Addressing the Manufacturing Labor Shortage and Hiring the Right Workers

Addressing the Manufacturing Labor Shortage and Hiring the Right Workers

Addressing the manufacturing talent shortage isn’t just about filling open roles. It’s about finding the right workers for your business.
Contributors
Brian Kramer, Underwriting Officer, Manufacturing Industry Practice Lead, The Hartford
Brian Kramer, Underwriting Officer, Manufacturing Industry Practice Lead, The Hartford
Amber Walton
Amber Walton, Head of Product Development, Health Services, The Hartford
As the manufacturing industry faces a talent shortage, it’ll take a multi-faceted approach to address the issue. But it’s not as simple as finding people to fill open roles. Finding the “right” worker is essential to a manufacturing business’ success and employee safety.
 
The manufacturing unemployment rate spiked at the start of the COVID-19 pandemic, where it reached 13.2% in April 2020.1 Since then, the unemployment rate dropped and has stayed stagnant at about 3% from October 2021 to April 2022.2
 
Despite this, there’s growing concern that the high number of manufacturing jobs in the U.S. will remain unfilled. One source states there will be 2.1 million unfulfilled jobs by 2030 and that the millions of jobs lost early in the pandemic set the manufacturing industry back by more than a decade.3
 
“Before the pandemic, the manufacturing industry was already struggling to find workers; the COVID-19 pandemic made it worse,” said Brian Kramer, manufacturing industry practice leader at The Hartford. “When it comes to finding the ‘right’ worker and retaining talent, it comes down to job safety, coachability, alignment with the organizational culture and a focus on employee health and wellness.”
 
From focusing on workplace culture to creating a comprehensive training program to improve safety, it’ll take time and effort to find the “right” worker and retain talent. But these factors are what professionals at The Hartford believe can help address the manufacturing talent shortage.
 

Why Is There a Shortage of Manufacturing Workers?

There’s not a simple answer for why there is a shortage of manufacturing workers. The pandemic fueled a phenomenon known as “The Great Resignation,” where large numbers of workers voluntarily left their jobs. At the same time, many manufacturers shut down during the height of the pandemic, causing millions of workers to lose their jobs.
 
The Hartford’s 2022 Estudio sobre el futuro de los beneficios shed a light on the differences in opinion between U.S. workers and employers about company culture and retention. While 96% of employers believe they’re taking steps to retain talent, only half of workers agree.4
 
As COVID-19 evolves, some manufacturers are working through backlogs or trying to meet and maintain elevated levels of demand for certain products. This elevated demand is continuing to cause pressure in a tight labor market, Kramer said.
 
“There’s been a rush in demand for certain manufacturers that the pandemic made a little worse, like building materials and food processor as a few examples,” Kramer said. “And we’re continuing to see people reevaluating their priorities in life. Some continue to exit or retire from the workforce.”
 
Kramer added that other employees may be sitting on the sidelines and waiting for the right opportunity to re-enter the workforce.
 
Another driving factor to the talent shortage is the availability of certain skills in the marketplace. Depending on the manufacturer, jobs can require a high level of skill, which may not be readily available.
 

A Need for Jobs Even in the Technology Age

Many manufacturers are continuing to embrace technology.
 
“While traditional production and assembly lines still exist, many manufactures have embraced technology, robotics and artificial intelligence in their production process, which actually makes this a really exciting time to enter the manufacturing field,” Kramer said. “Advanced manufacturing facilities will continue to drive the need for highly-skilled roles. But a majority of all manufacturers have fewer than 100 employees. So, for the foreseeable future, I think we’ll continue to have traditional production operations.”
 
Whether a manufacturer has a traditional operating model or uses technological advancements in its facilities, there’s a need to make sure the person is able to do the work.
 
“Even if a manufacturer is using robotics, there’s likely still positions that require a person. There are jobs that can’t be replaced with robotics or machines,” said Amber Walton, assistant vice president of product development for Health Services at The Hartford. “Making sure the person you hired to fill that role is able to do their job correctly and safely is important.”
 

Finding the ‘Right’ Worker to Address the Talent Shortage in Manufacturing

Addressing the talent shortage in manufacturing isn’t as easy as just trying to fill open positions. If you don’t find a worker that’s a good fit and who can do the job properly, it can impact a business’:
 
  • Productividad
  • Workplace safety
  • Operations and efficiency
It’s not uncommon for people who are new to the industry to fill entry level manufacturing jobs. But it’s inexperience that greatly increases risk for injury. In fact, The Hartford’s workers’ compensation (WC insurance) claims data showed employees with less than one year of experience drove about one-third of claims.5
 
Even people who have manufacturing experience can be at an increased risk of injury if they’ve been out of work for some time, Walton said.
 
“They may not be as conditioned to work as they were pre-pandemic,” she noted. “This can be an opportunity for a higher risk of injuries in the workplace.”
 
Kramer emphasized that employers need to recognize this and have a plan to reduce risk.
 
“Having an effective and detailed training and onboarding process lays the foundation for high employee morale, safety and success,” he explained. “New employees need to learn what the role entails. Workers that go home safe from work every day, that’s what we hope for. That’s why onboarding and having a formalized training within the first 60 to 90 days of employment is critical.”
 

Assessments and Tools To Help Find the Right Workers

One way to make sure a person can do a job is through an assessment. Through its onsite and virtual injury prevention services (IPS), The Hartford provides tools that can help employers run a safe workplace. The insurer partners with clinical partners, like Unify Health Services, to deliver proactive injury prevention solutions, first-aid treatment and overall wellness support.
 
IPS includes a variety of services, such as:
 
  • Access to experienced medical professionals
  • Physical demands analysis (PDA)
  • Physical ability testing
  • Industrial ergonomic assessments
  • Fit-for-duty testing
“Manufacturers are hiring individuals that have to be industrial-athletes at work. They’re in roles that are physically demanding all day for five days a week,” Walton explained. “We’re trying to help mitigate that risk for injuries by providing objective tools that they can put in their workplace.”
 
A physical demands analysis (PDA) is a foundational tool employers can use when developing a safety program. A PDA evaluates the physical requirements of a specific job. It measures the:
 
  • Physical tolerance requirements to perform essential and marginal job tasks
  • Maximum force requirements
  • Positional tolerances
  • Machinery, tools and environmental factors
Manufacturers and other employers can also use a PDA during the hiring and onboarding process, which can be an expensive and time-consuming process. In fact, the average cost per hire in 2022 is nearly $4,700.6 Companies who performed a detailed PDA of their jobs and know the physical demands can test to those needs.
 
“Post-offer and pre-hire testing not only helps provide the potential employee an idea of the demands, but also demonstrates the ability to perform the job demands. If the potential employee does not have the ability to perform a particular job, then it’s likely not the right fit for them,” said Anne Felts, director of innovations at Unify Health Services. “The presence of a solid PDA provides the employer with a defensible and safe platform for new-hire testing.”
 
Walton also noted that the physical demands analysis can also help if there is a workers’ comp claim.
 
“Many times, physicians are making decisions today based on what the injured worker or a supervisor tells them about the job duties,” Walton said. “The PDA can be given to the physician to help them evaluate what the job duties are and assist in returning to work.”
 

Creating a Culture To Attract and Retain Manufacturing Talent

Creating a positive workplace culture that’s focused on safety and employee success is critical. Since the start of the pandemic, manufacturers have placed more of a focus on employee health and wellness, Kramer explained. How well an employee fits in with an organization and whether they’re happy at work and contributing to a positive culture is key.
 
“How you treat your employees matters,” he explained. “Focusing on safety and offer career progression to workers to give them the opportunity to grow – those are things that can help employers find and keep the right kind of workers.”
 
But it’s not just about making sure workers are physically healthy. Taking a holistic approach and looking at employee mental health is equally important. The pandemic increased people’s feelings of anxiety and depression. In fact, global prevalence of anxiety and depression increased by 25%.7
 
Walton noted that offering programs like IPS demonstrates to employees that a manufacturer is serious about their workers’ overall health and wellness.
 
“When an employer can connect the dots that employee safety and well-being have a direct correlation to their mental health and overall morale, that’s when they’ll start attracting and retaining talent,” Walton said. “With IPS and the different services that employees have immediate access to, it really sends a message from the employer that they care about their employees and they’re trying to keep them happy and safe at work.”
 
 
 
La información proporcionada en estos materiales brinda información general y de asesoría. It shall not be considered legal advice. The Hartford does not warrant that the implementation of any view or recommendation contained herein will: (i) result in the elimination of any unsafe conditions at your business locations or with respect to your business operations; or (ii) be an appropriate legal or business practice. The Hartford assumes no responsibility for the control or correction of hazards or legal compliance with respect to your business practices, and the views and recommendations contained herein shall not constitute our undertaking, on your behalf or for the benefit of others, to determine or warrant that your business premises, locations or operations are safe or healthful, or are in compliance with any law, rule or regulation. Readers seeking to resolve specific safety, legal or business issues or concerns related to the information provided in these materials should consult their safety consultant, attorney or business advisors. All information and representations contained herein are as of July 2022.
 
1, 2 U.S. Bureau of Labor Statistics, “Databases, Tables and Calculators by Subject: Unemployment Rate – Manufacturing Industry, Private Wage and Salary Workers”
 
3 National Association of Manufacturers, “2.1 Million Manufacturing Jobs Could Go Unfulfilled by 2020”
 
4 The Hartford’s 2022 Future of Benefits Study
 
5 Based on workers’ compensation claims data from The Hartford
 
6 SHRM, “The Real Costs of Recruitment”
 
7 World Health Organization, “COVID-19 Pandemic Triggers 25% Increase in Prevalence of Anxiety and Depression Worldwide”
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