The Manufacturing Skills Gap, Part I: Federal, State and Local Governments

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    Since the Industrial Revolution, the U.S. manufacturing industry has been one of the country’s most powerful economic engines. According to the National Association of Manufacturers, each dollar invested in the U.S. manufacturing industry creates an additional value of $1.37 in other sectors while every job in the industry creates 2.5 jobs in local goods and services.

     

    U.S. manufacturers, however, continue to face a number of key challenges that threaten to slow down future growth, the most alarming of which is the “skills gap.” Beginning in the early 2000s, the steady decline of apprenticeship and training programs across the nation has left novice manufacturing engineers without the skills needed to fill highly-technical positions – leaving businesses to grapple with the consequences.

     

    Every manufacturing position that goes unfilled for three months or longer ends up costing companies an average of $14,000 per year. Businesses hoping to avoid such losses by hiring inexperienced employees also face risks. A recent study of U.S. manufacturing executives found the top three most important skills today’s employees lack are:

     

    • Technical and computer proficiency
    • Basic technical training
    • Math skills

    As a result, the three areas of business manufacturing executives believe are most affected by this talent shortage are:

    • Meeting customer demand
    • Implementing new technologies
    • Increasing productivity

     

    Aside from a lack of proper training, contributing factors to the skills gap, such as the retirement of baby boomers and negative perceptions of manufacturing among younger generations, are expected to cause more than half of all manufacturing jobs to go unfilled over the next decade.

     

    In order to help narrow the skills gap, federal, state and local governments share in the responsibility of helping prepare future workers for a career in manufacturing.

     

    Dedicated Funding

    In December 2014, President Obama announced a $100 million American apprenticeship grants competition run by the U.S. Department of Labor. The program was established in an effort to increase the number of apprenticeships in quickly expanding fields, specifically advanced manufacturing. Although it is a step in the right direction, the manufacturing skills gap continues to widen. Consistent funding is needed to turn nation-wide apprenticeship and training programs into a reality.

     

    State and local governments can also make a difference by empowering agencies responsible for building and strengthening nearby workforces. Examples of this type of support can already be seen in Wisconsin, where the Wisconsin Department of Workforce Development has helped introduce an Industrial Manufacturing Technician Apprenticeship. The program will provide entry-level workers with an overview of manufacturing that includes experience operating valuable equipment.

     

    Local Partnerships

    According to Becky McMorrow, Global Product and Supplier Marketing Manager at electronics distributor Newark element14, community colleges are another untapped resource that can aid federal, state and local governments in mitigating the skills gap. “By forming partnerships, governments and community colleges can work together to identify programs that are successful in equipping workers with the skills needed to fill open manufacturing positions,” Becky said.

     

    Such partnerships have recently started to take root. Michigan Governor Rick Snyder invested $50 million in local community colleges, giving them the money to purchase equipment required for educational programs in highly skilled positions. Through strict measurement of the effectiveness of grant-funded programs, governments and colleges can continue to collaborate with one another to ensure these partnerships are indeed helping to close the skills gap.

     

    This is Part I in a three-part to series on the manufacturing skills gap.

     

    Individual installments in this series: