Skills Gap Dramatically Slows Business Growth

All right, we know there is a great disconnect with high unemployment while thousands of skilled jobs go unfilled due to a lack of qualified applicants. But just how bad is it?

A new report from Deloitte and the Manufacturing Institute answers that with a "pretty bad." Here’s a short analysis from the State Science & Technology Institute and a link to the 16-page report.

American manufacturing companies cannot fill as many as 600,000 skilled positions — even as unemployment numbers hover at historic levels — according to Boiling Point? The Skills Gap in U.S. Manufacturing, a new report from Deloitte and the Manufacturing Institute. This annual skills report provides a stark snapshot of the manufacturing sector’s inability to find qualified workers. Approximately 67% of survey respondents attribute the unfilled positions to a shortage of available, qualified workers. Unfilled jobs are mainly in the skilled production category positions (e.g., machinists, operators, craft workers, distributors and technicians).

The report also indicates that this shortage has an impact on the overall competitiveness of the U.S. manufacturing sector. Approximately 64% of respondents report that workforce shortages or skills deficiencies in production roles are having a significant impact on their ability to expand operations or improve productivity.

To resolve these issues long-term, the U.S. must focus on the next generation by developing a skilled workforce that goes beyond the required skills (i.e., a solid math and science base). Respondents indicated that high schools should focus on strengthening students’ critical thinking and problem solving skills.

Anytime we talk about this topic, I have to mention Ready Indiana, the Indiana Chamber’s workforce initiative, and its role in helping connect companies and employees with needed training resources.

Competing in the Manufacturing World

I see this phrase or a version of it often and use it myself occasionally: "In Indiana, we make things."

With that being the case, we (Indiana and the U.S.) need to be the best in the manufacturing business. According to a recent report from the Council on Competitiveness and Deloitte, it takes innovation and advanced skills development on one side of the equation complemented by research, technology and full commercialization.

The 16-page report is Ignite 2.0: Voices of American University Presidents and National Lab Directors on Manufacturing Competiveness. Five goals are outlined for colleges, universities and the national labs:

  • Continue to support the community colleges and universities though long-term government programs

  • Utilize community college more effectively to develop a skilled S&T workforce

  • Create conduits that connect talent and ideas at universities with the private sector and the local community in regional clusters

  • Implement university programs in math, science and manufacturing

  • Ensure that national laboratories develop mission-driven innovations and broaden the definition of national interests to include impactful economic development

The report also provides several recommendations to build a 21st century advanced manufacturing workforce and to fuel science, technology and innovation. In the coming months, the council is expected to release Ignite 3.0, which will highlight the perspectives of U.S. labor leaders.