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Bridging the Widening Skills Gap: 3.8 Million New U.S. Manufacturing Jobs Expected in Next Decade

Posted by IndustryNet on Monday, April 8, 2024

Bridging the Skills Gap: U.S. Manufacturing's Future


As the U.S. manufacturing industry emerges from the shadows of the pandemic, a new report from Deloitte and the Manufacturing Institute suggests a potential resurgence of growth in the sector, fueled by a combination of evolving customer demands, a push to localize supply chains, and a favorable policy environment. However, this promising horizon is not without its clouds. A significant challenge looms over the sector: a skills gap coupled with a tight labor market.

The report, titled “Taking Charge: Manufacturers Support Growth with Active Workforce Strategies,” examines these workforce challenges in detail, providing a comprehensive analysis of the investments and skills required to sustain the industry’s growth trajectory, and contains some staggering statistics on projected growth—and shortfalls in the coming decade. Let’s take a look at some of the key takeaways from this landmark study.

Accelerating Job Growth & Workforce Challenges: Key Findings

The study reveals that workforce challenges have consistently ranked high among U.S. manufacturers’ concerns since the fourth quarter of 2017, barring the pandemic period. The crux of the issue lies in the accelerating demand for digital skills. As manufacturing operations and products grow in complexity, the need for talent capable of integrating and analyzing information from smart connected devices and systems becomes critical. Other key insights from the survey found the industry, already struggling with historic levels of unfilled manufacturing jobs, is poised to add even more jobs in the coming years—jobs that companies will have a tough time filling. Specifically:

• The U.S. manufacturing industry is expected to have a net need for 3.8 million jobs over the next decade.
• Due to the skills gap, up to 2 million of those jobs (approximately 5 in 10) could go unfilled.
• The skills gap could leave an estimated 2.4 million positions unfilled between 2018 and 2028, with a potential economic impact of 2.5 trillion.

These statistics underscore the significant workforce challenges facing the U.S. manufacturing industry and the urgent need for effective talent development and retention strategies.

The Ongoing Skills Gap & Building a Talent Ecosystem

To address these challenges, manufacturers are not just increasing their investments but also diversifying them. They aim to align with the evolving workforce’s needs, skills requirements, and values Retention strategies are also being revamped to keep pace with the industry’s innovation.

John Coykendall, a principal at Deloitte Consulting LLP and vice chair of U.S. industrial products and construction, emphasizes the importance of developing talent. “The manufacturing industry is facing exponential opportunity,” he says. “Yet, it must prioritize strategies that address the skills and applicant gap, especially as the acceleration of digital skills-based jobs continues.”

The report suggests that manufacturers must look beyond traditional talent pipelines. The pandemic has already catalyzed the creation of new jobs, and now the industry faces increased demand for digital skill. Carolyn Lee, president and executive director of The Manufacturing Institute, points out that "companies must prioritize technology, training, and talent development."

According to the study, manufacturers are indeed expanding their horizons and forming strategic partnerships. According to a recent survey, over 90% of manufacturers are collaborating with at least one external entity, with an average of four partnerships per manufacturer. These collaborations span across various sectors including technical colleges (73%), industry associations (58%), universities (48%), state and regional economic development agencies (47%), and K-12 schools (44%).

These partnerships are not just about recruitment; they are also about fostering talent development. A significant portion of these collaborations is dedicated to creating and supporting training programs. In fact, nearly half (47%) of the surveyed manufacturers believe that apprenticeships, work studies, or internships at manufacturing companies are the most effective ways to spark interest in manufacturing careers.

This proactive approach to talent development and retention underscores manufacturers’ commitment to nurturing a skilled workforce that can meet the industry’s evolving needs and build out a talent ecosystem. By going beyond traditional talent pipelines, manufacturers are paving the way for a robust and resilient future for the industry.

In conclusion, the Deloitte report underscores the need for active workforce strategies to support the manufacturing industry’s growth. By investing in technology, training, and talent development, manufacturers can bridge the skills gap and harness the full potential of the digital revolution. The future of manufacturing is bright, but it requires a workforce equipped to handle the challenges and opportunities that lie ahead.

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