Our annual survey of manufacturing leaders is long on longevity and stability.
Table of Contents:
- The 2017 IndustryWeek Salary Survey: Smooth Sailing on Pay as Skilled Jobs Go Unfilled
- <strong>Q: What is the Biggest Challenge Facing the Manufacturing Industry?</strong>
It’s that time of year again: we unmask the results of the annual IndustryWeek Manufacturing Salary Survey. This year, we analyzed data from 780 leaders in jobs from CEO to engineering management; vp of operations to EHS supervisor.
Manufacturing may no longer be dirty, dark and dangerous, but according to the survey demographics this year, its leadership still heavily skews white, male and over 50. Our prototypical respondent is a white, male corporate executive in his 50s working in the industrial machinery or automotive industry. He has a bachelor’s degree, lives in the Midwest and has spent more than a quarter century working in manufacturing. Being in the C-Suite, he makes, on average, 180K per year.
According to our results, 2016 was a good year to be making heart monitors and joint replacements; motor oil and emulsifiers, not so much. Salaries in the medical device category topped our survey this year, while salaries in last year’s leader, chemicals, decreased 8% to $124,500 as demand slowed with the strong dollar and lower oil prices cut into revenues.
Salaries in the automotive, consulting/education and food and beverage sectors showed healthy growth (13%, 11% and 13% respectively), while petroleum and coal salaries lost considerable ground (17%).
The most lucrative job titles were vice president of manufacturing/production, CEO/CFO/COO and vice president of operations. Directors of manufacturing/production, lean and engineering managers, human resource and R&D managers and consultants also cracked the 100K threshold.
Strengths of U.S. manufacturing, according to our respondents, are certainly substantial: career stability, a family atmosphere and solidly middle- and upper-middle-class salaries.
Weaknesses include a reluctance to adopt new thinking and a slowness to address the skills gap with well-thought-out (and –funded) plans to recruit and train new workers.
Career satisfaction improved from last year, with 47% respondents saying they were “very satisfied with manufacturing as a career path,” compared to 41% last year. Thirty percent were “very satisfied” with their current job, up from 29% last year.
In addition to dollar signs and charts, we asked a series of open-ended questions about workplace culture, workforce issues and the state of manufacturing. Here’s a closer look at how our readers responded.
Q: What Are Your Biggest HR Concerns and Why?
Against the rising tide of low unemployment, manufacturing’s skilled worker shortage isn’t showing any measurable signs of slowing over last year. Sixty-five percent of respondents said their company had trouble filling a position last year, compared to 67% last year.
The No. 1 concern in the HR portion of our survey was the lack of skilled workers to fill open positions. A less-than-adequate technical training pipeline and the industry’s inability to connect with young people as they decide on a career are leaving a worrisome void.
“In West Michigan, we have a tight labor pool,” said a C-suite executive at a mid-size medical device manufacturer. “Skilled workers come at a premium. … It’s an expensive and difficult challenge for a company our size when revenues have been flat for the past couple of years.”
An engineering manager at a small wood products/furniture firm lamented that “our county has an average unemployment rate below 3%. There are virtually no workers available who actually want to work.”
Soft skills are hard to come by, said a good number of respondents. A lean/continuous improvement manager at a small building equipment company said his biggest HR challenge is “hiring people with life skills, who come to work every day, on time, and participate in discussions to improve the process.”
A human resources manager at a paper/printing company described her biggest hurdle as “finding people with a good attitude and a willingness to learn.” Right now, she’s struggling to fill operator, inspector and maintenance technician jobs.
On the flip side, employers could do a better job of making soft skills more of a priority in the hiring process. “We tend to hire on qualifications, while our internal data tells us cultural fit is the mostly likely determinant of long-term success and retention,” said a lean/continuous improvement manager who works at a medium-sized building equipment company.
An aging workforce was also on the minds of many; nearly three quarters of respondents said the issue was either a mild or big concern.
“There seems to be no effort to train people to adequately fill positions that will be left empty by individuals retiring in the next few years,” wrote a quality manager whose workplace has machine maintenance and operator jobs to fill.
Although the oldest members of the Millennial generation are now entering their late 30s, integrating this group into the workforce continues to be a struggle at many workplaces. An engineering manager at a large plastics company said engaging younger employees was his company’s biggest quandry.
A few respondents mentioned the government overreaching on its regulations, with policies like the overtime rule changing the description of salaried workers, OSHA public reporting of workplace accidents and the requirement of healthcare plans to cover contraceptives. Drug use of new employees and the inability of new recruits to pass a drug screening popped up more than a few times.
Performance review practices also met with some criticism for being too limited in scope. One respondent, an R&D manager for a plastics company, said her company’s yearly review system “pretty much guarantees people will be rated as ‘successful’ rather than ‘exceptional’ and then we’re quite locked into a raise that is about cost-of-living adjustment. People don’t feel rewarded—they feel trapped.”
Another frequent HR concern (17 respondents mentioned it specifically) was rising healthcare costs.
“We have seen nearly a 50% increase in cost over the past two years,” said a 20-something financial manager/controller in the consumer goods/durables industry.
“Healthcare costs are outpacing inflation,” said a vice president of purchasing/procurement at a manufacturing company with revenues of $100 to $500 million. “This hits lower-paid employees the hardest.”