Will the “Great Resignation” Become an Opportunity for Manufacturers? Get Ready for the Returning 3 Million

Something akin to the “Great Resignation” already happened once before. It happened to manufacturers about a generation ago.

Today, employers throughout the economy are coming up short after a large segment of the populace left the workforce during the pandemic. But a little over two decades ago, manufacturing employers began openly noting something similar: missing employees and prospects, owing to the fact that the pipeline for talent was no longer producing skilled manufacturing employees in the numbers once available. The various reasons for this included fewer young people seeking trade education, trade school opportunities declining as a result, and technology advances leading to a mismatch between manufacturers’ needs and skills being taught.

Some of those circumstances have improved. Still, this deficit was no passing slump. I have on my desk a copy of Modern Machine Shop from 20 years ago in which we were talking about the skills gap and the difficulty of finding skilled machinists in ways that still feel current today.

But during those 20 years, manufacturers accommodated. They learned to do more with a smaller number of skilled and knowledgeable employees. The means of adapting included automating or systemizing simple tasks, as well as a less-appreciated but just as important change many manufacturers made: the shift to a culture oriented around people who “get it” — a mode of staffing in which employees with aptitude and a fit for the workplace’s values are sought in place of skilled tradespeople, because these personal and cultural fits can be trained quickly in a large share of the skills the workplace needs.

Now, it seems our entire economy is confronting the same deficit. We see in every short-staffed store and restaurant how the number of employees has declined. A recent report from the U.S. Chamber of Commerce quantifies the size of this shortage: 3.4 million. That figure is how many fewer employees are participating in the U.S. labor force now versus just before the nationwide response to COVID-19 began.

But here is a crucial difference: Today’s missing 3.4 million will not stay away. What’s more, there is a future manufacturing workforce to be found here. The clues are in this same study.

Specifically, why have the 3.4 million not returned to work and how are they getting by? The report cites several factors:

1. Baby boomers have retired en masse.

2. Government coronavirus-related payments were a windfall. Two-thirds of unemployment claimants received payments exceeding their former income. The resulting savings still provide a cushion.

3. Employees are also employers. That is, they need childcare. Short staffing in the childcare sector impedes their own ability to work.

4. Mothers remain out, with 28% of women (vs. just 17% of men) saying they are not working because another earner in the family is bringing in enough. Families are eking by.

5. Employees do not feel pressure to return. They are looking to upskill during this time and/or return to the workforce in a better position than the one they left.

Of these five points, only number 1 is permanent. Points 2 through 4 describe transitional situations that are going to reach their end. And number 5 might suggest that something important is coming next.

In the normal course of a normal life, quitting a job is rare and difficult. The person who muscles through a job one day is very likely to keep on muscling the next and the next. COVID-19 changed this. It not only disrupted employment, but it also lessened the stigma of unemployment. As a result, people who would not have been able to act decisively on their own to give themselves pause to pursue something better have now been encouraged to do so, or placed in the position of having this pause, in some cases with a financial cushion allowing them time to figure out what better work might be.

And in many cases, manufacturing can offer this better work. That might be the next step.

Consider again the “get it” culture that has come to define many manufacturing facilities, particularly machining businesses. This mode of staffing — hiring for fit and potential and building on these traits, rather than hiring for skills — is an important advance manufacturers have made that is now ready to pay dividends. A prospective employee in machining needs certain traits as a starting point, including mechanical aptitude, common sense and orientation toward consistency and details. But given that much, many machining employers today know how to train and develop such a person to carry out the high-level work the shop needs done.

In the months to come, many of the 3.4 million will be returning to the workforce looking for something better. Modern manufacturing facilities, particularly machine shops, can offer something good indeed: high-value work in a sophisticated environment. Plus, predictable hours. This last point is an aspect of manufacturing that deserves to be better recognized. Recall point 4: Many of those currently out of the workforce are mothers who have childcare to think about or the needs of children to schedule around. Can manufacturers do more to appeal to this group?

The “Great Resignation” is going to become a “Great Reapplication” as people apply again to resume work after a period of taking stock. Manufacturers have a need for talent, and manufacturers are now better equipped than many other employers to make use of the new talent that might be part of this wave. We should prepare.