February 19, 2014
Small business employees now make up a smaller piece of the employment pie, and this may say a lot about manufacturing's perennial skilled-labor crisis.
Small businesses drive this economy, and a large portion of metal fabricators fit proudly into this group. They’re the real engine behind innovation and prosperity, and when it comes to job creation, nothing comes close. Right?
Well, maybe not so much, at least when it comes to job creation.
According to the Bureau of Labor Statistics, and reported recently by Bloomberg, the share of U.S. workers employed by small businesses fell to a little more than 46 percent last year, and this includes businesses with fewer than 250 workers. When you narrow it down to fewer than 100, a category that the vast majority of metal fabricators fall into, the slice of the employment pie gets even smaller. So what kind of company in the U.S. now has the biggest slice? The corporate giants do—companies with 1,000 employees or more.The BLS reports also that the number of jobs created by startups less than a year old have fallen significantly over the past 20 years. In 1994 young companies accounted for 30 percent of the job growth in this country. By March of last year that number had fallen to just over 22 percent.
This isn’t really that surprising. Thanks to technology, a small business or startup doesn’t need much of a support staff anymore. And in fabrication, many businesses are straying away from labor-intensive work and instead toward automation. It’s better to work with a small group of skilled, extremely valuable employees to operate sophisticated machinery than to employ hundreds of unskilled or even semi-skilled assemblers and material handlers. The former makes for a more stable, healthier, and perhaps more enjoyable business climate, with fewer temporary workers coming and going with the ebbs and flows of customer demand.
These statistics also may throw some light on the perennial “skilled-labor crisis.” The more owners and managers I talk to, the more I believe this crisis really is one of engagement. But the fact that so many jobs in this country are now coming from large corporations says something about the kind of worker that’s proliferating in America.
Small businesses work with fluidity and flexibility. Whose job is it? At a small shop, if it needs to be done, and you’re qualified to do it, just do it. If it needs somebody who’s qualified or certified to a certain process, find them. If a business needs more people certified to get a job done, it needs to hire people or train from within.
Save for a few specialized jobs that require dexterity and experience—like welders certified to specific codes—most other tasks on the floor can be taught to an engaged employee. Cross training has become the norm. Skills can be taught, but not necessarily the willingness to learn.
Reviewing the statistics, though, “willingness to learn” may be the wrong term. So many jobs today come from large companies, many of which have a dramatically different work environment than the small, fluid, flexible, fast-paced small business. Perhaps it’s not about the will to learn. Perhaps it’s more about learning to adapt to change.
That said, those who do thrive in a small business benefit from change, from doing something different every day. That’s not a bad way to spend a career.