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Skilled Worker Crisis Hits Auto Industry

Shortage of skilled workforce predicted to cost automakers millions; execs look to outsource jobs

Senior automotive executives say their industry will be hard hit by the looming skilled labor shortage, according to a survey released by ATS. It is estimated that the shortage of skilled workers will cost individual companies an average $50 million dollars over the next five years. Most of the costs will be the result of training and recruiting new employees; missed production; paid overtime; and lost customer satisfaction.

It has become so difficult for some auto executives to search for and recruit skilled wokers that 70% of them said they would consider outsourcing an entire job function or department to avoid doing the work in-house. A majority of the respondents, 53%, said that outsourcing production machine maintenance would provide the most productivity gains. 

According to Kim Hill, Automotive Communities Program Director for the Center for Automotive Research (CAR), Ann ARbor, MI, "Due to anticipated retirements at existing plants, the expansion of U.S. production facilities by foreign-based manufacturers, and the general perception of manufacturing as an "old technology" industry, manufacturers will be hard-pressed to staff their facilities with qualified workers." The U.S. Bureau of  Labor Statistics reports that the skilled worker shortage will reach 5.3 million people by 2010, increasing to 14 million by 2015. 

The survey was commissioned by Advanced Technology Services, Inc. (ATS) and conducted by ACNielsen, a consulting and research firm.