Our team has been hearing about the challenges that a number of manufacturing owners are facing which were triggered by COVID. We’re also hearing what solutions or strategies have helped that are both creative and cost-effective.
One of the leading issues is the labor shortage, which is a concern that has been on the uptick for the last few years. Finding talent in the manufacturing world has become more difficult, and over the past year and half the pool of available talent has significantly decreased.
While there are no quick solutions, many owners have expressed an interest in sponsoring work visas as a way to find more talent. While a longer process, this could be an excellent way to bring fresh talent from overseas, which would widen up the pool of candidates and drive down labor shortages overall.
Employee Recruitment & Retention
Another reoccurring topic is recruitment and retention of current employees. In an already competitive market with limited talent, it is not only difficult to recruit top talent, but maintain employment for those who have been at the company. Some businesses are offering sign-on and referral bonuses, as well as covering day care expenses for working parents.
Manufacturers have also expressed the need to foster a healthy work culture in order to keep top talent. Developing a positive and healthy work culture will ultimately keep employees satisfied and turnover rates down, which is a better outcome for all. Even so, taking the time to cultivate a workplace culture is where the biggest challenge lies, as it isn’t created overnight. Not only do owners need to be committed, but management and employees need to have buy-in when creating a culture that is beneficial for everyone.
Supply Chain Issues
Supply chains continue to be an issue for owners. Some businesses stocked up on supplies in anticipation of shortages, while others have raised prices or introduced surcharges to make up for the high demand of materials.
The bad news is that there is just no easy solution. Supply issues are anticipated for the remainder of 2021 and well into 2022. The pandemic has affected every area of the economy, and creative resolution to supply chain issues will continue to evolve. As manufacturers try to keep up with high demand from customers, we will most likely be seeing the effects of the pandemic for years to come.
Moving into the Future
A few reoccurring characteristics that we continue to see in manufacturing is adaptability and grit, which is what will carry these businesses into the future. While there are no easy or overnight solutions to many of the issues that manufacturing business owners are facing, we continue to be encouraged by the creative thinking, out-of-the-box solutions, and willingness to reinvent themselves and diversify.
Blackhawk Bank has earned a reputation as being the bank for manufacturing, and our clients take great comfort in the fact that we 'get' the complexities of the manufacturing industry. If you are ready to find a banker who is committed to your growing business, and who understands the unique challenges of manufacturing, contact us today to learn how we can help!