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A Circular Problem: Labor Shortages and Expanded Manufacturing Automation

The continued issue of labor shortages in the manufacturing sector can also create problems for companies that want to expand automation in their operations. Can OEMs help?

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Labor shortage in manufacturing is not a new problem, and both large and small operations have been challenged over the years to find and retain both skilled and unskilled labor.

For manufacturers who want to expand automation in their operations, that process can be hindered by the lack of skilled labor, in particular. And paradoxically, while expanded automation often reduces the number of employees needed at a facility, it may also increase the required skill level of certain employees, which then may create new labor needs.

The COVID-19 pandemic has brought the labor shortage into sharper focus, because while many industries in the manufacturing sector were deemed “essential” and continued to produce, many employees have been hesitant to continue working, creating an even more difficult situation for employers who need to hire new employees.


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According to a new report by PMMI Business Intelligence and sourced from government data and ThomasNet, the cumulative unemployment rate in the U.S. fell from 14.7% in April to 13.3% in May, and despite 30% of manufacturers stating they are currently seeking new hires during the COVID-19 pandemic, the overall employment rate in manufacturing has contracted sharply, declining 19.1% from January to April.

The report also states that according to Deloitte, the manufacturing sector in the U.S. will need to fill as many as 4.6 million jobs over the course of the coming decade. But it is predicted that only 2.1 million of those openings will be filled by properly skilled employees, leaving a labor shortfall of 2.5 million positions.

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