How to reduce the impact of the manufacturing labour shortage
by Emily Newton, Editor-in-Chief, Revolutionized
A number of recommendations can help affected leaders make meaningful gains to solve the labour shortage within their organization.
The Canadian market is like many others worldwide in that it’s dealing with a manufacturing labour shortage. There’s no quick fix for this problem, but moving ahead with some targeted strategies could help.
Reward manufacturers for offering training
Many manufacturers say they want their workers to have richer skill sets, but they balk at actually providing the resources to help that happen. Thus, Canada’s Future Skills Centre invested $1.64 million into a Pay-for-Performance-in-Manufacturing program. It incentivizes companies to encourage their employees to undergo specific training initiatives addressing skills shortages.
Participating manufacturers get reimbursed up to 70% of the training costs per employee. However, that only happens if companies and workers meet three program objectives. The first is that the participant fulfills all requirements necessary for earning their certifications through training. They must also show improvement in one of four core competencies. Finally, employers must actively support their employees during the program’s span.
Manufacturers can also explore ways to ensure training leads to improved quality control. For example, avoiding right angles of 45-90 degrees is a best practice for avoiding electromagnetic interference (EMI) when designing circuit boards. Manufacturing leaders can begin by identifying weaknesses in their current quality control efforts. They can then assess how training might improve them.
Increase perks for employees
Information published by Statistics Canada in June 2022 showed that 47.4% of manufacturers expected recruiting skilled employees to be an obstacle over the next three months. The same source indicated manufacturers’ offered wages were slightly below the so-called reservation wage, or the minimum hourly amount people will accept before agreeing to take the position.
That suggests hiring managers can start tackling the manufacturing labour shortage by increasing their wages. David Macdonald, a senior economist at the Canadian Centre for Public Alternatives (CCPA), argues that one of the key reasons people aren’t taking jobs is that the opportunities aren’t attractive. Further, he says one of the top reasons is that the pay is too low. Additionally, candidates want good working conditions.
Manufacturers must assess how their pay and benefits stack up to peers in the industry. They should also investigate ways they can go above and beyond to make their workplaces appealing for the long term.
Consider broadening hiring practices
Some decision-makers have pursued automated technologies to help them manage the manufacturing labour shortage. That’s an option, but sometimes, making progress requires adopting different hiring methods.
That may mean eliminating some job prerequisites that may deter workers who are newer to the industry. It could also entail posting jobs on social media to reach new segments of the potential workforce.
Another initiative seeks to provide more labour-force opportunities to the approximately 1 million Canadians with disabilities who are seeking jobs but are unemployed or underemployed. The goal is to look beyond a person’s resume and remove the barriers that may prevent them from securing a position.
These are examples of how manufacturers could change their hiring practices to make them more inclusive and have a broader reach. A larger overall candidate pool often enables finding qualified applicants faster.