Tag: Future of Manufacturing

Posted on Jan 16, 2018

Educators, students, parents and manufacturers need a wake-up call. Technology education has improved manufacturing processes in recent years — sometimes in quantum leaps — but education isn’t keeping pace with the technological strides. And that’s leading to a talent gap that is becoming difficult to bridge.

There is a significant shrinking in the number of manufacturing workers. Part of the reason for the decline is that technology has eliminated many jobs. Another is a reduced interest in manufacturing work.

Stuck in the Industrial Age

Why? The manufacturing industry faces an image problem. There is a widespread perception that all jobs in the industry are dirty and dangerous, unstable, low-paying and likely to be the first sent offshore. As a result, young people don’t pursue careers in the field. This dampens motivation to expand education efforts.

Our education system places far too little emphasis on smart, connected product manufacturing, advanced material development and digital design integration in manufacturing. Instead it is stuck in the era of metalworking and welding.

As a result, students — your next potential employees — may not be aware of exciting developments like 3D prototyping and printing taking place within the industry. And those advances will create a multitude of new careers. It’s clean, exciting and challenging work, but few people know much about it.

Clearly, there is a pressing need for updates and improvements in education and training of manufacturing technology. But there is no real consensus on how to improve education and training in manufacturing. The industry is at a crossroads.

Currently, most technical training in the manufacturing field takes place at two-year technical, community or junior colleges. But there is little coordination between the schools, so the curriculums may veer all over the map. Little thought is given to a common goal.

In some cases, however, school programs link to companies involved in targeted manufacturing in certain parts of the country. For example, you may find education-company links in Rust Belt areas known for auto manufacturing and the Northwest for the aerospace industry. However, in regions where there is no dominant manufacturing force, two-year schools might not offer any courses in manufacturing technology.

The Online Role

Online education could play a more prominent role, but it’s been off to a slow start. Typically, online course are made available in computer programming, network management and other tech-driven studies. But manufacturing technology has been either minimal or nonexistent at most two-year colleges that offer online training.

There are exceptions. The Francis Tuttle Technology Center, based at three campuses within the Oklahoma City area, provides vocational and technical training to students, including middle-aged adults. The center offers several courses relating to manufacturing, such as advanced manufacturing, welding, precision machining and computer numerical control (CNC) programming. Some of the course work is done online.

Another example of progress is the Advanced Technology Education Center, an association of 39 specialized education organizations across the nation that focus on technical education. They generally target specific industries like auto manufacturing or are linked to a two-year community college.

Despite these inroads, the relative slow pace of advancement is frustrating. What’s more, the impact from education and training is far from immediate. There is a long lead time until educated workers actually make their mark in the workforce.

In the not-so-distant past, “replacement” employees in manufacturing were plentiful and turnover wasn’t as detrimental. Now it’s imperative for manufacturing firms to become more aggressive in strategic planning.

A Brighter Future?

If manufacturing is to be revitalized, with technology education gaining a stronger foothold, the various stakeholders must pitch in. To this end, here are six practical ways that can brighten the outlook.

1. Greater coordination is needed from federal, state and local government offices that can provide incentives to encourage manufacturing technology programs. If these branches of government work together, manufacturing technology training will be enhanced.

2. Manufacturing firms must reach out to junior and community colleges in an effort to stimulate education. Those colleges may not be fully aware of the shortage in trained workers and could be persuaded to pursue this avenue.

3. Two-year colleges should establish connections with businesses; it’s not a one-way street. By consulting with employers, the schools can structure curriculums to better match the needs and wants of the manufacturing sector.

4. Online education must be expanded on the college level. While this is particularly critical for the two-year schools where most manufacturing technology education takes place, it could be extended to include four-year colleges and universities.

5. Industry leaders need to show a more active presence, advocating for manufacturing technology education. Organizations such as the National Association of Manufacturers may be able to strengthen the public profile, and increased publicity should lead to more interest in the sector.

By learning about the possibilities, including a chance at a rewarding and fulfilling career, students will be more inclined to pursue degrees in manufacturing technology or at least take courses relating to the discipline. Educational efforts can also help parents and school counselors better understand how students can benefit.

With all these stakeholders pulling together, education can move forward and begin to catch up with the technology, which continues to evolve at breakneck speed.

Changing Corporate Culture

A confluence of events has put the manufacturing industry in jeopardy, but advances in technology can stem the tide. The key is to work up from the ground floor to impart the knowledge and education required to take advantage of the new technology. This changing of the corporate culture is one of the main challenges facing manufacturers in the coming years.

Lessons from Abroad

Perhaps the United States can take a page out of the book of its foreign counterparts.

Technical education has a higher priority in other parts of the world, especially in the German-speaking enclave of Germany, Switzerland and Austria. Consider the common attributes in those three countries:

  • Early introduction of technology-based training to students,
  • Numerous internship or apprenticeship programs where on-the-job training is mixed with classroom courses,
  • Strong connections with employers,
  • Comparable educational offerings in different regions of the countries, and
  • A cultural tradition encouraging industrial and technical careers.

This priority put on technical education isn’t just limited to a small part of Europe. Other countries — including Australia, Mexico and the Scandinavian nations — emphasize vocational education. The U.S. should pick up the pace.

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Posted on Mar 20, 2017

Good old-fashioned paper is continuing to return to the manufacturing process.

 

For some companies, environmental concerns prompted the switch back to paper from styrofoam peanuts, bubble film and other plastic-based materials in packaging since paper is recyclable and reusable.

Other manufacturers discover that customers are dissatisfied or simply refuse to accept shipments packed in plastic. This is the case in certain parts of Europe and states that have landfill restrictions, such as California. Customers and employees also appreciate the cleanliness of paper and its lack of static electricity, which can annoy handlers and be hazardous to electronic equipment.

Switching back to paper, of course, requires spending money on machines that process paper into fill, cushioning, carton linings and product wrappings. But that initial investment is likely to be offset by critical, long-term financial benefits. Here are a few:

  • Labor and material costs drop. Kraft paper is slightly less expensive than plastic peanuts. But the major savings comes from labor. Packing speed is quicker and handling is trimmed, with fewer trips between the warehouse and packing area.
  • Storage needs decline. Foam peanuts require vast amounts of space, while paper stays compactly rolled up until it is put into the processing machines, creating just-in-time packing material.
  • Cleaning costs fall. Paper produces little dust, while peanuts create particles that settle everywhere on equipment and floors.

The paper processing systems are broadly adaptable to fit different production environments. Some of the potential benefits include:

  • Flexibility. Dispensers can be set up in work cells, over conveyor lines or packing tables.
  • Ease. An operator presses a foot pedal to dispense, crumple and cut the paper to a pre-set length. Automatic lifters can take the strain out of handling the heavy rolls and operators can replace an empty roll quickly.
  • Adjustability. Both the speed of dispensing and length of paper can be altered.

One Example

A converter machine can turn a 30-inch-wide, three-ply roll of paper into 8-inch-wide pads that are suitable to replace the bubble film protecting shipments.

One manufacturer of medical instruments experienced an 18 percent drop in material costs after the switch from plastic to paper. In addition, the manufacturer found the pads require less space than bubble film to provide the same level of protection, allowing the company to trim its carton size by as much as 25 percent. This, of course, reduced shipping costs.

Consider all the issues involved in using paper packaging versus other materials. Getting rid of plastic and peanuts can save space, the environment and money.

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Posted on Dec 14, 2016

The tide in the manufacturing sector may be turning — at least for larger companies. According to the third quarter Manufacturing Outlook Survey from the National Association of Manufacturing (NAM), large firms (those with 500 or more employees) are more upbeat about their outlook this quarter.

However, small manufacturers (those with fewer than 50 employees) and medium-sized ones (between 50 and 499 employees) experienced declines. Optimistic views are less common among the smallest firms, with just 48.7% having a positive outlook, down from 56.1% in the previous quarter.

Sentiments expressed by respondents have generally stabilized after several quarters of pessimism. What’s more, the data appears to back that assessment, albeit with some caveats, especially as to concerns over rising health care costs and modest growth rates expected in 2017. Overall, the current economic outlook of manufacturers could be characterized as “cautiously optimistic.”

Prime Considerations

In total, 338 manufacturers from all parts of the country participated in NAM’s third quarter study, including a wide variety of sectors and size classifications. Based on the latest data (collected during August), 61% of manufacturers are either “somewhat” or “very” positive about their company’s outlook, down slightly from 61.7% in the June report. Nevertheless, this outlook remains stronger than it was at the end of 2015 and the beginning of 2016.

At the same time, this is the fifth consecutive quarter when positive responses about the outlook have fallen below the historic average of 73%. The index has been below 50 over that timeframe, dipping from 42.3 in June to 41.8 in the recent survey.

Sales and Production

Size differences also are reflected in sales and production expectations. Small firms anticipate sales growth of 1.3% over the next 12 months, but medium and large firms expect an average increase of 2.1%. For production growth, the anticipated difference is 1.6% for small manufacturers as opposed to 2.2% for medium and large companies.

With all firms, sales and production are expected to grow by 1.9% (small) and 2.1% (medium and large) over the next 12 months, up from 1.6% and 1.5%, respectively, from the second quarter. Most importantly, the percentage of respondents expecting sales declines dropped from 23% in the previous report to 16.2% in the recent report.

In addition, plans for capital investments tend to vary according to size. Small manufacturers expect capital spending to decline 0.3% in the next year, while medium and large manufacturers expect capital investment to grow 0.8% and 1.5%, respectively.

Hiring Plans

The survey reports that many firms plan to hire additional workers to meet their cautiously optimistic growth expectations. Full-time employment levels are expected to grow 0.4% over the next year, an improvement of 0.2% from the previous survey.

Many manufacturers (28.5%) expect to hire new workers over the next 12 months, but 52.1% expect no growth in their workforce. Despite lackluster sales and production growth expectations, small and medium-sized manufacturers plan to be more proactive about hiring (anticipating a median increase of 0.6%) than their larger counterparts (who anticipate a median decrease of 0.1%).

The amount that manufacturers invest in stocking their warehouses with materials and finished goods can be an indicator of whether management is stockpiling for an anticipated increase in revenue — or it’s cutting back to conserve working capital during an expected slowdown.

The survey found that, overall, manufacturers plan to decrease inventories by 0.7% over the next 12 months, the sixth consecutive quarterly decline. A closer look at the responses show that about one-third of respondents (34.1%) plan to reduce their inventories, but 20% plan to invest more money in inventories.

Top Challenges

Nearly three-quarters of manufacturers surveyed cite rising health insurance costs as their top business challenge. They see costs increasing 8.5% over the next 12 months, up from 8.3% in the previous survey. Specifically, 75.2% expect an average increase in premiums of at least 5% next year, with 40.3% predicting average costs to jump by at least 10%. Small and medium firms anticipate greater increases (9.4%) than large manufacturers (6.3%).

Respondents also list an unfavorable business climate as a major concern: 73.6% placed it as the primary challenge behind health care costs. Furthermore, manufacturers continue to be frustrated with the lack of comprehensive tax reform and a perceived regulatory assault on business. (See “Cutting through the Red Tape” at right.) Just over three-quarters (76.6%) think the United States is on the wrong track, with only 6.8% saying they feel we’re heading in the right direction. The remaining respondents are uncertain about the industry’s current course.

Coming Soon

NAM publishes its Manufacturing Outlook Survey at the end of each quarter. The next survey, for the fourth quarter of 2016, is expected to be released on December 7.

Cutting Through the Red Tape

The Manufacturing Outlook Survey addresses the issue of regulatory challenges. Most respondents (88.8%) either somewhat or strongly disagree that the federal government carefully considers interests of small business owners when it imposes new regulations

Among other drawbacks, the manufacturers surveyed believe that government regulation:

  • Stifles economic growth (69%),
  • Disproportionately hurts small businesses (39.2%),
  • Creates bureaucratic red tape (34.3%),
  • Slows innovation (18.5%), and
  • Costs taxpayers money (15.2%).

Most manufacturers recognize that the government needs to implement rules to help protect the environment, provide a safe workplace and ensure fairness in competition. Yet, many believe that the cumulative costs of ever-increasing regulations outweigh the perceived benefits.

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Posted on Apr 11, 2016

Women in ManufacturingWomen are sorely lacking in the manufacturing industry, according to a recent survey. They make up 47% of the U.S. workforce, but just 27% of workers are women in manufacturing jobs.

An annual survey commissioned by the Manufacturing Institute and others takes a look of this disparity and highlights some interesting points. The Institute, which works to develop manufacturing talent, conducted a survey of 600 women across a broad spectrum of the industry to try to understand why this gap exists.

Persuasive Argument for Attracting and Retaining Women in Manufacturing

The argument for attracting and retaining more women in manufacturing is compelling: They represent a vast untapped pool of workers that can help to fill a talent gap. Manufacturing is facing a shortfall of an estimated 2 million workers over the next decade, and a recent skills analysis referenced by the study shows that six out of 10 positions in the sector are currently unfilled due to a skills gap. It’s clear there is a place for more women in the sector.

And women are underrepresented in virtually every sector within the industry, from industrial and consumer products to technology, media, telecommunications and chemicals. In addition, the portion of women in leadership roles lags most other industries.

The respondents to the survey exhibited certain traits that are generally viewed as favorable when seeking new hires. Among them, the women:

  • Were experienced, with nearly 90% having more than 10 years experience and 47% with more than 25 years.
  • Held supervisory positions (65%),  including director (15%) and C-suite executive (12%).
  • Were well educated; about 75% had bachelor’s or master’s degrees, and about 66% studied general business, engineering or operations.
  • Were ambitious, with the majority aspiring to be senior managers or reach the C-suite (of those, 82% said they see a career path to get there).

Motivational Tools

Seven out of every ten women participating in the survey said they’d stay in manufacturing if they were to start their careers today. Only three out of ten said they’d take a different career path. For those who might leave, the main reasons were poor working relationships, lack of opportunities and low compensation.

When asked to list the benefits that are most likely to attract and retain female workers, the respondents listed the following three items as key:

  1. Flexible work practices,
  2. Formal and informal mentorship and sponsorship programs, and
  3. Identifying and increasing visibility of key leaders who serve as role models for employees.
    Respondents were also asked which industries are superior to manufacturing in attracting and retaining women. Here are their answers:
  • Retail (38%),
  • Consumer products (22%),
  • Life sciences and medical devices (20%),
  • Technology, media and telecommunications (14%), and
  • Others (6%).

Interestingly, 42% of the respondents represented women in the industrial products, process and transportation sectors, and none of those wound up in the list.

Furthermore, about 66% of the respondents indicated that their companies don’t have active recruitment programs to attract women and only about 33% said they believe that their company is good at recruiting, attracting and developing female workers. Notably, 71% believed that there is a pay gap between women and men. All those sharing this belief said men are paid more.

Six Steps for the Future

Only 12% of the respondents believed that the K-12 educational system actively encourages female students to pursue careers in manufacturing and 53% said that it doesn’t. A similar recent study from the Manufacturing Institute echoes the results with only 40% of the respondents stating that today’s students are qualified for a job in modern manufacturing.

Yet the studies also show that industry familiarity would foster a positive perception. The best path forward, according to the respondents, is based on these six steps:

  1. Start at the top. Any change in corporate culture must start in the C-suite. For diversity to have real meaning, executives must demonstrate their belief in programs and lead by example.
  2. Eradicate gender bias. When promotions arise, women should be placed on an equal footing with men and should be compensated in kind.
  3. Create a more flexible work environment. By accommodating a better balance between work and family, manufacturers improve the likelihood of attracting and retaining women.
  4. Facilitate sponsorship. A sponsor helps a worker develop and progress professionally. In addition, sponsors extend beyond mentoring and coaching to being a vocal advocate, enhancing a worker’s presence in the organization.
  5. Begin recruitment early. The survey cites a current lack of confidence in the education system. Manufacturers should begin recruitment in secondary school to encourage manufacturing careers.
  6. Promote personal development. Offering women challenges and opportunities to succeed is part of what will make manufacturing an attractive option.

Perceptions May Change

Granted, women in manufacturing have made great strides. But there still is a long way to go. As the industry continues to evolve, perceptions may be changed from both the male and female perspectives.

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