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Skilled labor remains lead issue facing automotive tooling manufacturing, says survey
- October 13, 2017
- News Release
- Shop Management
The Original Equipment Suppliers Association (OESA) and Harbour Results Inc. (HRI) have released the results of their Q3 2017 Automotive Tooling Barometer. The survey results show that the tooling industry experienced a strong third quarter, with die shops experiencing a spike in capacity utilization (88 percent) and mold shops reaching 81 percent capacity. Shops with revenues of $10 million to $20 million are experiencing peak capacity utilization rates of 87 percent.
“Even though mold shops are slightly less utilized than die shops, average profitability numbers across the industry are still very close,” said Laurie Harbour, president and CEO of HRI. “That being said, the top-performing tool shops average 8 points more profit compared to the averages.”
The cyclical nature of work-on-hold continues, as it falls to 8.6 percent, the lowest it has been since this study started in 2014. Despite record-low work-on-hold numbers, overall sentiment (a tool shop’s general outlook for the next three months) dropped 2 percentage points, but still remains in the overwhelmingly positive range.
The slight decrease in sentiment is likely due to the continued hurdles the tooling industry is facing. Overall, skilled labor (38 percent) stands out as the foremost issue in the industry, followed by on-time delivery (18 percent) and profitability (14 percent). These key issues vary considerably depending on factors such as a shop’s profitability, type, and geography.
“The shortage of skilled labor is a major concern for both U.S. and Canadian shops in multiple processes—mold, die, and plastic molding,” said Julie A. Fream, president and CEO, OESA. “In order to combat this issue, it’s necessary that these companies implement a talent acquisition program to educate, attract, and hire young people with the aptitude to work in the tool and die industry.”
The survey population comprised mold shops (77 percent) and die shops (23 percent), both in the U.S. (70 percent) and Canada (30 percent). Shops with revenue up to $40 million were represented, with the largest percentage of shops (30 percent) coming from the $10 million to $20 million range.
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