State of Manufacturing Jobs in the US
Manufacturers are continuously striving to overcome challenges, improve processes, and identify efficiencies. The industry is largely driven by technological advances, marketplace needs, and the objectives of the business.
After the COVID-19 pandemic, manufacturing industry output fell at a 43% annual rate and hours worked fell at a 38% rate in the second quarter of 2020, according to the US Bureau of Labor Statistics. Notably, 2020 saw the largest decline since World War II.
Motor vehicle production ceased. This industry was the driving force in the immediate recovery, as manufacturing output recovered within 5% of pre-pandemic levels. Motor vehicle and parts production declined over the next three quarters—due in part to supply-chain disruptions.
Primary metals, fabricated metal products, machinery, food, beverage, tobacco products, and chemicals were also hit hard.
Manufacturing output escalated in the third quarter of 2020, the agency wrote. The annualized gains in manufacturing output (53%) and hours worked (30%) in the third quarter of 2020 were the largest ever recorded.
Additionally, output recovered faster than hours worked, which resulted in a historically high increase in manufacturing productivity of 18%.
As the US manufacturing industry gained momentum in 2021 after the vaccine rollout and rising demand, experts saw positive economic indicators in 2022.
Manufacturing output has continued to grow steadily through the second quarter of 2022 and was 3.5% above the level in the fourth quarter of 2019. Hours worked in manufacturing increased in all but two quarters since the third quarter of 2020 and have recovered to within 1.2% of the level in the fourth quarter of 2019.
Additionally, labor productivity in manufacturing was 4.7% higher in the second quarter of 2022 than in the fourth quarter of 2019.
Manufacturing Trends for 2022
With the ongoing growth of technology, connectivity, and automation enhancements, technical maintenance company ATS compiled a list of the top eight manufacturing trends for 2022.
The 2022 trends are as follows:
1. The Year of Smart Factories
As older equipment continues to phase out, newer machines come equipped with onboard sensors.
Therefore, factories and manufacturing facilities passed the tipping point of smart factory adoption in 2022, moving from the occasional implementation of smart equipment to full-fledged systems.
2. Increased Focus on Sustainability and Carbon Neutrality
As environmental, social, and governance (ESG) issues become more of a concern for manufacturers, sustainable processes and the pursuit of carbon-neutral practices become more prominent. Manufacturers see more ESG requirements from commercial customers.
3. Supply Chain Reassessment
The supply chain continues to hold a prominent position as an area of continuous monitoring, management, and improvement. Facilities are seeking new ways to add flexibility and reliability while retaining value.
4. The Ongoing Importance of Reshoring
Reshoring was presented as a lofty goal prior to the COVID-19 pandemic. But this year, reshoring settled in as a more attainable and necessary supply chain solution, becoming a conventional way of operating.
5. Employee Safety and Health
COVID-19 also changed the way that employee safety is monitored and maintained. Precautionary tools continued throughout this year, with some facilities employing more advanced equipment, movement, and temperatures.
6. Data-Driven Maintenance as a Margin Enhancer
Sensors, remote monitoring, connected devices, and the Internet of Things (IoT) continued in 2022 as these assets became more commonplace.
7. Increased Reliance on Virtual Processes
Technologies including machine learning, artificial intelligence (AI), AR, and VR help manufacturers navigate COVID-19 challenges by enabling remote monitoring, servicing, and equipment operation without the need to be on-site.
8. Meeting Increased Demand With a Decreased Labor Force
Facilities look to address the skills gap and labor shortages that have continued throughout the past few years. In 2022, many facilities identified ways to increase efficiency and support the workforce, while bridging the skills gap and providing cutting-edge technical training to meet today’s needs.
The Trajectory of US Manufacturing
Last year, Deloitte estimated a shortfall of 2.1 million skilled jobs by 2030. But manufacturers should pair strategies, including reskilling, with a recasting of their employment brand to attract and retain talent.
Reducing the industry’s public perception gap by making manufacturing jobs more desirable could be critical to meeting hiring needs in the future. And engaging with a wider ecosystem of partners can help offset the recent wave of retirements and voluntary exits by reaching more diverse, skilled talent pools.
During the COVID-19 pandemic, workers resorted to zoom meetings and makeshift office spaces at home. Therefore, manufacturing executives also need to balance goals for retention, culture, and innovation by adding flexibility across their organization to attract and retain workers.
Additionally, the shortage of qualified professional truck drivers continues to rise year over year because drivers are searching for jobs that offer better pay, benefits, and working conditions.
Last year, the American Trucking Association (ATA) reported a shortage of 80,000 drivers, an all-time high that could reach 160,000 by 2030. The COVID-19 pandemic only made the driver shortage worse, as training and apprenticeship programs were either closed or limited their operations.
Experts believe that driver shortages in trucking and congestion at US container ports are likely to continue. As demand outpaces supply, higher costs are more likely to be passed on to customers.
Digital supply networks and data analytics can be beneficial enablers for more flexible, multi-tiered responses to disruptions. Manufacturers looking to capture growth and protect long-term profitability should embrace digital capabilities and networks from corporate functions to the factory floor.
