In today’s manufacturing industry, addressing the tight labor market and employee churn rate amid shifting talent models remains a top priority for manufacturing organizations. Despite a record number of new hires, job openings in the industry are near an all-time high. As a result, organizations are exploring several approaches to strengthen their strategies for talent attraction and employee retention in manufacturing.
To provide an updated view of how the manufacturing industry is investing in overcoming the workforce challenge, UKG, in collaboration with IndustryWeek, conducted research in late 2022 via a survey taken by 679 operations and HR managers, and 552 production-line workers. Through the insights shared by survey respondents, we uncovered four major barriers to attracting and retaining talent as well as the key actions that can help manufacturers overcome these barriers.
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4 Strategies to Attract and Retain Talent in Manufacturing
Barrier 1: The disconnect between what employees want and what organizations offer.
Solution: The research reveals a bad relationship with managers is one of the top reasons why production-line workers leave their manufacturing companies. Furthermore, operations and HR managers cited employee turnover as the top limit to future growth. Our data shows that a disconnected relationship can lead to employees leaving, which in turn affects the development of the company. In terms of how to best attract and retain talent, respondents in managerial roles shared slightly different opinions compared to frontline worker respondents. HR and operations managers agreed that offering opportunities for advancement and positive work culture are vital while frontline workers noted competitive salary and work-life balance as more important factors when choosing an employer. The research demonstrates that both management teams have an opportunity to offer what the workforce really wants versus what’s currently offered. Investing in competitive compensation plans is one of the key actions manufacturers can take to strengthen their talent attraction and employee retention strategy. Another key action is implementing policies that provide more work-life balance—alternative shift patterns outside a standard 8-hour shift and shift swapping with colleagues without requiring approval all can contribute to an improved work-life balance for frontline workers.
Key actions: Invest in competitive compensation plans. Implement policies that provide a better work-life balance, such as alternative shift patterns and shift swapping.
Barrier 2: The balancing act between organizational needs and employee needs.
Solution: At first glance, it may seem easier said than done to offer more competitive salaries, fill up more job openings, and have more people on payroll with the increased salary. Respondents in managerial roles cited shrinking budgets as another top challenge to the growth of their manufacturing organizations. At times, it may seem like a balancing act between meeting company financial goals and meeting employee satisfaction. Investing in the right scheduling solution can help organizations overcome this barrier and discover that no balancing act is ultimately needed between business needs and employee needs. When asked about the impact of transitioning from a manual process, operations and HR managers said that through a more automated scheduling process, employee engagement scores improved, productivity increased, and labor costs were reduced or better managed. This demonstrates that manufacturers who are committed to addressing the needs of a modern frontline workforce with a consistent strategy and a dynamic scheduling solution will find themselves with a distinct competitive advantage.
Key action: Invest in a dynamic scheduling solution to improve employee engagement, increase productivity, and reduce labor costs.
Barrier 3: Scheduling is time consuming and doesn’t leave much time to focus on their people.
Solution: Operations and HR both bear most scheduling responsibilities according to respondents, with frontline supervisors and dedicated department schedulers being the primary schedule managers. Workforce scheduling often takes more than three hours per week to manage, and almost half of HR managers indicated that schedule management can take 5-8 hours per week. Frontline managers have a lot on their plate: a lengthy scheduling process, a need for changing schedules at least once or more a day, and having to contact employees about schedule changes. These time-consuming responsibilities limit the time frontline managers have to focus on their employees, and in turn could make employees feel less appreciated. As many respondents to the survey currently use a mix of analog and digital scheduling processes, there is an opportunity to use more automated scheduling solutions to speed up and streamline scheduling responsibilities, leaving more time for frontline managers to engage with their workforce.
Key action: Incorporate a more automated scheduling solution to speed up and streamline scheduling responsibilities.
Barrier 4: Misalignment and understanding between HR and operations leadership.
Solution: We already explored how there is a disconnect between what employees want and what organizations offer, but there is also a notable gap in alignment and understanding between HR and operations managers. For example, operations managers saw talent-related issues as more significant challenges to organizational growth than HR managers. And while HR and operations managers both anticipate their workforce needing to grow over the next two years, their plans to attract talent are in sharp contrast—HR managers prioritize time off packages and retirement benefits as top attractors while operations managers prioritize competitive salaries and positive work culture. As company culture often starts from the top down, these differences indicate an opportunity for HR and operations management teams to work better together to create an environment that promotes a more fulfilling workplace experience for employees.
Key action: Prioritize communication and strategic planning between HR and operations managers to align on top ways to attract and retain employees in manufacturing.
Retention in manufacturing: The takeaway
The four barriers outlined above can prevent organizations from connecting with employees and their needs. However, by taking the following strategic actions, managers and leaders can fix this:
- Invest in competitive compensation plans; implement policies that provide a better work-life balance;
- Invest in technology, such as a dynamic scheduling solution, to improve efficiencies and productivity;
- Incorporate a more automated scheduling solution to speed up and streamline scheduling responsibilities.
- Prioritize communication between HR and operations managers.
Investing in your people means investing in your business—both are interconnected in a holistic way that can lead to a better future for your organization. This is more important than ever in today’s tight labor market. Now is the right time for manufacturers to align on business objectives and technology to support the frontline workforce while driving future organizational growth.