How to Address the Skilled Labour Shortage

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How to Address the Skilled Labour Shortage

Why the demand for skilled workers is growing

The demand for skilled workers is on the rise, and it’s not just due to growth or replacement. Why? Several factors are contributing to this trend:

  • The digital transformation of manufacturing means that businesses can produce higher-quality products more easily than ever before. As a result, work in manufacturing has become less repetitive and more specialized—and these changes require workers with new skills and knowledge.
  • Aging populations mean that there are fewer younger people available to take up the slack as older workers retire, who may have been working at their jobs for decades. This creates openings for young people who have never worked in factories before but are willing to learn new skills so they can fill those gaps as needed.
  • Lack of interest in manufacturing careers is another reason we are seeing a lower number of younger people joining. For some there is a misconception when it comes to the manufacturing industry. For instance, many university graduates view the manufacturing industry more appropriate for those who did not pursue further education. The manufacturing industry is often seen as old-fashioned, monotonous and low-paid. Not to mention male dominated.
  • At the beginning of the Covid-19 pandemic there were four unemployed people for every vacancy in the UK. Now the ratio is one for one with vacancies beginning to outnumber unemployment. The jobs emerging post pandemic are now different to the ones found redundant during the pandemic, leaving a gap between the new skills required and those that exist in the job market. With approximately 1.1 million fewer people in the workforce due to a population decline, as well as more people leaving the UK, and with fewer entering emphasize that some of this story is due to not only the pandemic but Brexit as well. This has led to a stronger competition for staff that just aren’t there.

Causes of the skilled labour shortage

The skilled labour shortage is caused by a few factors as shown above. From older workers retiring faster than young people are entering the workforce, to a worldwide pandemic. In addition to the lack of interest in manufacturing careers, there is a lack of investment in STEM curriculum. And finally, manufacturers require greater skills because they are adopting advanced technologies that require employees to be highly trained and specialized.

When we asked what you thought the main causes of the labour shortage were, 53% of our followers felt the main cause of the shortage was due to the lack of interest in manufacturing careers. The next highest cause was believed to be due to a lack of available training. 

Challenges caused by the labour shortage

If you’re a business owner in manufacturing, you need to be aware of the challenges caused by the labour shortage. When asked about the labour shortage, our Marketing Manager Curtis said, “There is a high chance of losing valuable skills – look at traditional tin liners – there are only 3 in the UK that offer that service anymore.”  A lack of skilled workers can impact productivity, quality, and customer service. Your company may be unable to meet its customers’ demands or it could find itself with a surplus of goods that no one wants. With a rise in product demand, either domestic production or imports must increase to satisfy demand. This can be detrimental as we’ve seen the effects of Russian oil and gas impacting the global economy.

Hiring and training new employees can be expensive, especially if choosing to go through a recruitment agency rather than posting a position yourself. In December 1 in 3 UK employers said that recruiting new staff would pose a significant challenge. Although when we asked for your opinions, just over half of respondents stated they didn’t have to change their hiring methods.

Solutions for the labour shortage

The following solutions for the labour shortage are being implemented by manufacturing companies:

  • Apprenticeships –
    • To fill the skills gap, companies are partnering with schools to offer apprenticeships. For example, in North America, Boeing created an annual pre-college robotics competition with a goal to provide more opportunities for students interested in advanced STEM education. This initiative is expected to engage more than 5,000 students from high school and college levels each year into engineering degrees and careers. In the UK, Rolls Royce partnered with various universities to offer undergraduate-level training programmes in engineering and business management which became available in September 2020; this will also help ensure that Rolls Royce has access to talent as they continue their growth plans over the next decade. Apprentices learn trade skills from more experienced members of the team while learning to be accountable, responsible, and bring a fresh perspective to current operations.
    • Perhaps it’s time to rethink the Apprenticeship Levy. The London Progression Collaboration released a report during the recent National Apprenticeship Week in 2022 that there has been a 72% drop in entry-level apprenticeships since 2014. This could call for an opportunity to broaden the Apprenticeship Levy by including entry level apprenticeships as well as degree apprenticeships or possibly renaming it to the Skills Levy to open it up to more types of training and upskilling.
  • Upskilling – Companies can also upskill existing employees or hire talented individuals who lack experience but have relevant skillsets through self-paced learning courses. Training and upskilling your existing workforce can create a well-rounded, multi-skilled workforce capable of increasing overall efficiency and product quality. Upskilling and retraining options will be needed for those facing redundancy due to jobs that are no longer required. In doing so employers will not only gain new skills they will also gain stronger trust and devotion from employees.
  • Automation – Although robotic automation has been shown to be beneficial for handling a wide range of applications across multiple industries many companies lack the skills or experience needed to operate the automation equipment. However, companies must then offer training and support to new users allowing companies to not only increase automation but also address the issues caused by a shortage of skilled labour or available labour. Half of our followers said they have considered using automated technologies to fill vacant roles or assist existing workers. Technology is certainly not the sole answer as we will always need a human element not only ensuring everything is working in order, but also to check in on the well-being of their staff. In our recent polls we found 25% of respondents would consider using automation to support staff.
  • Hiring – It is important for companies to remember university leavers through to young people with only school-level education will not be primed and ready to go straight out of school. This means employers must realize they have to invest in vocational training for early-career employment and on the job training required for their future workforce and diversifying their talent pool.
  • Banish the stigma – A stereotype of manufacturing is seen as old, grubby and for those lacking a higher education. However, this is not the case, and organisations like Jefferson, MTD, The manufacturer, MakeUK, Made in Britain etc. all highlight industry’s improvements through innovation and new processes. This is just a small sample of what these organizations offer. On a business level, manufacturers need to do more to get with the times and offer a new approach at promoting manufacturing and their craft/trade. Metal Spinning was unheard of until we physically got onto social media and other forms of media to promote what it is.
  • Companies working with schools and universities – There is a lack of focus on areas of industries that require skilled labour and offer plenty of opportunities for young people. With an overwhelming 95% of followers voting that schools do not prepare students for the workforce there was debate on how to change this and who is responsible. This is not a one-person solution either, companies need to work with colleges and universities looking to develop young people for the working world. This could look like companies offering work experience or sponsored degree level apprenticeships before students enter the workforce full-is an example of supporting industry manufacturing as well as the possibility of those then joining the company afterwards. Another option would be to offer open days for young people to get hands on and learn about manufacturing processes.
    • There are also role models like Nigel T Packer, who works through Big Ideas Wales by speaking to students about the different avenues available to them after school. Nigel keeps in mind that university may not be the best option for every individual. He helps to create an environment that challenges students to think about every step that goes into making items used all around the world. From sourcing materials to selling to the consumer he broadens students’ perspectives of what employment is available and often overlooked.

Finding and retaining skilled workers is a challenge, but there are things you can do to address it

The challenge of finding and retaining skilled workers is real. If you’re like most manufacturers, you may have experienced it first-hand. But there are things you can do to address these challenges.

Be proactive.

It’s not enough to just wait for applicants to come through your door with the skills you need. You need to be proactive in seeking out qualified candidates and outlining what makes your company a great place to work. Think about what your organization has going for it; it’s history, location and reputation; the benefits offered; opportunities for advancement; professional development opportunities – and highlight them all in job postings, interviews and during tours of the facility so that potential employees understand how attractive this position is compared with other opportunities available in the market.

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Source Material

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