January 9, 2013
Manufacturing-jobs

Why Are There So Many Job Openings in Manufacturing?

If you have the right skills, there are more job opportunities in manufacturing companies now than at any time in the past five years. According to the Colorado Department of Labor and Employment, 7000 more manufacturing jobs will be added by 2020. A Boston Consulting Group study indicates that right now there are 100,000 manufacturing jobs going unfilled nationwide, due to a lack of skilled job seekers. I think these estimates are far too low.

I know of a small company in Boulder that posted a sign on their building that faces Route 119. The sign said, “Wanted: CNC Machinists.” The sign was on the side of their building for 6 weeks. 39,000 cars passed that sign every day. Do you want to know how many people answered their ad? None.

So there are lots of jobs to fill and no applicants. Why? There are two reasons.

Jobs That Went Overseas are Coming Back

The December issue of Atlantic Monthly has a great article titled The Insourcing Boom. The author describes the experiences of GE and other multi-national firms when they outsourced their manufacturing work to China and other low labor cost countries. Here’s what GE found out:

  • Wages in China are rising 18% per year. Their labor costs are not the bargain they used to be.
  • Transportation costs to ship finished goods to the US have skyrocketed due to the rising price of oil.
  • Low natural gas prices in the US make our production costs a lot lower than they were in the past.
  • China’s intellectual property laws do not protect US companies’ trade secrets adequately. In short, Chinese companies have been producing low-cost knock offs for years threatening long term profitability for US companies.
  • It takes over a month for goods made in China to reach US markets. That’s what is called a long supply chain. It costs US companies a lot to maintain extra inventory and an emergency shipment by plane… they can’t afford it.
  • The quality of parts made in China is not always high enough for American consumers.
  • Companies are realizing local manufacturing can be a real competitive advantage. By controlling the manufacturing process very closely they can respond to market changes more quickly than ever before.

Manufacturing Workers are Nearing Retirement

The average age of a senior machinist is 57. Think about that. There are a lot of skilled manufacturing workers who will soon be collecting Social Security. When they finally retire, there is going to be a real brain drain. Companies are taking steps to hold on to these older workers for as long as possible. But with 10,000 Baby Boomers retiring every day, there is only so much that can be done.

These two trends, re-shoring from overseas and the aging workforce will result in over 5 million new manufacturing jobs by 2020 (Source: Boston Consulting Group). Will one of them be yours?

Front Range Community College offers manufacturing courses of study in Clean Energy Technology, Computer Aided Drafting (CAD), Precision Machining Technology and Welding.

Have you considered a career in manufacturing?

About the author:

George Newman works on creating programs in manufacturing for Front Range Community College. He has a B.S. in chemical engineering from Carnegie-Mellon University, an MBA from Harvard Business School, and 30 years of experience in sales, marketing, and operations of manufacturing businesses. George is a Civil War buff and he and his wife enjoy hiking, biking, and gardening.