So Many U.S. Manufacturing Jobs, So Few Skilled Workers

lack of skilled workersBy Lucia Mutikani


WASHINGTON, Oct 12 (Reuters) - U.S. manufacturers are failing to fill thousands of vacant jobs, surprising when 14 million people are searching for work.

Technology giant Siemens Corp., the U.S. arm of Germany's Siemens AG , has over 3,000 jobs open all over the country. More than half require science, technology, engineering and math-related skills.

Other companies report job vacancies that range from six to 200, with some positions open for at least nine months.

Manufacturing is hurt by a dearth of skilled workers.

"What we have been saying for quite a while is that even though there is a high unemployment rate, it's very difficult to find skilled people," said Jeff Owens, president of ATS, a manufacturing consulting services company.

A survey by ManpowerGroup found that a record 52 percent of U.S. employers have difficulty filling critical positions within their organizations -- up from 14 percent in 2010.

Owens said his company, which counts manufacturing behemoths Caterpillar and Motorola among its clients, has at any given time about 200 open positions .

"We are pro-actively working to fill them. It can take 90 to a hundred days, probably, to fill them," he told Reuters. "We are creating jobs. We just don't necessarily have the right people to fill them."

On average, companies usually take seven weeks to fill job openings.


Mismatch of Skills and Jobs

Most of the jobs hard to fill are for skilled trades, Internet technology, engineers, sales representatives and machine operators.

Yet American colleges are producing fewer math and science graduates as students favor social sciences, whose workload is perceived to be manageable, leading to a skills mismatch.

Math, engineering, technology and computer science students accounted for about 11.1 percent of college graduates in 1980, according to government data. That share dropped to about 8.9 percent in 2009.

An aging population of skilled workers is adding to the problem. As the baby boomers retire, there are fewer skilled workers available to replace them.

"Many of the younger kids that are coming out of college have been discouraged to go into manufacturing," said Dennis Bray, president and CEO of Contour Precision Group.

"A lot of the college graduates have chosen a curriculum and degree that does not give them the necessary science and math skills to be of immediate benefit to companies such as ours."

Contour Precision, based in Clover, South Carolina, does contract work for the energy and aerospace industries. It is currently looking for six technicians. It has had positions open since last year.

Unemployment in manufacturing is at 8.4 percent, below the overall rate of 9.1 percent. According to the Labor Department's latest Job Openings and Labor Turnover survey, there were 240,000 open jobs in manufacturing in August up 38.7 percent from a year ago.

The problem is sufficiently serious that businesses are pushing Congress to address the issue of visas and help them hire more high-skilled foreigners.


Structural Unemployment?

These companies' inability to fill open jobs suggests that part of the unemployment problem confronting the nation could be more of a structural nature rather than a downturn in the business cycle.

Two years after the end of the worst recession since the Great Depression of the 1930s, about 14 million Americans are still unemployed.

In September, nearly 45 percent of them had been out of work for six months or more. The longer people are out of the workforce, the more dated their skills become, making it even harder to reintegrate them into the labor market.

The types of jobs available are also changing.

Medium-skilled repetitive tasks that can be computerized continue to disappear. First, it was from from the factory floor, but it also affects the back office, where processing and support jobs are declining.

The strongest job growth is concentrated in healthcare and the scientific, technical and computer fields, which usually require at least a post-secondary education.

"The old jobs are not coming back. We need to invest in education and training to get people prepared to fill these high-skilled, high-wage jobs of the future," said Eric Spiegel, president and CEO of Siemens Corp.

Siemens is recruiting in states where unemployment is high. Pennsylvania, Florida, Texas, North Carolina, New Jersey, California, Illinois, Georgia and New York have jobless rates that range from 8 percent to 12.1 percent.

According to the Conference Board, workers with computer and math or science skills have a far better chance of getting a job, with one worker applying for every three of these types of jobs advertised. In contrast, there are roughly three people for every advertised job in sales.


Plenty of Well-Paying Jobs

Few of the thousands of jobs open in the manufacturing sector are low-wage positions.

Workers at the very low levels can earn as much as $30 an hour, with annual salaries for engineers ranging from $75,000 to $100,000. At Siemens, the average potential salary offered for its open positions is $89,000 a year.

Manufacturing lost its appeal during the 1990s when companies started moving production to Asian countries like China, in search of cheap labor. But rising wages in China are forcing some companies to bring production back home.

Although manufacturing accounts for about 12 percent of U.S. gross domestic product and about 10 percent of total non-farm employment, it has been the main pillar of support for the economy and one of the highest-paying sectors.

The shortage of skilled workers is also compounded by the depressed housing market, which is making it tough for Americans to relocate to where the jobs are.

The housing market crash has left many people with home loans owing financial institutions more than what their houses are worth, making it difficult for them to sell.


Bring In The Army

In hopes of addressing the skills gap, companies such as Siemens and ATS are turning to the military, targeting veterans. Siemens is embarking on apprenticeship programs, while ATS is running training programs for young people.

"We have found that veterans have extensive technical training and experience that they gain through military service, and these skills are extremely valuable to us and match up well with many of our over 3,000 open positions," Spiegel said.

Siemens has hired 450 military veterans so far this year.

Others are teaming up with professional bodies like the Society of Manufacturing Engineers (SME), which has developed online courses to support its members.

"We are not filling the pipeline with enough candidates for these positions. This problem has been ongoing for the last three or four years," said Mark Tomlinson, CEO of the Society of Manufacturing Engineers.

But the long-term solution lies in revamping the nation's education system to meet the current challenges and invest more in vocational training, industry leaders say.

"Often people say we do have vocational training, but it's geared towards yesterday's technology and yesterday's job opportunities," said ATS's Owens. "I am not sure the educators are on the mark with what exactly needs to be taught for today's environment."


Next: America's Youth Reconsiders Skilled Trades



Don't Miss: Companies Hiring Now


Stories from CNN Money

Add a Comment

*0 / 3000 Character Maximum

65 Comments

Filter by:
ffazio1806

Ok corporate america...you have many people out there with applicable skills but you are too picky and inflexible. You all want 100% compliance to job requirements instead of accepting partial and train for the rest. Sure you have great paying jobs but only for those people that meet ALL and I mean ALL your requirements. You want people that you can brain wash to your way making them robots to your thinking that's why you brush aside people over a certain age; elder people see through your "bs" So people have 9 of the 10 requirements what's the problem ... ? I'll tell you what the problem is...no one knows how to train people anymore. You all want the brand new, right out of the box model...the person who is able to start running the minute their feet touch the floor. College grads have the education but no experience...sorry we need experience ! Corporate america your expectations are TOO HIGH...Mr. President, I applaud you for your attempts in trying to somehow get us ALL working but unless corporate america is willing to bend and take less of what's in it for me, we will not be able to return to work. Ahh....one more thing...lets not forget those employers who think people are there to be abused. I guess they feel that there are sooooo many of us out there they can be that way and disregard the federal and state employment laws...so who would want to work for you anyway. You need some sort of excuse...

October 14 2011 at 12:46 AM Report abuse +1 rate up rate down Reply
walters474

Too many BAs and not enough BSs!

October 13 2011 at 11:16 PM Report abuse rate up rate down Reply
parthenon1

I have noticed "Sales personnel" are in short supply. It might be because there is too much emphasis on a college degree. For good sales people there should be more emphasis in face to face interviews to determine the communicating skills a candidate has, many times the best sales people were those that were difficult to deal with in High School. Not destructive but cut ups those who enjoyed the attention.
Personal pride and a very competitive nature as well as an understanding that a desire to "be a help to the customer" first will gain the person a prime position as a supplier. Also remember choosing the best sales people as sales managers is rarely a good idea, sales managers must push the lime light on to their sales force, they must lead not push and not be jealous of those top drawer people who make more money than the managers do. If they are on commission they earned top $. College in most cases only gives polish to the sales candidates but nature gives the top people the skills. Also I recently heard a top management person tell his sales force without a degree they should never be allowed to make more than $50K per yr. These are my personal observations, I earned a 6 figure income for many years as a top sales person for my company. I am retired today and miss being on the firing line!

October 13 2011 at 10:16 PM Report abuse +1 rate up rate down Reply
1 reply to parthenon1's comment
Hi Catmom!

The sales personnel are not in short supply...it is the employer that wants that extra profit in their pocket so the make do with what they have. After all minimum wage jobs don't come cheap.

October 14 2011 at 3:44 AM Report abuse rate up rate down Reply
psridgell

Odessa and Midland Texas have job openings at every business, we and others hire all the people we can, but we have such a shortage of people. Unfortunately, there is no where to live, every small parking space for a travel trailer is taken, and then some. Apartments ? forget it, all full, and they are building more as fast s they can.

October 13 2011 at 9:33 PM Report abuse rate up rate down Reply
ectullis

Affirmative action.

October 13 2011 at 9:22 PM Report abuse rate up rate down Reply
motown571

Here's how it goes kids...took four years of auto service in high school....two more years in a state colledge.Got my first job at an Oldsmobile dealership in 71 it paid 50% of the labor that was charged to the customer. Next was a Chevrolet dealer in 76 it paid 40% of the labor rate. Next was another Chevy dealer in Cali. in 80 it paid 35% of the labor rate. And finally a Chevy dealer in Arkansas in 95 that paid 27% of the labor rate. I finally retired in 09 after no raise in the last 7 years. So after 38 years of bending wrenches and tens of thousands dollars invested in tools and equipment,hundreds of hours of schooling to keep current in a ever changing business I ask you---was it worth it? P.S. Notice how much more complex vehicles have become since the 60's and how the pay adjusted accordingly! Good luck in your "skilled" trade career.

October 13 2011 at 9:02 PM Report abuse rate up rate down Reply
jgriz2000

it appears to me that many of those complaining want either a. a job created for their skill set or b. a high paying job right now where the employer spends a lot of time and money teaching them the skills with no promise they will keep at it and stay around. i paid for my education working every kind of menial job necessary to finance it. even slept in my car during the low times. nowadays when someone loses their job they keep looking for an identical job at similar pay rather than immediately seeking new skills in other fields. also they don't scale back their life style to fit their circumstances until their income improves. sorry; no one is entitled to cable tv, vacations, restaurant meals, professional sporting events and concerts, etc, etc. also; no one is entitled to a high paying job: they have to qualify for it and earn it

October 13 2011 at 6:59 PM Report abuse rate up rate down Reply
ptaray

The big falsehood that finacial is the only real job has created the huge lack of other skilled folks.

Greed has set a path many which see the big money is in finacial schemes.

The hate of this nations government is a product of a decade plus of anti-government hate being spewed by representatives and others in postions of power. Its no wonder our youth think its the government and not the idiots elected and bought by the money involved.
Our form of government is good, the idiots who create loopholes and blend their corporate law and costitutional laws that weaken our nation.
THE PEOPLE WHO DO NOT ACT ARE THE PROBLEM, NOT OUR ACTUAL SYSTEM OF GOVERNMENT. CORPORATE LAW HAS BEEN BLENDED INTO OUR CONSTITUTIONAL LAWS AND THIS GIVES THE VOICE OF THE PEOPLE THE MUZZLE, AS IT GIVES "CORPORATE INDIVIDUALS" (fake created brand named people) the loudest voice as they have the money we all invested or had to invest as part of our retirment and use ot as they see fit.
What would happen if folks started to remove their stock investments if they thought the corporations were only far right and just interested in finding ways to help regular folks LOSE their money?

October 13 2011 at 6:58 PM Report abuse rate up rate down Reply
jkcow

This is a great example of why americas education system failed us. We need to educate our youth on real world skills. Yes Math and English are needed. Where are all the shop classes that were in the schools when I grew up in the 60's. We had to take shop it was mandatory. I learned valuable skills in those shop classes that help me throughout my career. We need to modernize our education system so that our youth can get the skills needed.

October 13 2011 at 6:54 PM Report abuse +1 rate up rate down Reply
2 replies to jkcow's comment
ltjaysantos

What trade skills are they talking about?There are plenty of skilled tradesmen unemployed nationwide.Unless they mean specific skills that are not taught in our schools.The authors of these articals are so deficient,they leave important questions unanswered.

October 13 2011 at 7:56 PM Report abuse +5 rate up rate down Reply
Edward

The shop classes disappeared when they cut the funds to schools...

October 13 2011 at 9:28 PM Report abuse +1 rate up rate down Reply
ED

It would be a shame for these whiny employers to groom and promote their talent from within. There was a time that it was common place for employers to do that. Just because someone has worked on an assembly line for 5 years does not mean they can not be trained, or given sufficient encouragement, whether with tuition help, or low interest loan help, to groom them into a more complex, and important position in a company. Just my thoughts.

October 13 2011 at 6:48 PM Report abuse rate up rate down Reply

Search Articles

Top Companies Hiring

Week of July 27 - Aug 3
View All

Featured Writers

Meet the team

Picks From the Web