Blog: Invest in People, Robots to Better Manufacturing

Manufacturing production in the U.S. is estimated to grow 2.8 percent from 2018-2022 (a faster increase than other segments of the general economy), and manufacturing continues to have an outsized influence on regional economies. Longstanding economic analysis has posited for every dollar invested in manufacturing, the result is $1.40 in additional economic activity.
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Todd Palmer
Todd Palmer // File photo

Manufacturing production in the U.S. is estimated to grow 2.8 percent from 2018-2022 (a faster increase than other segments of the general economy), and manufacturing continues to have an outsized influence on regional economies. Longstanding economic analysis has posited for every dollar invested in manufacturing, the result is $1.40 in additional economic activity.

Along with the predicted manufacturing production output, the need for skilled workers in areas like CNC machining, fabricating, welding, and manufacturing engineers also is on the rise.

By 2025, up to 2 million manufacturing jobs are projected to be unfilled. Welding alone will need an estimated 90,000 welders around the United States by 2024, according to Lincoln Tech, a training school for welding students.

Rather than continue to either ignore the problem or complain about it, some manufacturers are taking a multi-faceted approach to bridge the gap — not only for next year but also for 15 years down the road.

They are exploring mixing robots into their workforce. They are attempting to diversify their mix of labor on the shop floor. Amazon, for example, added 40,000 industrial robot units to its fleet, along with 100,000 new humans in recent years.

One question being asked by skeptics is, “Are robots the answer for the lack of an available labor force?  Will robots replace workers?”  Surprising to many, the answer is no, according to Jeff Burnstein, president of the Association for Advancing Automation (A3).

“Hysterical stories keep being printed in the media, but the robot we see doesn’t match the idea of robots being a job killer,” says Burnstein. “If it were true, then if robot sales were to rise, you’d expect unemployment to rise. We looked at a 20-year period of manufacturing jobs and overall employment in the U.S., and every time robot sales rose, unemployment fell. Every time robot sales fell, unemployment rose.”

For those employers who need to hire human capital, there are two basic categories these hiring needs fall into:

  1. Change in the market place regarding wage and talent scarcity
  2. Attracting entry-level employees, from the shop floor to the engineering desk

How some employers are combating this for some skilled trades and even engineers is by successfully partnering with community colleges, universities, and even high-school career programs to build a pipeline of future skilled workers.

One ambitious employer, who is looking to corner the market on fresh college graduates, has introduced a three-week PTO/vacation policy for all new hires. The employer discovered that his local competitors only were offering between 10 and 14 days of vacation time to new hires. To be seen as a manufacturer employer of choice and to beat out his competition, he decided that an extra week of time off was very attractive to a millennial workforce.

An employer that uses entry-level and semi-skilled workers is running two shifts, avoiding costly overtime, and staffing their facility seven days per week.

Here is how it works:  The manufacturer runs a four-day work week for one group of employees, Monday-Thursday, 10 hours per day. Those employees work four days per week, three days off for family.

Then the manufacturer runs a second group of employees on a three-day work week schedule, Friday-Sunday, with an eight-hour attendance bonus for every employee who works all of their assigned 32 hours.  For the three-day-per-week employee who is earning $12 per hour, that is $96 per weekend attendance bonus!

They are earning a 40-hour paycheck in 32 hours of time. For the employer, assuming those eight hours would have been paid out at time and a half at $18 per hour instead of $12 per hour, they are saving $48 per that eight-hour timeframe.

Todd Palmer is founder and president of Troy-based Diversified Industrial Staffing and Extraordinary Advisors Coaching, and a regular contributor to DBusiness Daily News.

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