ATS survey underscores critical need for skilled workers at U.S. factories as baby boomers retire

Manufacturing executives estimate retiring workers will cost their companies an average of $43 million each year over the next five years and that training budgets aren’t sufficient.


As the first wave of U.S. Baby Boomers begin retiring this year, American manufacturing companies are highly concerned with their ability to find skilled workers, according to the results of a survey of industry senior executives commissioned by Advanced Technology Services, Inc. (ATS) and conducted by The Nielsen Company, a consulting and custom research firm. Among the survey’s key findings, the pending retirement of highly skilled Baby Boomer workers will cost manufacturing companies $43 million each, on average—with nearly one in five estimating their cost at over $100 million.

Many companies (58% of all respondents) are expecting to train and educate the next generation of skilled workers—defined as those qualified in machine calibration, electrical systems, machine operation, tool and die manufacturing and machine maintenance—themselves. However, funding is inadequate; half of those executives surveyed said their training budget was only 1 to 5%.

“Despite the perception that U.S. manufacturing jobs are scarce, the undeniable trend is that skilled workers will be in very short supply in coming years,” said ATS President Jeffrey Owens. “What’s more, while much of the political debate centers around healthcare and basic or higher education, what matters to most manufacturing employers is vocational training.”

The online survey, completed this month, found that two in three respondents agree that a robust training program is key to the future of U.S. manufacturing, and 90% feel high schools are not doing enough to prepare students for non-college careers. Executives stated that discrete (product-centric) manufacturing, electrical equipment manufacturing and motor vehicle parts manufacturing are the top areas most affected by the nascent labor shortage.

Other top findings from the survey:

  • Among CEOs taking part in the survey, the estimated per-company cost of the skilled labor shortage is even higher: $63 million, on average.
  • Most costs will be incurred in training and recruiting, followed by problems caused by lower quality and resulting decreases in customer satisfaction.
  • 20% of respondents currently have more than 15 job openings on their factory floor. Over twice as many (41%) anticipate having more than 15 such job openings within five years.
  • On the question of how important production machine maintenance is to achieving lean manufacturing, “very important” was checked by nearly 70% of those surveyed.
  • On a positive note, 77% of surveyed executives agreed that the technical skills of U.S. military veterans transfer well to today’s manufacturing needs.

The ATS survey included responses from 103 senior manufacturing executives with the title of Vice President, Plant Manager or CEO. Eighteen percent worked at manufacturing companies with revenues of $1 billion or higher; surveys were completed by individuals representing over two dozen manufacturing industry verticals.

Advanced Technology Services, Inc.

- Edited by Amanda McLeman, Plant Engineering,

No comments
The Top Plant program honors outstanding manufacturing facilities in North America. View the 2013 Top Plant.
The Product of the Year program recognizes products newly released in the manufacturing industries.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
A cool solution: Collaboration, chemistry leads to foundry coat product development; See the 2015 Product of the Year Finalists
Raising the standard: What's new with NFPA 70E; A global view of manufacturing; Maintenance data; Fit bearings properly
Sister act: Building on their father's legacy, a new generation moves Bales Metal Surface Solutions forward; Meet the 2015 Engineering Leaders Under 40
Cyber security cost-efficient for industrial control systems; Extracting full value from operational data; Managing cyber security risks
Drilling for Big Data: Managing the flow of information; Big data drilldown series: Challenge and opportunity; OT to IT: Creating a circle of improvement; Industry loses best workers, again
Pipeline vulnerabilities? Securing hydrocarbon transit; Predictive analytics hit the mainstream; Dirty pipelines decrease flow, production—pig your line; Ensuring pipeline physical and cyber security
Upgrading secondary control systems; Keeping enclosures conditioned; Diagnostics increase equipment uptime; Mechatronics simplifies machine design
Designing positive-energy buildings; Ensuring power quality; Complying with NFPA 110; Minimizing arc flash hazards
Building high availability into industrial computers; Of key metrics and myth busting; The truth about five common VFD myths

Annual Salary Survey

After almost a decade of uncertainty, the confidence of plant floor managers is soaring. Even with a number of challenges and while implementing new technologies, there is a renewed sense of optimism among plant managers about their business and their future.

The respondents to the 2014 Plant Engineering Salary Survey come from throughout the U.S. and serve a variety of industries, but they are uniform in their optimism about manufacturing. This year’s survey found 79% consider manufacturing a secure career. That’s up from 75% in 2013 and significantly higher than the 63% figure when Plant Engineering first started asking that question a decade ago.

Read more: 2014 Salary Survey: Confidence rises amid the challenges

Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Society for Maintenance and Reliability Professionals an organization devoted...
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.