Shalin Johnson
Business Insurance & Risk Consultant | Sales & Client/Carrier Relationship Management
The manufacturing industry has long been a critical driver of economic growth and development, employing millions of workers worldwide. However, one of the significant challenges currently facing this sector is the aging of its workforce.
As baby boomers continue to retire, manufacturers are finding it challenging to fill critical positions with qualified workers, which may contribute to a potential skills gap.
According to a 2022 survey by Parsable, 83% of recently graduated 18–24-year-olds view manufacturing as high-tech and modern. Both factors may offer an opportunity for manufacturers to innovate and reimagine their hiring and retention strategies.
What’s the concern?
Marsh McLennan Agency (MMA) manufacturing clients report that recruiting and retaining workers are among their top concerns. But what has created this situation?
Younger generations are looking for more than a paycheck.
First, the majority of the U.S. manufacturing workforce is older, with the median age being 44.3 years, according to the Bureau of Labor Statistics. When these workers retire, they may take valuable knowledge and experience with them.
The second factor is what’s come to be known as the Great Resignation—when the U.S. job “quit rate” reached a 20-year high. More than 50% of those who quit, according to a Pew Research report, were aged 18 to 49.
“Quiet cracking” has replaced quiet quitting. It is described in a report from TalentMS as a “persistent feeling of workplace unhappiness that leads to disengagement, poor performance, and an increased desire to quit.” Fifty-four percent of surveyed employees say they experience some level of quiet cracking.
What can manufacturers do?
Younger generations are looking for more than a paycheck. They often place a higher premium on finding purpose at work and challenge employers to recognize and empathize when they become disengaged or burned out. Here are a few ways you can help:
Refresh your onboarding process.
According to the Society for Human Resource Management (SHRM), employee turnover can be as high as 50% in the first 18 months of employment. That means an onboarding process that focuses less on paperwork and more on engagement can help set new hires up for long-term success. Make sure you check in often during the first 18 months to keep new hires engaged and motivated to stay, and include formal reviews annually.
Your current employees can be an important part of the onboarding and training process. Employees who have been with an organization for a long time can be a valuable resource. Engaging them as mentors and in your new-hire training programs lets you tap into their knowledge and expertise and helps the more seasoned professionals feel valued.
Help employees see a future with you.
SHRM has found that a strong and supportive culture can improve employee retention, especially in high-turnover industries. A work environment with growth and earning potential can help employees see opportunities to create a career, rather than simply working for a paycheck.
That can make new employees—as well as experienced veterans—more engaged when they can see opportunities for advancement. Use the onboarding process and regular performance evaluations to establish goals and chart a path for reaching them.
Cross-train your employees.
Allowing new workers to learn not only their jobs but also the jobs of other members of the production team helps them see how their work fits into the bigger picture. It also encourages continuous skill development, an aspect younger workers often want.
According to REWO, Cross-training can provide scheduling flexibility, promote sharing of ideas for process improvement, and help employees feel more engaged because they are building skills rather than doing one job repeatedly. It also gives employers awareness of employee skills and their desire to move into new roles.
Become an employer of choice.
A key to an effective recruiting strategy, especially to help attract younger workers, is to pay careful attention to the story you’re telling and how you’re telling it.
Use social media effectively to attract new talent. Short videos featuring your current employees can be very powerful. Invite them to share why they love their jobs, and ask a variety of employees to participate so you appeal to a wide audience.
Younger workers also want to see how your organization is active in the community. Post photos and videos of your team volunteering or attending community functions. Share information about how your efforts support your company values.
Other creative ways to recruit:
- Host an on-site career fair, and ask attendees what they want from an employer.
- Survey your employees, either informally or formally, to learn about their reasons for joining and staying with your company.
- Offer referral incentives; they can be especially helpful in recruiting in communities of color.
- Work with area schools (high schools and colleges) to create a career path and provide incentives for younger workers to join, such as reimbursement of education expenses.
The benefits of exceptional benefits
Competitive wages and benefits are more important than ever. Potential employees compare you to others in your industry as well as to other companies in your community. Taking a proactive approach to benefits, rather than reacting, can help set you apart.
For some employers, as many as five generations may be in the workplace at the same time. Each demographic segment has different needs and expectations, which can make it challenging to meet them.
Issues like childcare and caring for aging family members are creating a strain on the workforce, so employers are implementing innovative strategies including voluntary benefits.
Some of the most popular voluntary benefits identified in MMA’s internal Employee Benefits Trends report include:
- Financial planning
- Tuition reimbursement
- Backup childcare options
- Eldercare options
- Identity theft protection
- Hospital indemnity
How MMA can help
Find out how your benefits offerings compare with your competitor organizations. Our manufacturing risk professionals, working with our Employee Health & Benefits team, can assist you in exploring the challenges and opportunities presented by the aging manufacturing workforce. We can discuss potential solutions to help support your company’s goals and help ensure that the industry—and your company—remains competitive and sustainable for years to come.
