INDUSTRY SNAPSHOTS. Manufacturing

Transcription

1 INDUSTRY SNAPSHOTS Manufacturing 1

2 Building HR Solutions for the Manufacturing Industry With 54 percent of manufacturers reporting that they are unable to find candidates with the right skills, companies must use benefits to recruit and retain skilled workers. 1 One place to start - nearly half (46 percent) of manufacturing industry employees say improving their benefits package is one thing their employer could do to keep them in their jobs. 2 Voluntary benefits can be used to bridge the educational gap and allow manufacturers to create a more qualified workforce. 2

3 Industry Challenges Volatile financial markets, reduced commodity prices and lackluster growth continue to challenge manufacturers. The relatively stable U.S. market is attracting more foreign capital and competition. To better compete with global competition, U.S. companies must integrate technology and data analytics into all facets of their business. 3 A few key issues affecting the manufacturing industry are highlighted below 4 : 1. Technology If capitalized and managed correctly, the advent of smarter products and Internet of Things can allow firms to more actively monitor and optimize plant, asset, and supply chain performance. These advanced technologies are creating a demand for employees who understand traditional hardware, as well as those that understand software and programming. 3. Supply chain management Supply chain management will continue to be a key challenge for industrial products organizations. Consolidation among industrial products firms is predicted. 2. Uncertainty in the energy segment The disruption in oil and gas and energy has created big questions for Industrial firms about how and where to play in oil and gas and within the broader energy grid. 3

4 HR Challenges According to a research report by the Society for Human Resource Management, HR professionals in the manufacturing industry are reporting some of the highest levels of recruiting difficulty. Reasons include lack of needed work experience among candidates, competition from other employers and candidates lack of technical skills. 5 A few other HR challenges in this industry include: 1. The cost of turnover Replacing one employee costs, on average, over $10, Per 1,000 employees, the average manufacturer loses more than $1 million per year due to turnover. 7 $10,000 average cost to replace one employee 4 $1 million (per 1,000 employees 5 ) 2. Employee work/life balance The average workweek in this sector is now 42 hours, the highest since World War II. 8 This signals a positive upswing in the industry, but employee stress and fatigue can contribute to workplace accidents. 3. Employee productivity With 37 percent of all employees saying they are distracted by financial stress while at work, 9 the average manufacturer is losing more than $850,000 every year per 1,000 employees. 10 of employees are distracted by financial stress while at work 7 % 6 (per 1,000 employees 7 ) 37 % $850,000 4

5 Trends Trends to watch in the manufacturing industry include: Innovation and technology U.S.-based manufacturers and distributors are lagging behind their non-u.s. competitors in their use of information technology. Overall, U.S. companies need to look more at harnessing technology resources to drive innovation or transformational change. Manufacturers should also be focusing on ensuring their IT security strategies remain effective for customer security and protection of intellectual property. 2. Mergers and acquisitions Companies are looking with renewed interest at merger and acquisition opportunities as part of their growth strategies. Deal prices are drifting higher and this will mean that buyers need to plan transactions carefully, from the identification of compatible candidates through due diligence to final integration. For those looking to sell, it will be important to demonstrate consistent profitability to position their companies for such transactions. 3. Enhanced benefits packages In the current marketplace, employees have more flexibility to seek out employment opportunities that better fit their needs and wants rather than remain in a position for its job security. In fact, 45 percent of employees say that they would be likely or very likely to look for other jobs outside their current organization within the next year. 12 Employers may look at enhancing benefits packages with flexible work hours, expanded benefits, more vacation or medical leave options. As voluntary benefits have become more mainstream, they play an important role in enhancing benefits packages to satisfy employees needs. Employers are increasingly embracing non-traditional voluntary benefits as a method of providing enhanced benefits packages. Purchasing Power s employee purchase program is one of the non-traditional voluntary benefits that supports key HR objectives by providing a no-cost, no-liability benefit that gives employees a manageable, convenient way to access products and services that are often out of reach. 5

6 Citations 1 US Bureau of Labor Services Job Openings and Labor Turnover Survey Aflac WorkForces Report. 3 RSMUS.com, 8 Trends in Manufacturing to Watch in 2016, Steve Menaker and Joe Brusuelas. 4 Deloitte.com 2016 Industrial Projects Outlook. 5 SHRM New Talent Landscape Report. 6 CBSNews. com, How Much Does It Cost Companies to Lose Employees, Suzanne Lucas, Nov US Bureau of Labor Services Job Openings and Labor Turnover Survey, 8 Business Insider, US Manufacturing Workweek Hasn t Been This Long Since WWII, Rob Wile, Dec Harris Poll conducted on behalf of Purchasing Power, US Bureau of Labor Statistics Employer Costs for Employee Compensation, 11 RSMUS.com, 8 Trends in Manufacturing to Watch in 2016, Steve Menaker and Joe Brusuelas. 12 Society for Human Resource Management (SHRM), Employee Job Satisfaction and Engagement: Revitalizing a Changing Workforce, April About Purchasing Power We help employees who are underserved by traditional financing options access life-enhancing products and services. Employees can purchase the items they need and affordably spread payments across 12 months to give them peace of mind and control over their finances. Our pricing is transparent with no hidden fees, no interest, no credit checks. Why We Do It To improve employee financial well-being To empower people to take control of their lives To help organizations recruit and retain employees Visit us at PurchasingPower.com/Employers. Purchasing Power is a registered trademark of Purchasing Power, LLC. Other trademarks or registered trademarks used are the property of their respective owners. Pub. Date Purchasing Power, LLC. All rights reserved * Definitive 2016 customer survey responses 6