Three Workforce Lessons from Manufacturing Plants Around the World
By John Mitchell, IPC president and CEO
The U.S. economy has remained surprisingly resilient, and the result has been that the country’s unemployment has continued to inch lower. It’s now at 3.5 percent, the lowest rate since 1969, and that rate could go even lower as the U.S. boasts more than 7 million job openings. Those job openings suggest an opportunity for workers but a tight labor market for employers. For the industry I represent, electronics manufacturing, talent and retention have always been top concerns, but the situation is worsening. Today, more than 60 percent of U.S. manufacturers say that an inability to find and retain skilled workers is constraining their growth and undermining their global competitiveness.
The same story is true around the world. During my latest international listening tour of manufacturing plants in France, Germany, India, Japan, Taiwan and Thailand, I noted again that the challenges faced in the United States extend beyond our borders. The good news is that, through shared experience, we can develop shared insights and solutions. In that vein, I’d like to offer the conclusions I’ve drawn from my meetings with operators and managers across the electronics industry about the current labor environment:
Lesson 1: An open-minded approach to hiring based on industry interest, not just skill, can result in new long-term talent
During the recruitment process, seeking out potential employees that hold genuine interest and passion for the industry even if they don’t yet pose the skills can provide a new source to fill long-term workforce gaps. It’s okay to hire an employee with minimal training – that's where company education programs come in. In Japan, one manufacturing plant hires operators interested in the job without a background in the industry. The workers are trained with pay for a full year before joining the assembly line. Once thoroughly vetted and trained, operators have the avenue to move up through the ranks to become managers. Among the factory managers with whom I spoke, none of them had college-level training; their education was solely completed through intracompany training. As an added bonus the longevity and loyalty of this workforce is impressive, but more on that in Lesson 3. This model, used in some Japanese companies as well as others in Europe, underscores the point that we can find talent by embracing workers with little to no experience – but with industry passion – to build the worker pipeline. That is where the next key lesson comes in.
Lesson 2: Career progression is important to workers
Hiring is the first step, but companies need to keep thinking of new ways to keep employees engaged and motivated by prioritizing both their personal and professional growth. Job security and location to home remain pillars for workers within the industry. However, with a younger generation entering the workforce, convenience isn’t enough to retain workers. Workers want to know they have a career path they can build in their companies.
In Thailand, operators who lack a college education, along with management staff from top schools, can grow within their roles and continuously be promoted. The job culture there exposes workers early on to self-improvement paths that help them attain specific knowledge or capabilities. Having this type of transparency helps create trust among employees and companies, where the workers invest in the companies and the companies invest in the workers.
During my latest trip, I spoke with college-educated engineers who expressed appreciation for their companies’ focus on personal growth. One manager emphasized that it was during his time as a quality engineer that he learned how to meet his goals and prioritize learning additional skill areas, allowing him to become a senior production manager.
Lesson 3: Worker retention relies on effective workplace communication to maintain worker happiness
As I engage with workers and management, I’m always reminded that companies address and troubleshoot challenges in the workplace in a variety of ways, and how they do so impacts the employee experience. A successful environment champions collaboration to lessen the stress placed upon employees closest to the supply chain or any other production issues at hand. In Bangalore, India, I saw how deliberate and collaborative employee interaction could solve product processing challenges.
For more arduous job tasks, such as accommodating factory capacity, maintaining various product delivery schedules and facilitating cross-department collaboration, a company systemized procedure review. When they encounter an issue, operators stop the production process, brainstorm solutions, bring these potential solutions to a quality assurance team and then implement the changes through a management system in place, fostering a new type of learning environment with its people and collaborative problem-solving at the core. The success this brings isn’t just apparent through workers’ happiness and loyalty – their mantra of “zero defects,” helps ensure their products demonstrate the highest quality standards through their production process.
Conclusion: Lessons can be learned on a global stage to ensure company efficiencies and worker satisfaction for future growth
Seven million jobs unfilled is a staggering number, but U.S. economic growth and innovation hinges upon addressing this workforce need. Companies are stepping up through commitments to hire interested but untrained workers, employee initiatives geared toward career progression, and c-suite focus on finding ways to retain workers. These initiatives are helping to drive record growth in the electronics industry.
But the U.S. industry should take note of the lessons I saw around the world. For too long, countries have been resistant to learn lessons from others. But with our ever-shrinking globe and ever-expanding workforce, our neighbors have solutions that should be embraced.