Thermoforming Report

New Year, Same Theme

As we hit the ground running in 2024, a similar theme remains in place: despite supply issues and labor shortages, the manufacturing industry continues to experience growth surpassing the expectations of previous years. To maintain this growth, leaders are focusing on supply chain resiliency and, critically, strategies for the future of work.

Addressing the tight labor market and workforce churn remained a top priority for most manufacturers in 2023 – and it will continue in 2024. Despite a record level of new hires, job openings in the industry are still hovering near all-time highs. Additionally, voluntary separations continue to outnumber layoffs and discharges, indicating substantial workforce churn. This workforce shortage, which is reducing operational efficiency and margins, has manufacturers pursuing several approaches to strengthen their recruitment and retention efforts.

Talent Management Approaches

Pay Increases. Talent scarcity is compelling more manufacturers to consider raising wages. Although the industry has historically had a higher baseline wage for production workers, competing industries such as warehousing and retail are increasing wages more quickly than manufacturers. This is not surprising but remains a challenge as it directly and indirectly hits profitability.

The ongoing challenge of wage creep and internal pay equity makes things hard for Human Resources teams and leaders. But it can’t be ignored. Invest the time to review your current local market conditions (hopefully in partnership with other HR leaders in your area) and determine a strategy on how to address this option.

One more thing – please, make sure to take care of your current employees first! Using the stereotypical “cable company offer” – you know the one where new customers get a MUCH better deal than existing customers – just won’t play well!

Up-Skilling and Re-Skilling. As the use of digital technologies proliferates across the manufacturing sector, the workforce increasingly needs advanced technical and digital skills. But, skilled workers are in short supply in the manufacturing industry so manufacturers are embracing re-skilling strategies and investing in startups to access new technology and talent.

This is NOT new. Continually training your team members is paramount to both their job satisfaction and typically a consistent improvement in productivity (and therefore cost). The difference is that the pace of change is much faster… which in turn means the organization must also adjust its speed to identify needs and implement training. No, it isn’t easy, but it certainly is a critical strategy to execute!

Interested in digging deeper in how AI can enhance (not detonate) manufacturing? Check out our recent article on The Artificial Intelligence… of People.

Partnering with Specialized Recruiters. Though an obvious shameless plug, this is absolutely a key strategy to leverage. Access to the right talent with the right skills and experience is imperative – especially if you can get eyes on those great people in short order. As our monthly Thermoforming Report is obviously targeted to the thermoforming world (it’s in the title after all!), Siena Group is the obvious choice. That said and knowing how connected our world is, I can’t stress enough the need to partner with highly regarded and successful niche external recruiters to find, source, and place people in the broader manufacturing world.

DEI Strategy. The industry is focusing on diversity, equity, and inclusion (DEI) to attract more women and racially and ethnically diverse groups to the workforce. Manufacturers are increasingly adding leadership that focuses on advancing their DEI goals, from meeting representation targets to creating more inclusive environments where diverse talent can build careers. 

When you are in a specific niche, it can be challenging to meet the organization’s goals in this regard. Even so, and like most things, to deliver results, you must measure the right things.  As a company, knowing where you are with regard to DEI and where you are trying to get to will help in your decision-making process. This is truly a tough one as there is a limited pool of the right people for the right role at the right time and in the right location. 

Flexible Work Arrangements. Manufacturers are actively seeking ways to structure the work, the workplace, and the workforce to adapt to the broader shifts in the overall work culture. As a hybrid work culture begins to spread to parts of the manufacturing sector, companies are exploring ways to add flexibility across their operations and implementing new ways to attract and retain workers, such as addressing factors like well-being and flexibility. 

Like everything else on this list, it is NOT easy to make this happen! 

First, and I’m being redundant here, there is no such thing as a hybrid Process Engineer… or Production Manager… or anything else that requires you to be at the plant making stuff!  As a former Process Engineer myself, it pains me to get a question from a prospective young engineer inquiring about the work hours or whether it is a hybrid type of role.  NO.  You must be there to do your job successfully! 

Second, I have a couple of great organizations that, thanks to Covid, took a hard look at things when the dust settled a couple of years later. Though they know that there are some losses from not physically being in the same space (building relationships is critical to a team’s success), they also know that to bring in the best of the best, they must be flexible in their approach. Great organizations like Brentwood Industries continues to learn and develop and grow because, like I said, it isn’t easy and is an investment. But it has already paid dividends, and therefore they are committed to this strategy! 

Improve Attrition Levels. See the previous content above! All kidding aside, assessing and understanding your attrition is key to knowing why “workplace churn” may be happening in your organization. About a year ago, I quoted Duo Form’s President Shelly Ditmer regarding her efforts to dramatically change and improve their culture and how she believed it led directly to their MFG Excellence Award in late 2022. 

Wrapping Up

Like everything already stated, there must be deliberate action to impact 2024 results in your talent management metrics. 

• Yes, it is an election year. 
• Yes, there are uncertainties. 
• Yes, there may be headwinds. 

BUT, as we roar into the new year, without taking some time and investing in your people – how to keep the great ones you have and how to add more A-level talent to your team – you will ultimately end up behind and scrambling. 

Have a great year!!! 

As your Thermoforming Talent Partner, we represent clients AND candidates! We’re here to help in any and every way possible! We provide hiring strategies, priority candidate searches, job searches, client & candidate introductions, interview tips, résumé facelifts, resignation strategies, and much much more. LET’S STRENGTHEN YOUR SEARCH!