Reports from two of the biggest consulting firms in the world, Boston Consulting Group and Accenture, looked at what is euphemistically being called on-shoring. What their research shows is manufacturers are discovering China is not as cheap as everyone thought. When you factor in everything from the shipping of goods to the availability of workers to the inflexibility of the supply chain and the manufacturing specifics, the cost of producing goods in the U.S. is actually very competitive with the Chinese cost.
However, human capital is one of the critical issues facing U.S. manufacturing. Between the coming renaissance in manufacturing and the impending baby-boomer retirement, manufacturers are going to have to fill millions of positions in the next decade.
In fact, we are already seeing the beginning of the problem today. In a nationwide survey by The Manufacturing Institute and Deloitte, 32 percent of manufacturers reported moderate to severe skills shortages—and this was in the summer of 2009, at the height of the recession and job losses.
The time is right for manufacturers to change the way they approach and manage their human capital. The Manufacturing Institute is rolling out the flagship education initiative of the manufacturing industry as the national solution to the talent challenge.
To develop the manufacturing talent solution, called the NAM-Endorsed Manufacturing Skills Certification System, The Manufacturing Institute joined with several other leading industry groups to create a system of nationally portable, industry-recognized credentials. These credentials and the training required to obtain them certify an individual possesses the basic skills required to work in any sector of the manufacturing industry.
The manufacturing system can be envisioned as a pyramid of skills certifications, with an initial focus on the skills required for all entry-level jobs in manufacturing today:
- Personal effectiveness skills
- Foundational academic competencies—for manufacturers, those are applied math, reading, locating, and using information
- General workplace competencies, which cover the fundamentals of business
- Industry-wide technical skills related to basic manufacturing processes, including production, logistics, machining, quality assurance, safety and health, and technology.
The foundational competencies in the first tiers are grounded in ACT's National Career Readiness Certificate. The workplace and technical competencies are covered by the Manufacturing Skill Standards Council's Certified Production Technician, the National Institute for Metalworking Skills Machining and Metalforming certifications, and the American Welding Society's Certified Welder series. Finally, the Society of Manufacturing Engineers Engineering Technologist certification caps the entry-level skills system, recognizing the infusion of technology into all manufacturing processes.
The Institute also is developing higher-level pathways for sector-specific skills and competencies, including automation. We have recently announced a partnership with ISA to bring automation and control systems certifications into the Manufacturing Skills Certification System, adding ISA's Certified Control Systems Technician (CCST) and Certified Automation Professional (CAP) certification programs to the system's offerings.
The Skills Certification System is currently being implemented in community colleges' for-credit programs of study with connections down to high schools and technical schools and up into universities. The specific learning content needed to obtain the skills required to achieve each certification has been mapped to educational pathways. And these educational pathways are aligned to career pathways in quality jobs in manufacturing.
This system is not just a training program for manufacturers. It is the framework for building a workforce proficient in applied science, technology, engineering, and math (STEM) because as our economy continues to advance, more and more industries are going to require a STEM-capable workforce.
As we make significant progress aligning education with the needs of industry, we need industry to reflect this paradigm shift in their hiring practices. Manufacturers can accelerate these efforts, becoming strong advocates for building credentialed talent.
About the Author
Emily Stover DeRocco is former president of The Manufacturing Institute. This article was adapted from a speech given at the Lehigh Valley Manufacturing Summit in Allentown, Pa.
A version of this article also was published at InTech magazine.