Recent reports from two of the biggest consulting firms in the world, Boston Consulting Group and Accenture, looked at what is euphemistically being called on-shoring. What their research shows is manufacturers are discovering China is not as cheap as everyone thought. When you factor in everything from the shipping of goods to the availability of workers to the inflexibility of the supply chain and the manufacturing specifics, the cost of producing goods in the U.S. is actually very competitive with the Chinese cost.
However, human capital is one of the critical issues facing U.S. manufacturing. Between the coming renaissance in manufacturing and the impending baby-boomer retirement, manufacturers are going to have to fill millions of positions in the next decade.
In fact, we are already seeing the beginning of the problem today. In a recent nationwide survey by The Manufacturing Institute and Deloitte, 32% of manufacturers reported moderate to severe skills shortages—and this was in the summer of 2009, at the height of the recession and job losses.
The time is right for manufacturers to change the way they approach and manage their human capital. The Manufacturing Institute is rolling out the flagship education initiative of the manufacturing industry as the national solution to the talent challenge.
To develop the manufacturing talent solution, called the NAM-Endorsed Manufacturing Skills Certification System, The Manufacturing Institute joined with several other leading industry groups to create a system of nationally portable, industry-recognized credentials. These credentials and the training required to obtain them certify an individual possesses the basic skills required to work in any sector of the manufacturing industry.
The manufacturing system can be envisioned as a pyramid of skills certifications, with an initial focus on the skills required for all entry-level jobs in manufacturing today:
- Personal effectiveness skills
- Foundational academic competencies—for manufacturers, those are applied math, reading, locating, and using information
- General workplace competencies, which cover the fundamentals of business
- Industry-wide technical skills related to basic manufacturing processes, including production, logistics, machining, quality assurance, safety and health, and technology