Manufacturers discuss solutions as skilled trades gap widens and hiring shortage continues

You’ve probably heard about the skilled trades gap in Michigan, but just how big of a gap is it, and is the gap really getting bigger?

Well, in 2015 a press release from former-Gov. Snyder’s office stated, “Skilled trades jobs overall, including manufacturing, are some of the most in demand jobs as employers face a growing need for talent. More than 6,700 job openings are expected every year through 2022.” Fast forward to May of 2021 as Gov. Whitmer announced that May would be recognized at Professional Trades Month in Michigan. The resolution stated, “…professional trades will account for nearly 530,000 jobs in the Michigan economy through 2028, and approximately 47,000 job openings are expected annually in the state during that time.”

In just six years, there has been a jump from an estimated 6,700 open skilled trades jobs annually to 47,000 open skilled trades jobs annually. While this gap existed before the COVID-19 pandemic and the pandemic can’t be blamed for the situation in its entirety, it didn’t help resolve the problem either. Now, as manufacturing is facing an increase in demand post-pandemic, many manufacturers are experiencing an employee shortage at a less-than-ideal time.

Harry Leaver, Executive Director of the Central Michigan Manufacturers Association.Our growth in manufacturing has been for the most part stymied by the shortfall of people,” says Harry Leaver, Executive Director of the Central Michigan Manufacturers Association (CMMA). “That's the biggest issue that most of our manufacturing businesses are struggling with today.”

While day-to-day operations are critical, some manufacturers are more concerned with the impact this hiring shortage will have on their operations in the future.

“For the day-to-day operations, we’re doing ok. We have enough employees to get us by,” says Jeff Jacques, American Mitsuba Corporation Plant Manager. “What I worry about is succession planning and employees that we’d love to be training right now but don’t have the opportunity to because we haven’t filled those positions yet. So, even though we don’t have an immediate impact of this difficulty of obtaining employees, I have a feeling that down the road we’ll have to address this problem again.”

While the skilled trades gap and the hiring shortage in Michigan each have many facets – far more than can be covered in a single article – many manufacturers are focusing on various approaches to two main solutions: recruiting talent and retaining talent.

A large portion of manufacturing recruitment efforts are focused on recruiting younger people to the industry as a whole, which can be seen at MidMichigan College's Morey Technical Education Center.

Recruiting Talent

Jacques knows all about recruiting talent lately, as the American Mitsuba Corporation plant in Mt. Pleasant hired 52 people between September 2020 and June 2021.

“Not only did we do a wage increase across the board at several different tiers, but we also have a competitive benefits package to offer employees,” he says. “A lot of them are drawn in by that, as well as the stability of our company through something as terrible as COVID-19.”

While a significant part of talent recruitment efforts involves attracting people to a specific job in manufacturing, another large portion of those recruitment efforts are focused on recruiting younger people to the industry as a whole. With 49% of the country’s manufacturing workforce over the age of 45, according to the Bureau of Labor Statistics, recruiting younger talent to the industry is an effort that will continue to be critical over the coming 10-15 years.

Leaver says a big part of this is changing the perception of jobs in manufacturing – perceptions held by young adults as well as their parents.

He says, “If you're sitting at the kitchen table with your children and you start talking about where they should be setting their sights for the future, are you suggesting to them that they can consider a job in manufacturing?”

Leaver explains that when some of Michigan’s automotive factory jobs started to go under, parents and educators began telling kids that they needed to focus on higher education. The days of being encouraged to go work in the factory “like dad” because the family had a good lifestyle off of the job that dad had were fading.

With 49% of the country’s manufacturing workforce over the age of 45, according to the Bureau of Labor Statistics, recruiting younger talent to the industry is an effort that will continue to be critical over the coming 10-15 years.

“I think one of the things that happened was we went from this mindset of saying, ‘Working in manufacturing is a good thing’ to all of a sudden ‘Working in manufacturing is a bad thing,’” says Leaver. “There's still a perception that it is dirty, dangerous, and that's a dead-end job that doesn't pay much - just enough to get you by. But, now, we have to get people to come back to the reality of what the real world is out there – that they can make great money.”

Leaver says part of those recruitment efforts and the effort to change the perception of the industry is taking place as colleges integrate more training in Industry 4.0 – referring to the fourth industrial revolution and the ongoing addition of technology and automation to manufacturing and industrial practices. For example, MidMichigan College recently acquired Industry 4.0 training equipment, something Leaver is looking forward to seeing put to use.

“Those are the kinds of things that I think you're going to be seeing more and more of and it's going to create a shift in that mindset,” says Leaver.

Benjamin Simmons, CEO of Highland Plastics, Inc.Some mindsets may already be shifting at local businesses, and hopes of seeing a return to the days where kids are encouraged to work at the factory “like dad” may not be too far off.

At Highland Plastics, Inc., 20% of the company’s employees have another family member that works there.

“We employ lots of people here from the same family,” says Benjamin Simmons, CEO of Highland Plastics, Inc. “Once they get in and like it, they encourage their families to join.”

Retaining Talent

Once you train talent locally or have those individuals at your business, naturally the next question is, “How do we keep them here?”

This is something Simmons says he has focused on – something he doesn’t view so much as an effort to retain talent as an effort to protect it. As part of that protective effort, Highland Plastics, Inc. raised wages last year in addition to the benefits package they provide.

“Highland Plastics is a plastics manufacturer. People pay us to make plastic. But, the purpose of the business is not to make plastic; the purpose of the business is to provide employment and to provide meaning and stability to as many families as possible,” says Simmons. “I think this protective attitude is going to foster the goodwill that leads people to stay and attract people that want to work here, and I think that's reflected in the caliber of applicants we get.”

Adam Garcia, who has worked at Highland Plastics, Inc. for 16 years, inspects material coming off of the machines.

Simmons explains that he isn’t seeing a hiring shortage impacting his operations, which he attributes to the work environment at Highland Plastics, Inc. as well as their procedures throughout the pandemic.

“We were fully staffed going into COVID… We paid everyone to stay home. That meant that when the work came back we retained the institutional knowledge held by our workforce and they were willing to come back and work,” he says. “We've been doing some recruiting because we're experiencing natural attrition as people kind of move to other states and things like that, and we haven't had an issue with either the quantity of applicants coming in or even the quality of applicants coming in.”

However, Simmons does think the hiring shortage being felt by many manufacturers could have some implications for the future of the industry.

“I hope that this impacts manufacturing in the long-term,” he says. “I would like to see an environment where all of our competitors - whether they're competing for our customer's business or for the labor of people in the area - are raising their compensation standards. If this is what it takes to get that done, then I support it.”

Simmons says he believes now is the time to push for improvements as the effect of the pandemic on the global supply chain has demonstrated the importance of re-shoring and supporting American manufacturing and making sure that domestic production is using domestic supply.

“As we re-shore industry, surely now's the time to make sure that we can improve the living standards of people that work in America,” says Simmons. “And, if now's not the time, then when is?”
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