As the U.S. manufacturing industry continues to move onshore, American workers are responding with a brighter economic outlook, an increased willingness to job search and greater confidence in their current employers. Randstad's Manufacturing & Logistics Employee Confidence Index, a measure of overall confidence among U.S. workers in this sector, reached 53.2 in the third quarter of 2014-the second-highest reading since the end of 2012. Randstad's quarterly index provides a snapshot of the latest workforce trends among manufacturing and logistics workers across the country. It is calculated from four components that reflect aspects of employee confidence. A reading above 50 indicates a positive confidence level. The index tracks key job indicators, such as whether workers feel confident in their current jobs, if they plan to job hunt within the next year and their level of confidence in the overall economy.

The increasingly positive outlook among employees comes as no surprise. For the first time since the late 1990s, the manufacturing industry is growing in a trend known as “insourcing,” in which companies not only bring jobs back onshore but also make additional investments in the United States. As a result, a greater number of manufacturing and logistics workers have expressed confidence in the strength of the general economy over the past year, with the number of survey respondents feeling confident climbing from 26 percent in the third quarter of 2013 to 31 percent in Q3 2014.

Experts Forecast Industry Growth Throughout 2014
The U.S. manufacturing resurgence continues to create a need for more qualified candidates in our nation’s factories. According to a recent survey from the Institute of Supply Management, respondents from several industries predict that manufacturing employment will increase 1.5 percent during the remainder of 2014, with 38 percent of respondents expecting employment to be 6.6 percent higher through the end of the year.

The number of manufacturing and logistics workers who are willing to look for a new job has increased over the past year. More than a third (36%) of workers surveyed said they would seek new employment within the next year, climbing six percentage points from the third quarter of 2013. In our business, we’ve seen increased demand for skilled manufacturing and logistics talent, especially for industrial engineers, sales representatives and first-line supervisors of production, with many of our candidates having the good fortune of choosing between multiple job offers.

Over the past year, the number of employees who feel positive about the future of their current employers climbed from 53 percent in Q3 2013 to 57 percent in Q3 2014. Coincidentally, those same employees have also expressed a greater willingness to job hunt, with more than a third (36%) indicating that they plan to look for a new job within the next year, an increase of six percentage points from Q3 2013.

Skills Gap a Persistent Concern Among Hiring Managers
A persistent concern among industry leaders is the growing skills gap. The Society of Manufacturing Engineers (SME) has stated that manufacturing education is “in crisis” and needs to be made a national priority, especially in the science, technology, engineering and mathematics (STEM) fields. Enhanced educational efforts are necessary to establish a pipeline of skilled talent that the industry critically needs as it faces an aging workforce. In fact, SME experts predict that the lack of skilled factory workers could result in upwards of three million open jobs by 2015 due to older workers retiring. According to a recent study by the Boston Consulting Group, the average age of a highly skilled U.S. factory worker is 56.

Additionally, in Randstad’s 2014 Manufacturing and Logistics Workplace Trends Report, 59 percent of executives noted an industry-wide skills shortage, with more than half (52%) indicating that the lack of qualified employees has adversely impacted their business. When assessing talent, 44 percent of executives indicated that candidates lack relevant on-the-job experience, while 43 percent said candidates don’t have sufficient knowledge of the industry/sector. Twenty-two percent of executives said candidates lack the appropriate years of experience in the field.

Companies Taking a Closer Look at Recruitment Efforts
To address the skills deficit, manufacturing and logistics companies can place more emphasis on mentoring programs and internships, with a focus on attracting and training younger workers. In addition, an organization’s ability to retain skilled workers is crucial to offset the need to supplement the talent pool, and salary plays a big part of the retention equation. The Boston Consulting Group noted that there aren’t many cities across the country where manufacturing wages are rising, which continues to impact industry-wide retention efforts. In fact, according to Randstad’s Workplace Trends Report, a majority (61%) of manufacturing and logistics executives said that a top reason employees tend to leave is to accept a better job offer that has better pay or benefits.

With the current manufacturing talent pool insufficient for today’s needs, companies must make every effort to attract and retain the best talent to meet their organizational goals and help assure that the United States remains a global manufacturing leader.

Traci L. Fiatte, Group President, Randstad Staffing USA
Traci is responsible for the strategic direction and business operations for Randstad Staffing. This includes all company-owned branch offices, Randstad InHouse Services, and Randstad Corporate Services. Prior to her appointment to Group President in 2013, Traci was the Division President of Strategic and National Accounts; with her primary focus on accelerating the growth and profitability of Randstad’s largest customers. With over 18 years of industry experience, Traci is recognized for conceptualizing many key sales and operational innovations within Randstad and successfully leading teams to turn those innovations into successful businesses. This includes, but is not limited to, new recruiting delivery models based on client size and buying patterns, and using “big data” for analytics-based sales approaches. Traci sits on Randstad’s Global Advisory Board and holds an MBA from Northwestern University’s Kellogg School of Management.


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