As with most industries today, the manufacturing industry is experiencing constant shifts due to continued technological innovations. These changes are affecting different aspects of work such as job availability and workforce demands.
Whether you’re an employee or an employer, understanding your industry shifts is vital to stay competitive. Here’s what you need to know about the 2024 Bureau of Labor Statistics (BLS) Report.
Manufacturing Trends from the 2024 BLS Report
Employment Trends
The value of the manufacturing industry can’t be understated, currently contributing around 10-11% of US GDP.¹ It connects many industries such as raw materials, transportation, and logistics. Generally, the manufacturing sector transforms raw materials into goods that fuel other industries, which can include the automotive, technology, and healthcare industries.
Decrease in Job Availability
Despite the importance of manufacturing, recent statistics show a decrease in job availability within the industry. The latest BLS report for September 2024 showed 7,000 fewer manufacturing jobs compared to the numbers reported just a month prior.² This is subsequent to a more substantial loss of 27,000 positions from July to August of 2024.
This trend suggests that both employers and employees should be ready for significant shifts within the job market.
- Employers should consider reassessing their operations and optimizing production to remain competitive despite having a smaller workforce.
- Meanwhile, employees can invest in upskilling to ensure that they can adapt to the changing needs within the sector.
The Institute for Supply Management (ISM) backed up this trend with their own research. They found that the employment index fell by 2.1 percent within the year, which further indicates the fast pace of job losses in the manufacturing industry.³
Wage Data Analysis
Despite the challenging employment landscape, wage trends offer some positive news for manufacturing workers.
Hourly Earnings Increased Slightly
Based on industry research, there is a slight increase in the average hourly earnings for all employees. This points to the intent of employers to invest in retaining their skilled professionals.
Although it’s a modest increase, this is a good sign that employers still value experienced workers. They are actively competing to retain talent despite the contraction (decline in economic output) happening in the market.
Working Hours Remain Stable
The stability in working hours proves that businesses are able to manage costs and responsibilities despite workforce reduction. Employees maintain an average of 40 working hours per week. The overtime hours edged down by 0.1 from previous months, showing a promising stability of predictable schedules and consistent income for employees.
Industry Growth Projections
Looking ahead, there are several indicators that suggest a complex landscape for the future of manufacturing. For example, the Manufacturing Purchasing Manager’s Index remains in contraction at 47.2 percent.³ This marks the sixth consecutive month of decline, which signals ongoing struggles within the sector.
- For leaders, this points to the need to prepare for continued market shifts. It’s important to be prepared for any potential changes to both the industry and the job market.
- Meanwhile, for workers, this extended period of contraction suggests that job security might remain uncertain in the following quarters. Companies may be cautious about expansion and hiring, so it’s vital to focus on learning in-demand skills whenever possible.
Fortunately, the New Orders Index suggests that the rate of job decline may slow down in the future. This is proven by its increase from 44.6 percent in August to 46.1 percent in the latest reports.
Meanwhile, the Production Index’s rise to 49.8 percent from 44.8 suggests that companies are approaching stability in their output levels, which further supports workforce stabilization.
5 Key Manufacturing Takeaways
Considering available statistics, professionals across all verticals should be mindful of the following key takeaways from the BLS report for the manufacturing industry:
1. Enhance Workforce Productivity
In the current manufacturing environment, employers must focus on implementing comprehensive performance metrics and structured workflows. This can help their business maximize output while meeting quality industry standards.
For leaders:
- Consider developing incentive programs tied to productivity improvements
- Invest in workflow optimization tools that support lean manufacturing principles
- Conduct regular productivity reviews and feedback sessions with teams.
Meanwhile, employees should:
- Focus on consistently meeting or exceeding production targets
- Take the initiative in identifying process improvements based on their front-line experience
- Invest in improving time management skills to optimize their personal productivity
Read more: 8 Tips to Overcoming Process Bottlenecks for Improved Efficiency
2. Focus on Upskilling and Retention
With the contraction in manufacturing positions, leaders should ensure that each of their employees is equipped with the latest skill sets necessary in today’s world of work. This can be done through consistent commitments to employee development.
Partner with experts who can provide high-quality training and workshops. Invest in your human capital to ensure that your organization maintains its competitive edge while building employee loyalty at the same time.
Employees should do the same thing and actively pursue developmental opportunities. For example, they can remain up-to-date on industry trends and emerging tech tools that can be useful in their line of work. They can also maintain the latest certifications to ensure they remain valuable to their organization.
3. Participate in Mentoring Programs
Establishing formal mentoring frameworks has become increasingly important in manufacturing organizations. Employers should create structured programs with clear objectives and guidelines. Their plans should also include recognizing and rewarding mentors for their contributions.
Having knowledge-transfer protocols in place for critical processes ensures that valuable institutional knowledge is preserved. This is especially crucial during periods of workforce reduction and industry transformation.
Employees at all levels can benefit from mentoring relationships too. Experienced workers should actively share their knowledge and document critical processes, while newer employees should seek guidance and maintain detailed notes from mentoring sessions.
Businesses can even explore and try other methods such as reverse mentoring. This can create a more collaborative and innovative workplace environment while bridging generational gaps in expertise.
Read more: Progress in Manufacturing: Women Who Are Pioneering Advancements
4. Leverage Benefits and Compensation
Here is our advice to employers in light of current wage trends:
- Structure competitive compensation packages that consider both monetary and non-monetary benefits. Beyond the base salary averaging $34.42 per hour, organizations should consider developing performance-based bonus systems and comprehensive health and retirement benefits.
- Work-life balance initiatives and recognition programs can also help maintain employee satisfaction since these have become some of the top priorities of employees across different sectors.
For workers, understanding and fully utilizing available benefits is crucial for maximizing your total compensation package.
- Maintain records of your performance metrics for salary negotiations.
- Stay informed about industry compensation standards so you can ensure you are properly compensated for your work.
5. Embrace Technology Application
Despite the current economic decline, investment in modern manufacturing tools can prove valuable, especially for long-term success. Employers must learn how to develop strategic implementation plans to help their people successfully adopt tech tools into their daily operations.
On the other hand, professionals must also be comfortable working with machines and automation. Instead of viewing them as competition, it’s best to see technology as an asset. Take the time to embrace digital transformation by learning new tech-related skills that are in demand in the manufacturing sector. This investment will improve the operational efficiency of your organization as well as your value to the team.
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References:
- Thomas, Douglas. Annual Report on the U.S. Manufacturing Economy: 2023. 25 Oct. 2023, https://doi.org/10.6028/nist.ams.600-13.
- “The Employment Situation – September 2024.” Bureau of Labor Statistics, 4 Oct. 2024, www.bls.gov/news.release/pdf/empsit.pdf.
- “Manufacturing PMI at 47.2% September 2024 Manufacturing ISM Report on Business.” Institute for Supply Management, 2024, www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/pmi/september/.
