Manufacturing Outpaces Expectations

Finally some good news – North American factories are humming, and driving the economy forward. Manufacturers have been hiring more consistently than other employers, for jobs with better-than-average pay.

Hardest hit by the economy, since the recession ended more than 21/2 years ago, factories have been contributing disproportionately to the recovery in hiring and the overall economy. But why? Both consumers and companies tightened their belts, not eliminating purchases in the tough times, simply delaying them. Now consumers are buying more goods, and companies are investing in industrial machinery.

An interesting gap has emerged from this recovery. With US unemployment sitting around 9%, why are factories crying that there is a shortage of skilled labour? Were the factories who fell victim to the recession in the rust belt not chock full of skilled workers? As in any large economic shift, the economy that emerges from the dust is not the same as the one that fell victim in the first place. Lean economies cause the strong companies to evaluate their processes, and become as efficient as possible. In the case of manufacturing, automation made this possible. As automation has transformed factories and altered the skills needed to operate and maintain factory equipment, the laid-off workers, who may be familiar with the old-fashioned equipment, are often unqualified to run the new automated systems.