Manufacturing’s Future

and What It Might Mean

for the Workforce

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A FEW CORE BELIEFS: 1. Manufacturing is reemerging and

will become more important if

communities prepare themselves

2. We need to maintain places for

people to work and make things –

we all can’t live and work in a mixed

use world

3. We will need to help people create

their own jobs – which means

changing the risk profile of

economic development

4. We will need to get serious about

job training

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WHAT IS MODERN INDUSTRY? CAN IT THRIVE IN THE U.S.?

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MANUFACTURING IS NOT THIS ANYMORE

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NOR THIS

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IT’S MORE LIKELY TO BE THIS

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OR THIS

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OR EVEN THIS

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AND TAKE PLACE HERE...

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OR HERE

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AND QUITE POSSIBLY HERE SOMEDAY

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WARNING!

CONSULTANT JARGON

FORTHCOMING !

Advanced Manufacturing

Digital Manufacturing

Industrial 4.0

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THE MANUFACTURING RENAISSANCE

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TRANSLATION

Source: DFKI (German Research Center for Artificial Intelligence), 2011

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Computing power

Communication network speed

Cheap data storage

Digital to physical conversion technology

New materials and electronics

Human - Computer interfaces

Data visualization

WHAT IS DRIVING THIS ?

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ARE JOBS GOING TO DISAPPEAR ? DEPENDS ON WHERE YOU STAND

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ARE JOBS GOING TO DISAPPEAR ? DEPENDS ON WHERE YOU STAND

BCG Study for Germany – Impact of Industry 4.0

Source: BCG Perspectives Sept 2015

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ARE JOBS GOING TO DISAPPEAR ? DEPENDS ON WHERE YOU STAND

BCG Study for Germany

Source: BCG Perspectives Sept 2015

Loss of 610k production related jobs (production (4% of production jobs),

quality control (7%), maintenance, production planning)

Gain of 210k new jobs related to new technology deployment, integration and

support

ROBOT COORDINATOR

Additional gain of 700k+ jobs from new product opportunities related to

intelligent machinery, and more custom products

Net gain of 350k jobs

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WARNING!

MORE CONSULTANT JARGON

FORTHCOMING !

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OPPORTUNITIES WILL EMERGE THAT ARE HARD TO FORESEE

MICRO PLANTS

POP UP FACTORIES

DECONSTRUCTED VALUE CHAINS (INDUSTRIAL

ECO SYSTEM)

HYPER SPECIALIZED SUPPLIERS

and a new jobs yet to be defined – ROBOT

COORDINATOR

Additive Manufacturing

THE FUTURE OF MANUFACTURING IS ALREADY HERE

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$6b to $10.8b by 2021 (Wolters)

Aerospace major mover in metals

Materials advances making it more

practical

DIGITAL HAS ALREADY IMPACTED MANUFACTURING

PRINTING: YESTERDAY

PRINTING: TODAY

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At one time this was a growing industry

Now commercial printing facilities are ….

Challenged due to technology

23Credits to Chris Anderson

BUT WAIT – THERE’S MORE – THE OTHER MFG RENAISSANCE

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“FOR PROFIT”MAKER ACTIVITY MORE PREVALENT THAN MOST REALIZE

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FROM MAKER TO PRODUCT ENTREPRENEUR

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Firms

Employees

IT’S REAL AND MAKING AN IMPACT

Massachusetts

RE-INDUSTRIAL

TOOLBOX

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Land & Buildings

Supply Chain

Access & Mobility

Talent

LAND & BUILDINGS THAT “FIT” ARE CRITICAL

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Old industrial building – notice column

structure & ceiling clearance

Modern high bay building – notice column structure & ceiling clearance

TEST FIT YOUR LAND AND ROADS

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CONTEMPORARY INDUSTRIAL SPACE REFLECTS CHANGES IN MANUFACTURING

PROCESS AND LOGISTIC REQUIREMENTS

SOURCE: images Northeastern University Urban Manufacturing Design Studio, 201430

SUPPLY CHAIN DEVELOPMENT IS AN INCREASING FOCUS

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UNDERSTAND LABOR SHED TO UNDERSTAND ACCESS AND MOBILITY

ISSUES

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“WE HAVE A WORKFORCE PROBLEM”

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Industry says…

We can’t find

anyone qualified

Workforce system

says…

Tell us what you need

and we can provide

the training

They can’t

define the skills

they need

I can train them

– I can’t find

people who can

pass the initial

screen

MANUFACTURING WORKFORCE THOUGHT EXPERIMENT

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City of Philadelphia

Sample of Production Worker Age & Percentage of Occupational CategoryAge 55 to 64

% of Total Occupation

Electromechanical Equipment Assemblers 33 23%

Team Assemblers 318 17%

Computer-Controlled Machine Tool Operators, Metal and Plastic 36 21%

Extruding and Drawing Machine Setters, Operators, and Tenders, Metal and Plastic29 21%

Cutting, Punching, and Press Machine Setters, Operators, and Tenders, Metal and Plastic 54 20%

Machinists 149 25%

Multiple Machine Tool Setters, Operators, and Tenders, Metal and Plastic 32 22%

Chemical Equipment Operators and Tenders 53 23%

Production Workers, All Other 24 16%

Laborers and Freight, Stock, and Material Movers, Hand 1096 13%

1824 production workers in these sample categories are over 55

Source: Philadelphia Manufacturing Strategy - 2013

HIRING PROCESS ATTRITION

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COMPANY A

1053 applications requested

562 applications received

524 take pre-employment

exam

227 pass exam

20 invites to highest

test scores

10 offers

COMPANY B

780 pre-applications completed

Notified drug test would be required

475 completed full application

430 took employment test

75 passed test

75 Group Dynamics test

29 Interviewed

15 offers

Source: Philadelphia Manufacturing Strategy - 2013

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OBSERVATIONS ON THE WORKFORCE PROBLEM

Some of the attrition is reflective of broader social issues

Some is tied to lack of basic skills in math and literacy

The remainder are “classic” workforce issues

In other words 70%-80% of the “workforce problem” is not one

the workforce training system was designed to solve but owns

the policy “baggage”

HOUSTON, WE HAVE A PROBLEM – OR DO WE?

Based on present yield rates from cases it would take 30,000 to 60,000 candidates over 10 years to fill those jobs

Conventional wisdom says for manufacturers to survive: either workforce system will

need to become more holistic to address social and basic literacy issues to ramp up

dramatic gains in productivity as well as increased automation will be required to replace these workers

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Or does industrial 4.0

address the production

worker problem?

Will job losses caused by 4.0

be actual dislocation?

Will we be spending limited

training resources on jobs

that may not exist in 10

years?

IT’S PROBABLY NOT PROGRAM AVAILABILITY – IT’S TAKE UP

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• Community College of Philadelphia engineering technologies did not issue any degrees or certificates in

manufacturing related fields

• Camden County and Delaware County offer programming

• For Allegheny County as an illustration take up rates are still low in manufacturing oriented fields

• 4 industrial production technologies

• 2 mechanical technologies

• 6 electrical engineering

Source: Philadelphia Manufacturing Strategy - 2013

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THE IMAGE ISSUE MUST GET FIXED

PART OF PROBLEM IS THERE IS NO SUCH THING

AS “MANUFACTURING”MAKING SHOES AND MAKING STEEL ARE

ABOUT AS DIFFERENT AS IT GETS

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AND THEN THERE IS OWEN

MANUFACTURING’S 4.0 FUTURE SUGGESTS A NEED FOR OWENS

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NUMBER IS GOING UP

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HIS FRIENDS NOT SO SURE ABOUT THIS INDUSTRIAL THING

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PARENTS ARE OLD SCHOOL MANUFACTURING

Sledgehammer

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FOR COMMUNITIES ACROSS THE COUNTRY OWEN MAY BE A DOUBLE-

EDGED PROBLEM

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YOU MAY NOT HAVE ENOUGH OWENS WHICH MEANS YOU NEED TO

BUILD A PIPELINE

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YOUR PIPELINE MAY NOT BE BIG ENOUGH WHICH MEANS YOU NEED

TO RECRUIT

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AND NOW YOUR ENTERING A WHOLE DIFFERENT ZONE OF

COMPETITION – BUILDING A DESTINATION COMMUNITY

GROWTH IN CREATIVE & INNOVATION-BASED ENTERPRISES IS DRIVEN BY TALENT

And

TALENT IS ATTRACTED BY A COMBINATION OF OPPORTUNITIES & LIFESTYLE

Therefore,

TO WIN AT THE TALENT RECRUITMENT GAME YOU NEED TO BUILD A DESTINATION

COMMUNITY - THE TYPE OF COMMUNITY WHERE TALENT EITHER WANTS TO LIVE OR

WANTS TO WORK FOR CAREER REASONS AND IDEALLY DOES BOTH

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BUT OWEN DIDN’T NECESSARILY NEED TO GO TO COLLEGE

Talent might be in your backyard

But need to rewire job market

Have structures and programs to build credentials to overcome degree bias

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PARTING THOUGHTS

Manufacturing is changing

The impact is unclear but it will be real

Many levers are needed to bring it back to your region

Manufacturing’s talent needs are changing

Balancing the legacy job market needs and emerging needs is a

major issue

Offering programming isn’t enough; must help drive demand

THE END

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