Death, taxes, and the skilled labor shortage

WWW.THEFABRICATOR.COM OCTOBER 2002

October 24, 2002

By:

It's an issue that refuses to go away—the difficulty in finding, hiring, and keeping skilled labor. Four out of five employers who responded to thefabricator.com's recent job skills survey reported that they have been searching for skilled workers from three to 20 years. They are looking for high school graduates or GED recipients with five-years on-the-job experience.

Job Seeker experience level pie chart

Figure 1Object

Thirty-two percent of the skilled workers who responded to this survey currently are unemployed and have been job hunting from two weeks to a year. Ninety-one percent of the respondents reported experience levels ranging from five to more than 30 years (Figure 1).

Twenty-nine percent have a high school diploma or GED. Thirty-nine percent have completed junior college or trade school. Twenty-seven percent have a university or four-year college degree, and five percent have a master's degree (Figure 2).

The survey included a list of 23 metal forming and fabricating processes, including tube and pipe producing and fabricating, stamping, welding, various cutting methods, sawing, punching, press brake bending, leveling, tooling, and more. Survey takers were asked to check all areas in which they have experience. Experience was recorded in all areas.

The survey results indicate that there are skilled workers looking for jobs, so why are employers having such a hard time attracting and keeping quality workers?

What skilled workers want

An employed survey respondent with more than 20-years experience in stainless steel fabrication and TIG welding included the following comment: "I am currently employed with [Company Name]... I am currently looking for better employment. I would like to... take my talents where they will be somewhat appreciated."

Skilled workers want respect. They want to be thought of as something other than a commodity—more than simply a part of the standard formula for manufacturing success:

Machines + Raw Materials + Labor = Success

In their article entitled "Closing the Labor Shortage Gap," which appeared in Corporate Reports Wisconsin, September 1997, James B. and Mary Lee Rieley stated, "this formula is based on the mental model that labor is a 'thing' that can be acquired or fixed when it does not function well. This is true with machines and facilities, but not labor. Labor is not a 'thing' but a group of people who come together to provide assistance to an organization to accomplish organizational goals.

"It is also based on the belief that capital assets are keys to financial success in businesses. In most organizations, when economic pressures begin to become unbearable, the step most often taken by business is to 'get rid of some labor.' Labor is seen as an expense, not an asset."

Is history repeating itself?

During the recession of the early 1980s, many skilled welders, electricians, machinists, and tool-and-diemakers lost their jobs. Apprenticeship programs became another casualty, breaking the longstanding link between generations of workers following the family career path. According to David Kusnet, author of "Did Lack of Respect Lead to a Growing Labor Shortage?" first published in the Los Angeles Times on May 2, 1999, "even today, the memory of what happened to fathers, uncles, and older brothers discourages younger folks from following them."

job seeker education level pie

Figure 2Object

It's happening again. Companies are downsizing, laying off employees, and cutting training programs, reimbursements for educational development, and other benefits.

In an article published on thefabricator.com February 12, 2001, "Feeling the Effects of a Welder Shortage," author Kevin Kelleghan quoted Maureen Mason, human resources director at Olympic Steel, as saying, "With turnaround expected by the end of the first quarter of 2001, fabricators will be back in the market for qualified employees. We would hire as business grows," Mason said. "Some additional positions are possible as we see growth in the first half." Kelleghan went on to say, "But she didn't say where she would find the people to fill those positions."

More than a year and a half since that article was published, things have gotten worse instead of better. Cuts continue and the industry is in danger of facing an even more severe skilled labor shortage when conditions approve and serious labor needs arise.

In his 1999 article, Kusnet stated, "In the auto industry, skilled workers are mostly more than 50 years old. They're nearing retirement in an industry where workers qualify for pensions after 30 years on the job. And relatively few young people are taking their places.

"As for skilled machinists, their average age is also over 50, and many are approaching retirement as well. And only 15,000 young people become machinists each year, leaving 30,000 jobs unfilled."

That was three years ago.

The consequences

According to Rieley and Rieley, "As the available labor pool goes down, the ability to hire goes down, reducing the organizational capacity, success, growth, expansion, and thus, the hiring of additional skilled workers." Employers need consistent skilled labor in order to realize their organizational goals and grow their businesses. In truth, employers need skilled workers more than the workers need the jobs. Unless workers are made to feel valued, they will look elsewhere, either at companies that will give them that sense of value, or they will make career changes and leave the industry.

What must happen

According to Rieley and Rieley, "Solutions to the problem of how to close the gap between the level of skilled labor availability and the needs of manufacturers today can be found by exploring a shared understanding of not only the needs of the manufacturers, but the needs of the potential labor pool."

Employers must understand and address the needs of current and potential employees, which include the ever-increasing numbers of women in the workforce. Areas of concern to these workers include adequate monetary compensation and healthcare benefits, the availability of affordable housing and transportation, childcare, and opportunities to learn new skills and grow on the job.

As Kusnet stated, "We'd better ask ourselves how these occupations must appear to young people choosing their life's work. Can we claim that if they prepare for these careers, they can look forward to secure jobs with rising wages and at least a little respect from their families, friends, neighbors [and coworkers]? ...[can we] promise the skilled workers the rewards they deserve?"

If we can, maybe workers like the currently employed survey respondent with 20-years experience won't have to look for other jobs that make them feel more appreciated.



FMA Communications Inc.

Vicki Bell

Web Content Manager
FMA Communications Inc.
833 Featherstone Road
Rockford, IL 61107
Phone: 815-227-8209

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