How Labor Shortages Affect Manufacturing, and What You Can Do About It

If you’ve been tuned into national news, you’re no stranger to the current labor shortage plaguing industries across the country. Businesses—particularly those in the manufacturing sector—are struggling to hire enough employees to meet quotas.

One way businesses, including those in the food and beverage manufacturing sector, are making up the gap is through increased automation. This decrease in human involvement can lead to increased issues in the food and beverage manufacturing space that need to be addressed, from increased foreign material contamination issues from the introduction of more machines to more frequent problems with final product quality. The domino effect in this case is that more manual labor is then required for tasks such as repackaging, rebundling, relabeling, manual product inspection and the like. 

More Than Numbers: Data on the Current Labor Shortage

The U.S. has 3 million fewer workers today than it did in early 2020, which is about a 2% decrease. So far this year:

  • New hires averaged 6.5 million
  • Employee turnover averaged 6 million 
  • Job vacancies continue to surpass 10 million

Those numbers are noteworthy. For every 100 job openings, there are only 60 potential workers available to fill them.

Fighting labor shortages isn’t just about hiring new workers; it’s also about retaining current workers. In 2022, more than 50 million people quit their jobs in search of better work-life balance, increased flexibility and higher compensation. Since July of 2021, the food and beverage industry has endured the consequences that come with a high quit rate—consistently above 4.9%

It could be argued that the current labor shortage in the manufacturing industry has been a long time coming. Data from Industry Week shows that in 2009, 52% of teenagers had little or no interest in manufacturing, their top reason being they didn’t consider it a professional career choice. Today, those teenagers are in their late 20s or early 30s, which would make them the ideal candidates to fill currently open manufacturing jobs—if they actually wanted them. 

For some time, manufacturing workers have primarily come from the baby boomer generation. As they retire, the food and beverage industry is affected more than others. The combination of an aging workforce and the inability to find suitable replacements indicates that despite unemployment being at historically low levels, more than 2 million manufacturing jobs in the U.S. will likely be unfilled by 2030. With less and less labor resources available, manufacturers must find a solution that enables them to meet production demands and fill quotas. 

The Trickle-Down Effect of Labor Deficiencies 

According to the U.S. Bureau of Labor Statistics, around 750,000 jobs in the manufacturing sector currently remain unfilled, and we know that number is only going to increase. In many cases, hiring more workers isn’t a viable or sustainable solution. How can producers who have work to be done but don’t have the laborers to do it remedy the issue? 

In lieu of outsourcing, food and beverage producers continue to advocate for increased automation to maintain in-house control. However, with more automation comes more margin for error—another issue producers can’t afford. Additional technology can cause issues such as foreign material contamination, product defects and more; when those issues arise, the need for labor to fix them becomes once again present. 

Another solution deserving of consideration: outsource tasks that require significant manual labor. In the food and beverage sector, those tasks might include repackaging, rebundling, relabeling, manual product inspection and more. In a future where manufacturers will be increasingly limited on available labor hours, these high-effort manual labor tasks will nearly always be a loss leader. That’s why options exist to invest in the laborers you need, only when you need them. Your production line can remain largely unaffected by labor shortages, because you know where to look in a pinch. 

Labor shortages create a complex problem for manufacturers, and this issue is one that industry leaders need to be prepared to solve. The good news is, solutions do exist—it’s simply a matter of implementing them. While solutions do mean added costs, they are nearly always outweighed by the long-term benefits of using flexible labor and innovative solutions. 

Labor forces are something producers must continue to monitor closely, and begin planning for the future today. For more information about one option that can help remedy the negative side effects of labor shortages and, in some cases, increased automation, visit our flexible solutions page. 

When you don’t have the solution, FlexXray does.