Manufacturing: Thumbs up for 2015

Posted on Jan 1, 2015 :: Cover Story
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Posted by , Insight on Manufacturing Staff Writer

Maybe it’s no surprise that manufacturers are feeling more confident about the state of their industry now that the nation has largely emerged from the dismal years of the Great Recession.

What’s more surprising is how much that confidence has grown.

Financial health, projected sales, plant modernizations and workforce hiring are all showing a significant upswing, demonstrating that the state of manufacturing is quite strong overall, according to the NEW Manufacturing Alliance’s 2015 Manufacturing Vitality Index, released in December during the New North Summit in Sheboygan.

“The increases were the highest of any year that we have conducted the survey,” says Ann Franz, director of the NEW Manufacturing Alliance.

Some of the key findings include:
» 86 percent of respondents believe they’ll see an increase in sales in 2015, and 96 percent of companies expect to be financially healthy or quite healthy in the next year
» 30 percent expect to undergo a plant expansion and 66 percent expect to modernize their plants
» 53 percent of manufacturers plan to hire in quarter one of 2015

“We’ve never seen that (hiring) number higher than in the low 40s,” Franz says. “So that was really, really exciting. It seems like our manufacturers are really seeing strong growth in their companies. They’re reinvesting that profit into their companies.”

That means more companies will remain in the state and invest more in their employees, too. The findings offer good news for young workers looking for jobs: In addition to technically trained talent such as machinists, engineers and welders, manufacturers also are on the hunt for general labor employees, meaning more entry-level positions are out there. It’s the first time the need for general labor has appeared on the index.

“We continue to see a lot of retirements as the baby boomers age,” says Mike Kawleski, public affairs manager for Georgia-Pacific. Kawleski also is the chairman of the NEW Manufacturing Alliance’s communications task force. “We physically need people to man the front lines, and for a lot of manufacturers, that’s really a numbers problem.”

That’s the one big area of concern among manufacturers — finding those workers, including those with the skills to fill the increasingly technical positions that are opening. Most manufacturers — 72 percent — think they’ll have trouble finding the right workers.

“The first year of the study, only 29 percent expressed that concern,” Franz says. “So every year, it’s gone up, but this year — I mean, that’s almost everybody. I think what’s good about that number, though, is that companies are aware that there is a skills gap, and in order to solve a problem, you have to know you have a problem.”

The alliance has been working since 2006 to develop partnerships between manufacturers and educators to help address the skills gap, such as through enhancing tech education offerings and creating more opportunities for young people to spend time in manufacturing facilities.

“Getting engaged in K12 is critical, (as is) having students participate in an apprenticeship program, a job-shadowing program,” Franz says. “So many times, companies are saying, ‘We’re too busy,’ but by making that small investment now, you’re able to find the workforce you need for the future.”

And manufacturers are not just concerned about finding technically trained workers, they’re worried about finding people with “soft skills,” the non-technical skills such as communication, decision-making and a good work ethic that translate into employability.

“I hear it all the time from companies saying, ‘You know what, I’m willing to train someone if they are able to communicate, work hard and will come to work every day,’” Franz says.

Soft skills are hard to train for, but giving students real-world experiences to show how their behavior will impact a future career can help, Kawleski says. Initiatives such as the Bay Link Manufacturing program at Green Bay West High School, a student-run manufacturing learning lab, will give students the experience of running a program, working with customers, working in teams and making business decisions.

Schools have lost many of the traditional vocational student groups and intra-curricular type student organizations that were strong opportunities to learn leadership skills, he says.

“We haven’t really had a big emphasis on that, I think,” Kawleski says. “And maybe it’s time to think about doing more of that.”

Growing pains

The need for prepared workers will only grow as industry gets healthier.

The increase in planned plant expansions and modernizations is a positive sign of financial health, but also may be a symptom of the skills gap because companies may need to improve plant efficiency as workers retire, Kawleski says.

“Having said that, you still need folks that are technically trained to operate that new equipment,” Kawleski says. “You’re looking at things that are usually much more computerized, much more complex. You need people to both operate that and to maintain that.”

And if companies had a large talent pool from which to choose workers, their confidence in expanding might increase that much more, he says.

“Anecdotally, certainly we’ve heard for the last number of years that there are a lot of companies that probably would expand even faster if they could solve the people problem,” Kawleski says. “They’re saying, ‘We could fill these orders, we could expand our customer base, but we just physically don’t have the people to operate the equipment.’”

Scott Kuehn, technical talent acquisition coordinator at Bemis Manufacturing in Sheboygan Falls, says his company is looking for good workers that don’t necessarily have technical degrees, but possess a minor amount of mechanical aptitude — and the right attitude — to learn and fit into the company culture.

“Can this person work within an environment where every voice needs to be heard?” Kuehn says. “We are very team-oriented, and if there’s someone that comes in that is not a good culture fit, they’re going to struggle.”

Kuehn is part of a partnership of other Sheboygan County manufacturers that is working with the Sheboygan School District on a new initiative to boost tech-ed offerings at the two high schools (see Education & Training). Working with educators is absolutely vital, Kuehn says. But the effort should also extend to parents.

“If you talk to any of the school systems that have either built new technical facilities or just ended up modifying and upgrading their tech centers, I think you’ll find it’s not just all talking to and familiarizing the kids with what’s going on; the parents have to kind of be reeducated also,” Kuehn says.

They’re ultimately the gatekeepers, choosing whether to support a child’s interest in a manufacturing-oriented education or career choice.

Bill Bartnik, director of manufacturing systems at Sargento and the new chairman of the NEW Manufacturing Alliance, says the alliance is focusing on continuing to change impressions about manufacturing, including through creating more opportunities to get to know what the industry is really about. The alliance wants to increase the number of plant tours for educators and students this year. It plans to host a college internship networking event at Lambeau Field on March 12.

Such events help to demonstrate the varied careers that manufacturing offers, and that continued effort is part of the alliance’s focus.

“Our main mission, and the hurdles we’re trying to overcome, are the misconceptions about manufacturing,” Bartnik says. “I feel like we’ve come a long way, but this year, we’re going to keep working on those initiatives. There are workers out there, and if they really get manufacturing and understand the career they can have, we’ll have a bigger pool to pull from.”