Two Key Steps in Minimizing Attrition within Advanced Manufacturing

The manufacturing industry is plagued with one of the highest turnover rates of any U.S. industry. In fact, two in five manufacturing companies (43%) report an annual turnover rate of over 40%, while the average turnover rate in other sectors is just around 2.5%. The financial drain associated with this attrition is debilitating to a manufacturer’s bottom line, as training can start at $5,000 per hire, with an additional $1,500 per employee each year. Which means when that hire leaves, so does that investment. Of course, that’s only a portion of the drain. The production loss associated with that employee’s function needs to be factored into the deficit, as does the overworked staff temporarily tapped to fill in for that person, which can impact morale and perpetuate further attrition. And the bleeding doesn’t stop there, as hiring a replacement can cost, on average, $5,159 before the aforementioned training investment starts all over again. 

The disparity in exodus rates between advanced manufacturing and everyone else is complicated. ZipRecruiter reports an average annual salary of $76,318 in advanced manufacturing in California today, who simultaneously reports 1 million unemployed residents. Yet many of the 7,724 advanced manufacturing jobs listed on that site alone don’t require a four-year college degree, and, as we know, offer training. According to The Fabricator, however, one welder states that the lack of interest is about more than money, but earlier exposure to what these trades entail in middle and high students. “Let them discover the joy of running a bead or fabricating a catwalk or milling a hub as a kid. Or let them find out they hate it,” says Josh Welton. “Either way, you’re going to attract people who want to be where they are, instead of being everyone’s Plan B.”

This lack of exposure when it counts is directly correlated to the “dirty hands” stigma of advanced manufacturing, which – while shifting – still persists among parents and teachers today. Put frankly, the same sectors that keep us warm, fed, safe and well-traveled, are the same ones we put a less-than value on compared to a doctor or a lawyer. This is why so many employers are suffering from the ‘warm body syndrome.’ Out of sheer desperation to meet consumer demand, many are forced to recruit quantity over quality, accepting – and budgeting for –  a six-out-of-ten-left-standing workforce.

Consider these two steps in mitigating costly attrition: 

1. Optimize Candidate Sourcing

Not to be confused with recruiting, candidate sourcing is the process of searching for, identifying, and contacting potential candidates for roles you are recruiting for in the future. Recruiting happens after sourcing, and incorporates the screening, interviewing and evaluating elements of the recruitment process. This means that proactively searching for candidates, regardless of current vacancies, is paramount in keeping a talent pipeline full with workforce at the ready. 83% of companies report they already do this, however, advanced manufacturing wouldn’t be bracing themselves for 2.1million unfilled jobs by 2030 if this were being performed effectively. “HR departments need to essentially become hunters, running to find hires,” laments one recruiter, “until we can make the perception shift of hires running to us.” 

This is because traditional advertising through job banks and boards is not effective at reaching students who are not yet on the job market, but poised to choose a career path that could lead them right to you post-secondary. They are also not effective in reaching those who are already employed, but would not naturally think of manufacturing as a career. Today’s tight labor markets require more innovative and broad-reaching strategies that can both influence perception of these careers early on, as well as provide access to skills development that will make a future candidate employable, and interested. There are 65 million students about to hit the workforce over the next seven years. This scarce talent pipeline issue is not a people problem, but an awareness problem. Access to them is paramount in making the needle move for good.

2. Manage Candidate Expectations 

Misalignment of expectations accounts for 60% of turnover in advanced manufacturing. Which is why many employers offer Realistic Job Previews, or RJPs, that offer a realistic look into what a job is actually like – no sugar coating – showing both the positives and negatives. This provides a candidate a feel for what a typical day would look and feel like, the depth of knowledge and skills required, boundaries of their specific responsibilities, work schedule requirements, and the quality of work you’re looking for. While a trusted qualifier in candidacy, logistically and operationally, this is very expensive, especially when you factor the 40% who walk away. 

Allowing potential future candidates to “try on careers” in advanced manufacturing is spot on, however. Giving students access to the lexicon, the pathways and skills needed for them to decide for themselves, void of parent/teacher influence, provides them with the agency to intentionally pursue that career, providing you with a vetted pipeline. Doing this at scale means doing it digitally. 97% of Gen Z has access to a smartphone, where they spend seven hours a day. A digitally transformed approach to workforce development = high impact. 

Start there.

Interested in learning how skillsgapp employs a two-step approach to minimizing turnover? Email us here.

Four Reasons Why Gamification Should be Used in Skills Development

Let’s face it, job training isn’t something many people look forward to. It can be the most tedious and boring part of being hired at a company. However, there is a solution that can remove the mundane. According to continu, “Gamification in training is the process of applying gaming designs and concepts to learning or training sessions in order to make them more engaging and entertaining for your employees.” It offers a more innovative way for organizations to recruit a future workforce, as well as an opportunity to get them more excited about the career they’re about to embark on. 

Here are four ways that gamification can improve manufacturers’ skills training development, and recruitment: 

1. It allows learners to better control their own learning experiences.
It’s essential to keep recruits engaged throughout the entire process as well as develop a process that gets new candidates in the door. There’s nothing about sitting down to watch a series of videos during skills training that actively gets someone’s attention. However, by giving them some control over the progression of their training, you can make them an integral part of the process rather than just having them passively observe. 

2. Gamification offers manufacturers faster feedback that can allow them to improve training procedures in real time.
Continu notes, “With more traditional training, you learn your score, or are given advice once your session is completed. With gamification in training, users are given feedback as they progress throughout the training.” This allows for real-time adjustments to be made as the training continues, making the process more efficient and attractive to a newer, digitally-minded generation.

3. Gamification can draw in the younger generation to your training.
The manufacturing industry can take notes from construction companies’ success at this. Caterpillar is recruiting younger workers and enhancing its operator training programs with game-based simulators. This hands-on approach to learning gives students the opportunity to understand — and develop an affinity for — machine controls and operating procedures prior to entering the workforce, which makes them more qualified candidates when they come of age. 

4. Gamification can make your company or organization stronger.
Making training interesting is key for new recruits to stay with you throughout the process. Think about it — if your training process is a bore, they won’t retain as much or be excited about it. Continu explains that gamification can allow users to enjoy the process, retain more, and ultimately use these newfound skills to strengthen your company. Their success can also inspire loyalty, mitigating the ever-costly workforce attrition. 

What’s The Bottom Line?

It’s safe to say that gaming matters to manufacturers and the future workforce alike. When they’re at the top of their game, your bottom line wins.

  • Discover ways to engage with your workforce pipeline earlier
  • Scale career awareness and pathway access, especially for the underserved
  • Gain a competitive advantage for recruitment supported by meaningful data