En Masse Retirements Challenge US Manufacturers
Source Newsroom: Ithaca College
Newswise — As millions of boomers prepare to retire, US manufacturing companies, hit harder than other sectors by the recession, now face huge costs for training new employees in the forthcoming years, according to a report by the Sloan Center on Aging at Boston College.
"In many ways, the aging of the workforce will be like a tide, drawing the talents of older workers out of the labor force,” said Ithaca College sociologist Stephen Sweet, coauthor of the report “Responsive Action Steps for the Manufacturing Sector.”
In comparison to other sectors, the manufacturing sector has a disproportionate number of older workers and men are significantly over represented. Only one in three employees is a woman.
“The limited successes in attracting or retaining female workers may be symptomatic of organizational practices that will also likely fail to respond to the diverse needs and expectations of workers in the future,” said Sweet.
The median cost of replacing employees in the manufacturing sector is $5,000 per employee, compared to $3,000 per employee in other sectors. Beyond the cost, manufacturers face the challenge of transferring knowledge to the next generation of employees.
Compensation in the manufacturing industry has stagnated over the past decade. The report suggests that in order to attract and keep workers (particularly females), providing substantial compensation may not be enough to retain key talent who look for flexibility to accommodate family responsibilities.
Manufacturing has traditionally, and by necessity, called for rigid work schedules. However, the research suggests there may be room for innovation.
“One strategic means of addressing future talent shortfalls is to identify and introduce flexible work arrangements, such as flexible work schedules, career breaks or job sharing,” Sweet said. “These will enable employers to hold on to the workers they have while attracting the workers they need.”
Other findings show that manufacturers are less likely than other organizations to engage in retirement and succession planning and employers report manufacturers have too few programs for recruitment and employee development.
Top skills in short supply include: management, legal, sales/marketing, operations and technical/computer.
An associate professor of sociology at Ithaca College, Stephen Sweet studies the intersections between work, family and community. His most recent book, “Changing Contours of Work: Jobs and Opportunities in the New Economy,” examines how economic transformations are reshaping work opportunities in the United States.
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Sweet serves as a visiting scholar at the Sloan Foundation and he is coprimary investigator in the series of reports on “Talent Pressure and the Aging Workforce.”