shown signs of improvement. This is great news for industrial and manufacturing companies looking to expand their workforce.

Here’s how companies can take advantage of these improvements:

  • Leveraging Technology: Technology has revolutionized the manufacturing industry, making it more attractive to job seekers. Companies should invest in state-of-the-art equipment and automation systems, as these advancements not only enhance productivity but also appeal to tech-savvy individuals.
  • Partnering with Educational Institutions: By establishing partnerships with local schools, vocational programs, and community colleges, manufacturing companies can ensure a pipeline of skilled workers. Offering internships and apprenticeships is an effective way to attract young talent and provide them with hands-on experience.
  • Fostering a Diverse and Inclusive Work Environment: Diversity and inclusion initiatives can help manufacturing companies attract a wider pool of talent. Creating a workplace where individuals from diverse backgrounds feel welcome and valued not only helps with recruitment but also promotes employee retention.
  • Competitive Compensation and Benefits: To attract top talent, manufacturing companies must offer competitive compensation packages. Some manufacturers are increasing wages and offering sign-on bonuses to remain competitive. Additionally, providing comprehensive benefits, such as healthcare, retirement plans, and professional development opportunities, can enhance employee retention.
  • Embracing Remote Work and Flexibility: The COVID-19 pandemic has shown that remote work is possible in many manufacturing roles, particularly in administrative and managerial positions. Offering flexible work arrangements can attract employees who value work-life balance. Companies should consider hybrid work models where feasible.
  • Employee Training and Development: Manufacturing companies should invest in continuous training and development programs. Upskilling existing employees can fill skills gaps internally, reducing the need for external hiring. Employees who see opportunities for growth within a company are more likely to stay.
  • Employee Recognition and Engagement: Acknowledging and rewarding employees for their hard work and dedication is crucial. Implementing employee recognition programs can boost morale and job satisfaction. Engaged employees are more likely to stay with a company long-term.

In today’s ever-evolving job market, finding, attracting, and retaining talent in the industrial and manufacturing sectors requires a multifaceted approach. The strategies mentioned above provide a comprehensive framework for addressing labor challenges and building a strong and sustainable workforce.

But, remember that talent acquisition and retention are ongoing processes that require constant attention and adaptation. By embracing technology, fostering partnerships, promoting diversity and inclusion, offering competitive compensation and benefits, providing flexibility, investing in employee development, and prioritizing engagement, manufacturing companies can position themselves as employers of choice and thrive in the evolving world of work.

Need help finding, attracting, and retaining talent? Contact us today!