As society tends to push young adults to pursue a four-year college degree, it creates a vacuum for filling vacancies in the skilled trades.
Due to skills gaps, there is an expected shortage of 2.1 million unfilled manufacturing jobs in the United States by 2030. Therefore, manufacturers are actively trying to attract Gen-Z workers to fill these roles, but they are currently facing labor challenges, as manufacturers are filling only six out of 10 job openings, according to an analysis by global management consulting firm McKinsey & Company.
In a phone conversation with Julian Salguero, a partner at McKinsey, he sheds light on how Gen-Zers could be enticed to enter the manufacturing industry. Salguero advises and serves consumer packaged-goods clients, with a focus on North America and Latin America. His areas of expertise include operations strategy, supply chain management, digital and lean manufacturing and change management.
“Since January 2020, the manufacturing sector has experienced a 43% gap between the number of jobs and hires,” Salguero stated. “For Gen-Z, rising pay and new technologies, coupled with the soaring cost of higher education, enhances the appeal of a career in manufacturing. This presents a huge opportunity for operations leaders to rebrand these jobs to attract this young talent pool.”
About 55% of Gen–Z feel pressure to gain professional experience in high school, and 61% want to know their career path before going to college, Gen-Z researchers revealed to the Society of Human Resource Management. This presents a unique opportunity for manufacturers to engage this generation early through apprenticeships and vocational training.
Gen-Z In The Trades
Gen-Z has been deemed the “Toolbelt Generation” for its open-mindedness in embracing the trades over the traditional college pipeline. A skilled trade is a job that requires specific skills, knowledge or abilities. These occupations are generally hands-on, roll-up-your-sleeves jobs.
Data from the National Student Clearinghouse Research Center shows the number of students enrolled in vocational-focused community colleges increased 16% from 2022 to 2023. Fields like construction, vehicle maintenance, HVAC repair and installation are seeing major upticks in young people pursuing these careers.
Training or an apprenticeship in the trades can be a more cost-effective way to obtain a job compared to pursuing a bachelor’s degree. With the continual rise in costs of a four-year college education and a growing cynical skepticism about their return on investment, young people are starting to look at other options. They don’t want to be saddled with tens of thousands of dollars or more in student loans and the inability to find a job that pays enough to cover the debt.
Since there is an ever-growing demand for skilled tradespeople, these jobs can offer a faster path to competitive salaries and financial stability. However, employers in the trades, specifically manufacturing, must carefully consider how to effectively recruit and retain Gen-Z talent.
Although more Gen-Zers are open to the idea of working in manufacturing, since 2019, Gen-Z’s share of the manufacturing workforce has declined to 7%, according to McKinsey. In the past, manufacturers have responded to past talent shortages with wage increases. Since January 2020, manufacturing wages have risen by a cumulative 21.5%; however, they are still unable to meet labor demands.
Additionally, 48% of Gen-Z workers who do join the manufacturing industry report they intend to leave within the next three to six months, which is costly for employers. McKinsey estimates that each frontline employee departure could cost about $52,000 annually in recruiting, training, and onboarding productivity losses.
Appealing To Gen-Z
To appeal to Gen-Z’s tech-savviness, manufacturers should showcase the industry’s adoption of robotics, artificial intelligence and other advanced technologies, as it is an innovative, high-tech field with opportunities beyond traditional factory roles, including coding, engineering and digital skills.
According to Salguero, young people tend to want jobs that offer career advancement, work-life balance and purpose. “Our research indicates that Gen-Z workers’ motivations for taking, keeping or leaving skilled trades jobs are similar to those of older cohorts, although compensation is less of a draw compared to other factors, including career development, flexibility and meaningful work,” he stated.
Manufacturers can attract this cohort by offering options like shift swapping, part-time roles, hybrid and remote work (where applicable) and flexible schedules that allow for better work-life balance.
Gen-Z is deeply concerned about the purpose in their work. Highlighting sustainability efforts, such as adopting additive manufacturing or 3D printing to reduce waste, using eco-friendly materials and implementing energy-efficient processes, can resonate with Gen Z’s values.
Mckinsey found that the top reason Gen-Z workers leave the manufacturing industry is due to the lack of career development and advancement.
Salguero said, “Investing in career development is proven to work, giving employees the opportunity to learn new skills and grow within the company.”
Additional Challenges
One major catalyst for the labor shortage in this sector is the perception that in order to be successful in America, you must pursue a four-year college degree. This has led to a de-emphasis on vocational trade education and a lack of respect for blue-collar jobs.
A survey by Thumbtack, an online technology services marketplace that connects consumers with local professionals for various home improvement services, reveals that 59% of skilled tradespeople felt influenced to attend a four-year college, due to family or societal pressure, while 89% of the survey respondents believe that kids are wrongfully taught that receiving a bachelor’s or master’s degree is the only path to success.
Source: Forbes
