We cannot win the bet on manufacturing unless we as a region and a state work hard to help manufacturing succeed. A key component is ensuring that we have the needed work force.
Manufacturing has supported this region for more than a century. It still is responsible directly and indirectly for almost 40 percent of the region’s jobs. The industry’s impact on the region is enormous and will remain so, if we support it.
We have to recognize, however, that some jobs will be lost due to global competition and productivity increases, regardless of our efforts. The region has lost 3,608 manufacturing jobs since May 2005; many more will be lost without explicit actions.
The most significant business challenge, according to a recent Milwaukee 7 survey of manufacturers in the region, is creating a sufficiently large and skilled labor force. Regional manufacturers today are facing shortages of both skilled and unskilled production workers. Some firms also are facing difficulty in finding engineers for both product development and process development and refinement. Other firms have trouble finding management talent. All shortages must be addressed.
One contributing factor is the retirement of manufacturing workers. The baby boom generation is currently aged 41 to 62. Older boomers, particularly those who have been involved for decades in manufacturing, are beginning to retire. Some local firms face upwards of 25 percent of their work forces retiring in the next three years. The average is closer to 10 percent.
Retirements will rise for several years as this population ages. Some workers may elect to work more years, but evidence suggests the number is small.
The challenge is finding replacements. Several barriers exist.
One is that the region’s labor force is projected to grow only 0.4 percent per year for at least the next decade. That means few new entrants to the labor force and competition among employers.
Another barrier is the lack of basic work skills in the potential entry-level labor pool. Employers today are sorting through literally hundreds of applicants who lack basic workplace skills to find a single job-ready person.
Compounding the problem is that the history of boom and bust in manufacturing has made the industry less appealing – potential workers have purposely avoided taking jobs for fear they will lose them in the next downturn.
Another factor is an increased need for individuals with higher levels of basic skills. Thirty years ago, jobs requiring no literacy began to disappear. Today, workers increasingly need at least eighth-grade math skills and literacy. Many workers must also have basic computer skills.
For the region to win the bet placed on manufacturing, it must take several explicit steps, which include:
- Making the region’s work force development organizations, including Milwaukee Mayor Tom Barrett’s Office of Workforce Development, work as one to provide seamless service to employers and potential workers. This is exactly what the newly created Regional Workforce Alliance is seeking to do. Success requires great effort and cooperation.
- Developing new funding sources for training, including employer and expanded state and city contributions.
Creating and expanding innovative and highly responsive training programs that are built on the boot-camp model. Quick responses to explicit employer needs are essential; training time must be condensed. - Creating and expanding innovative "soft skills" training programs to assure much higher levels of entry-worker placement.
- Improving the quality of K-12 education to assure greater literacy, ability with numbers and graduation rates.
- Developing and expanding programs to interest more individuals in manufacturing careers.
- Developing more and better transportation solutions for workers to access the many geographic areas home to manufacturing.
The region cannot afford to lose the bet.
Sammis White, Ph.D., is the director of the University of Wisconsin-Milwaukee Center for Workforce Development.
