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Growth Challenge

Northeast Wisconsin manufacturers are still expanding, but the looming labor gap threatens to stunt that growth

Story by Rick Berg

February 2017

Despite more than two decades of rumors of its impending death, manufacturing in northeast Wisconsin continues to thrive, according to the NEW Manufacturing Alliance’s seventh annual Northeast Wisconsin Manufacturing Vitality Index.

The not-so-good news coming out of the survey that produced the index is that manufacturing leaders are increasingly concerned their ability to continue to expand will be limited by the availability of skilled workers.

The survey was administered in October and November 2016 by the University of Wisconsin Oshkosh’s Business Success Center, with responses drawn from 149 manufacturers in the region with $3 million or more in annual revenue. The survey found more than half the manufacturers in the region plan to modernize their facilities in the year ahead and nearly a quarter plan to expand. Nearly 60 percent of respondents reported increased sales in 2016 and more than two-thirds expect increased sales in 2017.

Those findings are fairly consistent with the results from the six previous annual surveys. The biggest change over the past seven years has been the growing perception that the manufacturing talent gap is widening.

Mike Kawleski, chair of the Manufacturing Alliance communications taskforce and public affairs manager for Georgia-Pacific Corp. in Green Bay, noted “80 percent expect to have difficulty finding people to fill their job openings. In the first year of the study in 2011, only 29 percent of manufacturers believed there was a skills shortage. It is not surprising that, with the unemployment rate being the lowest in many years and Baby Boomers retiring, manufacturers are concerned about finding the talent they need.”

The labor gap extends across the spectrum, according to Kawleski.

“Machinists were, overwhelmingly, the number one hard-to-fill occupation mentioned in this year’s survey,” Kawleski said. “In fact, machinist has been the number one occupation on this list over the last several years of the study.

“Interestingly, for the second straight year, general labor was cited as the second most difficult to find. In a nutshell, both skilled and unskilled talent is in demand.”

Plant modernization and technology can help diminish demand for skilled labor, but the available labor supply still has to grow to maintain the industry’s growth trajectory, according to industry leaders. The 2017 Vitality Index report cites several recommendations to meet that challenge, including using retiring workers as mentors to the next generation of manufacturing employees.

Boomers as mentors

“Manufacturers need to consider how to capture the skills and knowledge of the huge upcoming retired workforce and perhaps engage some of them to stay at your company on a part-time basis, possibly as mentors to new hires,” Kawleski said.

“This can be very effective, as we have a number of retirees with a wide variety of experience. Sharing this knowledge with students and younger workers in the manufacturing sector can potentially have a large positive impact on the talent gap,” said Mark Kaiser, president and CEO at Lindquist Machine Corp. in Ashwaubenon and chair of the Manufacturing Alliance.

Jim Golembeski, executive director of Bay Area Workforce Development Board, is a big fan of that strategy.

“We’re talking about Millennials coming into the workforce, and Millennials as a generation thrive on mentoring,” Golembeski said. “They’ve had coaches, teachers and helicopter parents as mentors throughout their lives. They thrive on that, so this can be a great match.”

It also works well for the Baby Boomers who are retiring, said Golembeski.

“As a generation, I think it’s very important to us to continue to feel that our careers mean something and that we still have value,” Golembeski said. “We love to tell our story, and this provides an opportunity to do that. It’s a very good strategy that can work in a lot of ways.”

Connecting students, parents and educators

As a long-term solution, the report also recommends manufacturers individually and collectively increase outreach to school systems, students and parents through plant tours and career days designed to increase general awareness of the career opportunities available in manufacturing.

“Parents are still a key in attracting talent into the manufacturing arena,” said Kaiser. “We need to share our message with parents and hopefully change their impression of the nature of manufacturing jobs. This will allow them to encourage their children to explore a career in manufacturing.”

The manufacturing sector in the New North region has already done a good job of connecting with the school systems and technical colleges, Golembeski said. But the task isn’t quite done, and it’s likely an ongoing effort.

“The educators are getting it – they’ve gotten the message,” Golembeski said. “We’ve come such a long way in 10 years in terms of improving the image of manufacturing to the point where we’ve quadrupled the number of students enrolled in welding programs at our technical colleges and tripled the number of students in machinist degree programs. But we’re far from meeting the need, so we need to continue to work at finding ways to reach parents more effectively.”

Focus on career planning

Golembeski said an increasingly popular strategy is to focus on career planning early in students’ education – with the goal of matching high school students who are unsure of their career paths with known career opportunities. He pointed to the Wisconsin Department of Public Instruction’s Academic and Career Planning initiative, which requires school districts to provide programs “to prepare elementary and secondary pupils for employment, to promote cooperation between business and industry and public schools, and to establish a role for public schools in the economic development of Wisconsin.”

The challenge extends beyond the school districts, Golembeski said. For the initiative to work fully, business leaders and local government need to participate.

“It’s really a four-step process,” Golembeski said. “First, you need a career planning tool such as Wisconsin Career Pathways to integrate career planning into the school curriculum and sustain it throughout the K-12 experience. Then you need a connection to the business community.”

Golembeski said one of the best examples already in play is the InspireWisconsin program in Sheboygan County, which connects employers, students and parents through a web-based career preparation and readiness platform.

The third step, Golembeski said, “is to have someone out there working through the issues and sustaining the linkages. Chambers of commerce in Sheboygan, the Fox Cities and Green Bay have been able to demonstrate the effectiveness (of such links).”

An industry-specific model like the NEW Manufacturing Alliance can provide sustainable links within that industry.

“Lastly,” Golembeski said, “we need to be able to take these initiatives and create a regional collaboration through components like the New North, the Manufacturing Alliance, the workforce development boards and the technical colleges.”

Reason to believe

While the challenges will remain significant for the foreseeable future, initiatives like those proposed by the Manufacturing Alliance  hold great promise, indicated Jeffrey Sachse, director and senior economist with the state Office of Economic Advisors through the Wisconsin Department of Workforce Development.

“I believe that all of the strategies are necessary given the sizeable needs in the industry,” said Sachse, who helped produce the Vitality Index report.

“I’m very optimistic,” said Kaiser. “We have already made a lot of progress, but still have a long way to go.  This issue is so broad and complicated that it will take time to resolve it, and will require true collaboration.”

“The challenge can seem daunting, but just look how far we have come in just 10 years,” said Golembeski. “We have so many major players working at this from so many different angles. There is still a lot that needs to be done, but we have some pretty bright minds working on it.”  

Rick Berg is a freelance writer and editor based in Green Bay.