5 things to consider when Reshoring – Skills

Can you find the skills necessary to reshore manufacturing into the highly efficient and automated factory floors of the US?

As your manufacturing was outsourced your internal skill ladder continued to shrink. Skilled jobs followed the production capability offshore.  Add the offshored jobs and skills to the need for new skills in highly automated manufacturing and many organizations face serious skill shortages. In an earlier Blog, “5 things to consider when Reshoring”, we identified skills as a critical element in your manufacturing location decisions.  In today’s blog we will consider how to address the skills you need.

Shrinking skill ladders

In the past many people obtained their marketable skills on the job. Companies promoted from within enabling workers to learn and move up career ladders as workers gained skills and experience.  As manufacturing was slowly offshored over the past 20 years, the system that had ensured an adequate flow of new talent equipped with state-of-the-art skills was lost as few new skilled workers entered the US workplace.

Add to this the skill loss from the retirement of older workers and the know-how simply may not exist in the US anymore. This is particularly true for entry-level and mid-level jobs that require specialized labor. In deliberating reshoring you should consider the potential need to import certain skilled workers and will certainly need to develop training programs for specific jobs, possibly with local colleges and technical schools.

Education

The factories of today and the future for made-in-America products are focused largely on progressive technologies to deliver new manufacturing techniques and produce goods efficiently. The future is highly automated machines with fewer, but higher skilled, workers. The new factory skills require computer oriented, specialized training to master highly automated machines and robots as well as 3D design and visualization. Supporting this advanced manufacturing environment will require additional technical jobs to program and service these machines. Skills such as welding or milling will still be required but will be complimented by a 2-year or higher degree requirement that includes areas such as CAD and 3D operations.

The educational bar will only get higher as technological sophistication of manufacturing continues to increase. Postsecondary technical education and college training or degrees will be required to fill the middle-skills jobs. Success is being found with business working collaboratively with educational institutions to design and fund classes to use new skills in actual or simulated work settings.  These programs deliver graduates with a clear career path. It is critical to your evaluation to determine what skills will be needed and where the workers will get training. Consider partnering with local Community Colleges as your first step.

Innovation loss

In our earlier blog on Innovation, we indicated maintaining some degree of manufacturing capacity is closely tied to innovation. We see offshoring skill loss as the reason behind innovation loss. Take the example of photovoltaic (PV) cell invented by Bell Labs. Manufacturing this new innovation was problematic as earlier offshoring drained the US market of critical manufacturing skills and suppliers. The result is production of PV cells is almost entirely in Asia and the advances in the technology and manufacturing are also in Asia. The loss of production can quickly lead to the loss of any innovative edge and in turn impact further job opportunities.

We believe Reshoring not only delivers the job creation the US needs but recaptures production knowledge and rebuilds skill ladders that are required for future innovation. Local talent and skills are essential to productivity and innovation.

Summary:

These are just a couple of factors when considering skills and no one factor should be considered in isolation. Access to skills and improving your internal skill set should be carefully considered as part of your reshoring strategy.

Originally published on Blue Silk Consulting website on May 28, 2013

Mr. Page is a Vice President at Blue Silk Consulting. He is well versed in the Asia Pacific region and OEM, Alliances and Partnership business development. His uncommonly broad and deep knowledge in business and technology plus wide experience enables him to see and communicate joint value, craft exclusive market opportunities, execute intricate projects and deliver tangible results. His consulting style provides the basis for negotiating profitable contracts, executing marketing-making initiatives, delivering high value projects and nurturing enduring relationships. His skills were gained and honed while traveling the world to work in and with organizations ranging from start-ups to the largest international corporations. Prior to BSC, he was the WW Software OEM Manager for the Asia Pacific region at HP, Director of Application and Integration Services at Answerthink, Director of America’s Consulting Services at Viasoft and Director of Redevelopment Services at James Martin & Co.

Mr. Page earned a BS in Business Data Processing at Weber State University, and completed 1 year of MBA studies at Utah State University. He resides in Scottsdale, AZ.