2018 Salary Survey: Skilled worker shortage, challenges
The 2018 Plant Engineering Salary Survey examines what is happening in the manufacturing world from a variety of perspectives. Click on the links below to see more information in the digital edition.
Plant leaders don’t typically work a 40-hour week—56% put in more than 45 hours a week at their job. They also are well-educated in the formal sense, as 77% have a college degree—evenly split between electrical engineering and mechanical engineering. They add to that education with their on-the-job experience, with 69% having more than 20 years in manufacturing and engineering. There continues to be some job movement, as more than one-quarter (26%) have been with their current employer less than five years.
They also supervise smaller staffs today. While 69% of plant leaders are in facilities of more than 100 employees, 47% have fewer than 20 employees working for them.
The issue of an aging workforce, and the related problem of manufacturing’s skills gap, is reflected in this year’s survey respondents. There are three times as many plant leaders over age 60 as there are under age 40. This leadership gap cannot be filled by automation: robots cannot lead, provide discipline, or listen to and act upon the workers’ concerns. Finding more workers, as we see again in this year’s survey results, is the singular issue facing the industry. Finding leaders from among the current workforce is a less visible issue, but it will become a greater concern as the older workers move closer to retirement.
After slumping in 2017,
Workers expect more of the same in 2019, as most expect pay raises to increase by 1% to 3% in the coming years. Bonus compensation, which climbed back above the $10,000 average in 2018, is expected to stay largely the same, as two-thirds of respondents do not expect an increase. The basic criteria for those bonus increases remain unchanged, led by company profitability and personal performance.
Every region of the country saw a salary increase in 2018, led by the Southwest, which includes the oil & gas industry. That region saw a 6.5% increase in salaries, and the oil & gas sector saw a similar increase, although bonuses in that sector were lower.
Confidence in a manufacturing career is at its highest level of the decade, with 79% of respondents considering manufacturing a secure profession. The confidence in the longer-term future of manufacturing is harder to gauge, however.
It should come as no surprise that plant leaders identify the skilled workforce as the biggest threat to manufacturing; it’s been the top concern for 12 of the 14 years that Plant Engineering has asked the question. What is worth nothing this year is that the skills gap issue is a bigger concern than the next three issues combined.
What also is a change from past years is how other issues are perceived. On the one hand, 23% of respondents cited the economy as the top concern in 2015 and 2016. In 2018, that level had dropped to 7%, indicating increased confidence in the overall U.S. economy. However, tariffs were not mentioned in 2016; in 2018, 6% of respondents named tariffs as the top concern.
The skill set for the next generation worker continues to be engineering and project management, with communication and team-building skills, and automation knowledge also high on the list.
Despite a dearth of new workers and the aging of the current workforce, manufacturers remain reluctant to add technology to solve the problem. The Industrial Internet of Things (IIoT) is still a technology-in-progress, as 30% have no plans to implement it at all versus 17% of respondents who already have implemented IIoT or have it budgeted for 2019. All plants have some form of robotics in their facilities, but 75% of plants use it in only 10% of their operations, and 46% have no plans to add robotics in 2019. All respondents see value to robotics in their operation, mostly in key metrics—productivity (59%), safety and ergonomics (54%), and cost savings (41%). That value doesn’t extend to workforce development, however; just 13% see robotics as a solution to close the skills gap.
Data management within the plant is a new and significant issue for plant leaders. Cybersecurity is seen as a serious plant threat in 60% of facilities, and 30% of respondents admitted that their personal data had been hacked at some point. But just 15% see the problem as a joint effort between plant floor and IT personnel, while 77% see the cybersecurity issue as strictly the responsibility of the IT department.