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Q&A: PwC on How Manufacturing Execs are Handling Labor Issues Amid COVID

Amid the lasting pandemic, manufacturers are dealing with high turnover, remote work and demands for higher wages. We chat with an expert from PwC on their new data covering these issues.

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Despite 15 months of consecutive growth, US manufacturers continue facing workforce strategy challenges in the wake of the lasting COVID-19 pandemic. Roughly four in ten industrial executives expect their workforce will be a mix of full-time in-person, remote, or hybrid. Launched Aug. 19, PwC’s Next in Work Pulse Survey found that in addition to return-to-work concerns, industrial executives are struggling with employee resignation and retention, along with the Biden administration's newly-enacted mask mandate for all firms with at least 100 employees.

We at recently connected with Michael Thiessen, vice chair of Trust &Consulting Solutions at PwC, to discuss what the future of manufacturing labor currently looks like at the priorities and disconnects between employees and executives. How are manufacturing executives thinking about their workforce of the future? Have many delayed or re-considered their return to office because of the delta variant?

ThiessenThiessenMichael Thiessen: Up until a month ago, many companies were considering Labor Day as the official return to the office. But, as we have seen over the last 18 months, companies need to remain flexible and agile to the ever-changing environment. The spread of the delta variant has delayed the return to the office for many companies, and due to the uncertainty, many have not decided on an alternative return date.

Every workforce is different, so we’re continuing to see a variety in what return to office looks like across companies. Four in ten industrial executives expect their workforce will be a mix of in-person full-time, some hybrid, and some fully remote. Many aspects of the manufacturing industry require the workforce to be in person, resulting in 16 percent having all their workers on-site full-time.

Mnet: For those considering hybrid work, how are they expecting it will impact their business strategy?

Thiessen: Hybrid work can be a challenge considering the different facets of the manufacturing sector that are required to be in person – and regardless, hybrid work brings new challenges across all industries. Manufacturing executives are seeing a loss of opportunities to innovate (31%) and a loss of mentoring opportunities (22 percent) due to hybrid work.

With delays due to the delta variant and expansion of hybrid work, industrial executives, like many others, are expecting it will impact their business strategy. Nearly a fifth (22 percent) agree hybrid work’s impact on revenue growth is a major challenge, compared to 22 percent who cite it as a minor challenge. As a result, looking out 12 to 18 months, 29 percent of executives report hybrid work could shift product and services mixes. Over half (59 percent) agree it could also change processes such as automation and documentation to diminish dependency on institutional knowledge.

With over half of industrial executives looking toward automation, it is important to acknowledge technology can only reach its best and fullest potential when it is combined with a skilled workforce to create an innovative mindset and drive the right business outcomes. Companies need to make the effort to upskill their workforce as they work on their digital transformation journey to ensure compatibility.

Mnet: Across industries, we are seeing mass resignations. How has this impacted the manufacturing industry? What are companies doing to retain and recruit new employees?

Thiessen: Although the US manufacturing workforce is experiencing steady growth, it is also experiencing higher turnover rates. Across industries, 65 percent of employees state they are looking for a new job, up from 36 percent in May. Executives are finding that the pandemic has been a moment of realization for employees who are making moves in search of better wages or salaries (41 percent), personal issues (28 percent), or finding their work is not fulfilling or aligned with their values and passions (24 percent). 

With uncertainty of whether turnover rates will stabilize soon, companies will need to reconsider everything from where and how work gets done to new ways to ensure employees feel valued, included and motivated to retain current employees and bring new candidates through the door. Companies have a responsibility to encourage and provide opportunities for employees to invest in professional growth and create opportunities to increase technical capacity, become global problem solvers and have the skills and knowledge to imagine bold solutions.

Although it is important to look at the traditional benefits such as compensation and career opportunities, companies will also need to stress company purpose and values (54 percent) and stress leadership and company culture (51 percent).

Mnet: What are manufacturing executives prioritizing in the near- and longer-term future?

Thiessen: The workforce will continue to be a priority as many companies reconsider their return to office plans. As companies work through various workforce models, they need to mitigate the risks of remote work inequity head-on to ensure a culture of inclusion and belonging for everyone. 

The workforce is a company’s largest asset and the pandemic has revitalized its needs and desires. After working remotely for the past 18 months, people are expecting more flexibility and autonomy in their work-life. To get ahead of the resignation crisis, executives will need to meet employees where they are. 

In addition, providing the right tools and digital upskilling can futureproof your workforce as technologies continue to evolve and change the ways we work. Forward-thinking companies are investing in their people and equipping them with the training they need to harness the best that technology has to offer. 

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