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To say the workforce shortage taking place within the manufacturing industry so vital to Northwest Ohio has long been front-of-mind here at Gilmore Jasion Mahler is, perhaps, an understatement. The shortage was the subject of a major roundtable event our firm hosted in 2017, which drew industry experts and panelists from universities, career centers, and other manufacturing professional organizations. The roundtable, as well as our previous report on the workforce shortage, highlighted the so-called “perfect storm” that exists within the manufacturing industry.

This perfect storm involves three major factors:

1. Increased emphasis on the four-year college degree
2. Decreased emphasis on career-focused or technical education
3. Continued workforce population shift from baby boomers to millennials

Perfect Storm Meets Pandemic

Of course, each of these contributing factors has been brewing for decades, some stretching back as far as the years immediately post-World War II. In the years since, with many people encouraging youths entering the workforce to avoid skilled labor careers, and the overall public perception of the industry suffering several blows as well, fewer and fewer workers chose manufacturing. Once the baby boomer population began aging out of the workforce in 2011, the incoming workforce meant to replace them found themselves without the necessary skills.

With the early 2020 onset of the COVID-19 pandemic in Northwest Ohio and across the United States, this long-brewing storm gained yet another source of fuel for its fury. Businesses considered nonessential faced shutdowns as the nation attempted to halt the virus’s spread, leading to the layoff of nearly 100,000 skilled workers in Ohio alone. Meanwhile, essential businesses found themselves dealing with reductions in the workforce due to employee illness, regulation changes regarding social distancing, and rapidly shifting demand.

Enhanced Effects

As the United States continues to back away from utilizing products manufactured overseas, particularly in China and other politically charged regions, the demand for US products continues to rise amidst a diminishing manufacturing labor force. It’s easy to assume that at least some of the 22 million unemployed workers across the US could assuage the ongoing manufacturing workforce shortage. While it’s true that some unemployed workers could make the transition to manufacturing industry roles, the majority of America’s unemployed in hard-hit sectors like hospitality, retail, and travel are not equipped to fill open manufacturing jobs.

As a result, Ohio alone has lost an estimated 22,000 manufacturing jobs since the beginning of the pandemic. Product demand is stable or rising, older workers are retiring, there are not enough skilled workers left to fill the open positions with a labor force participation at 63.2% and still, the misconception is that desirable jobs within the manufacturing sector aren’t there.

Moving Forward

As Northwest Ohio recovers from the effects of COVID-19, the workforce shortage storm continues to cast its shadow on the manufacturing industry. Fortunately, our roundtable experts’ conclusions remain valid: Manufacturers are finding ways to adapt to the situation by altering their product offerings and taking steps to ensure employees remain safe. Career-minded individuals are more carefully considering the value of a bachelor’s degree versus career-focused technical training. Manufacturers have also stepped up in the Northwest Ohio region to establish an organization to help drive solutions. The Northwest Ohio Manufacturing Alliance (NOMA) already has a number of area manufacturers as founding members who have decided to join forces to work to solve the workforce shortage.

To capitalize on the existing forward momentum, all stakeholders must continue efforts to destigmatize manufacturing careers. Meanwhile, policymakers looking to sustain the Northwest Ohio economy need to take a serious look at how they can help bring more jobs to the area and encourage the necessary steps to build the local workforce.

Much as we concluded in our prior piece, it is only when manufacturers, schools, parents, career advisors, community members, and policymakers work together that we can begin addressing the key factors leading to the ongoing shortage and repair Ohio’s economic outlook.

For more about this topic, turn to the Manufacturing Specialist Team at Gilmore Jasion Mahler. Our accounting firm remains connected to manufacturing financial executives and industry leaders and continues to stay abreast of these essential developments. Contact GJM today, or send an email to info@gjmltd.com to request additional information.

Established in 1996, Gilmore Jasion Mahler, LTD (GJM) is the largest public accounting firm in Northwest Ohio, with offices in Maumee and Findlay. Locally owned, GJM offers cloud-based accounting and provides comprehensive services including assurance, business advisory, tax, risk advisory, healthcare management and outsourced accounting. The Firm’s professionals specialize in industries including construction & real estate, healthcare, manufacturing & distribution and utilities.