This past year’s greatest challenge to the manufacturing and distribution (M&D) industry was the COVID-19 pandemic. More than most other industries, M&D had to wrestle with rising cost of materials, supplies and equipment as well as losing sales and revenue. There was a greater toll on M&D businesses with respect to staffing availability, productivity, and costs to operate. For this industry, nearly 70% struggled to generate revenue in 2020 and experienced either no growth or negative growth.

According to LBMC’s fourth annual Business Outlook Survey Report, M&D was one of the only industries in which more companies shed employees than hired new ones. However, not all M&D businesses decreased their hiring. High-growth M&D businesses were much more likely to expand their workforces than no-growth companies. In 2021, only 3.6% of M&D companies said they plan to shrink their employee base.

Manufacturing and Distribution Industry Hiring Trends 2021

The Tennessee hiring market for plant management is close to pre-pandemic levels. While the state continues to be an attractive location for manufacturing businesses, competition for qualified specialized manufacturing talent is an ongoing challenge. According to the report, more than half of M&D businesses plan to increase their hiring in 2021. The candidate demand in the marketplace makes it even more crucial for companies to increase salaries in order to attract and retain employees who possess the experience, skill set, education and industry knowledge required.

The majority of survey respondents indicated that their primary strategy for attracting and retaining employees is increasing compensation. A very low percentage of these high-growth M&D businesses plan to offer flexible or remote arrangements, which was the top strategy in most other industries surveyed. This is likely due to the labor-intensive nature of the work done by the industry.

A key factor in finding the right talent is understanding how manufacturing has changed. Increased automation, robotics, and advanced manufacturing equipment is driving the need for a more skilled workforce equipped with science, technology, engineering and math (STEM) skills. As a result, many manufacturers need to look beyond their traditional sources to fill key manufacturing roles.

Over the last few months, we’ve seen a growing number of requests to locate candidates for key manufacturing roles such as plant VP, plant manager, purchasing, operations and engineering. Many of these skilled positions are currently held by an aging workforce on the threshold of retirement. Leveraging our expertise and insight into the current manufacturing environment, we have been able to complete several successful talent matches for these highly technical manufacturing roles.

With a large number of the current manufacturing workforce in their 50’s, we anticipate an ongoing need to locate and recruit a more highly-skilled labor force.

Let us help you find the right talent for your key specialized manufacturing roles.

To see more insights from the M&D industry, download the LBMC 2021 Business Outlook Survey Report.

About the Business Outlook Survey Report

The report was based on results from the national Business Outlook Survey, where more than 500 business leaders, mostly in C-level positions, reviewed business activity over the past year and provided insight into the business landscape over the next 12 months. More than half of the participants represent companies with $15 million-plus in revenue and at least 50 employees. For the first time, this year’s report also surveyed high-growth companies – businesses with a growth rate of at least 20%.