Labor shortage and automation

When the labor shortage comes, most employers go down since they don’t have any magic tools to solve the problem. That’s not just the developed world’s issue; all around the globe, hundreds of thousands of companies face the fact that hands are missing in their production facilities. We all know that digitization and automation are effective and useful tools to solve the problem, but their implementation needs some precautions. Now it is time to talk about the role of data because it’s fundamental in building an integrated automation system. Let’s see the US labor market, the needed special knowledge, your most essential production numbers, and the dangers on the path of digitization.

We could say that the year 2020 was remarkable in many aspects. First, we realized a dynamic start, followed by a complete stop, and finally, a slow and unstable growth. Since the pre-covid times were already challenging due to the developing labor shortage problems and the high number of order demands in the United States (as all around the world), many companies faced similar issues as today. The difference between the two eras is mainly that during covid-times, firms had to cut their developments: both in HR and regarding manufacturing processes. Thus, companies don’t have enough hands next to the manufacturing lines nowadays when facing higher order numbers and shorter deadlines.

To sum the issue up, let’s see a new Deloitte study: the US manufacturing skills gap could leave as many as 2.1 million jobs unfilled by 2030. And that enormous number means a lot of money, around 1 trillion dollars.

The increasing need for well-educated and trained workers forces companies to look at possibilities for automation. That cannot be done without data collection and analysis on the shop floor. We could say that digitization is a fundamental part of automation.

For this reason, companies need an easy-to-apply and simple industry digitization or industry 4.0 solution, like the smart sensor system of Haris Digital. Before we present some advantages, have a look at the problems we could solve by digitization.

1.Where are the workers?

In the US, the last couple of years brought dynamic changes to the job market. In the IT and industrial sectors, hundreds of thousands of workers are missing, and we could find one of the reasons in the education system. Since the number of jobs for programmers and engineers is increasing while the number of students isn’t, the gap is widening. To provide enough STEM workforce to the US labor market, the number of students has to be increased by 34 percent.

Also, coronavirus showed us that production lines based on people are vulnerable. And that isn’t the only problem with the people-based manufacturing processes. When it comes to a situation like this, people’s lives come first, not production efficiency. This makes factories sensitive to the labor’s health and well-being.

Automation (and its brother, digitization) pops up to cut this factor out of the picture. It is solving not just that issue but many others too.

Today, there are more hirings than people seeking jobs on the US job market (the number of hirings in June 2021 increased 4,6 percent, and the number of job openings with 6,5%). This situation is caused by the state benefits, the nature of the given jobs, people’s expectations (both salary and tasks), and the companies’ needs. Hiring the best men takes a lot of money – which means that companies have to compete for the more educated workers or even people at a lower education level. We could say: the price of human resources is rising, and that’s something we have been waiting for since automated solutions appeared on stage some decades ago.

Automation is not an easy and cheap solution but an excellent investment. And today is the day of committing to start.

The relationship between labor shortage and automation

The formula is simple: while the price of skilled labor is higher in the States (and all around the globe), automation is getting cheaper and cheaper. The technology, the development of new solutions, the price of research, and the cost of materials are going down worldwide. Meanwhile, the pandemic showed us that we could trust these new technologies.

But all of the automated solutions need data and well-performed data analysis. To understand the fundamentals, you should start with a simple solution like Haris Digitals.

The pandemic showed people that their wage is not guaranteed even in the most performing industrial sectors. Their workplaces could be closed one day, and machines or robots could perform their jobs. This is a stressful situation for all parties considered, and the perfect solution hasn’t arrived yet. As long as we wait for it, we should consider the importance of education and training for different tasks – these are the best tools to prepare ourselves for the future.

Many workers appeared in the healthcare sector in the United States, while in the others, the number of labor decreased significantly in 2020. This change affects the labor shortage companies experience in manufacturing industries.

2.You need special knowledge to do this

Yes, we speak about automation. How to teach a robot to handle eggs, design a machine to manipulate pills on a table, or install motor parts without manual labor? – questions you can answer with automation, the paradigm that changed the industry in the last years. But we would like to focus on a specific part of this revolution: data. Since every automated solution stands on data collection and analysis, you cannot bypass measurable information of the production system.

And to measure, analyze, design the system, define the parameters, and monitor the whole production process, you need special knowledge. Well-educated workers, engineers, and operators are crucial to keep a manufacturing site alive. They have the potential to understand and handle the changes in the production processes.

This is the most critical part of the industrial revolution we live in. We had to find out what knowledge is needed for the future. It turns out its mainly IT-related, connected to automation, hardware and software programming, big data, and measured information analysis. In the US labor market, the STEM workforce makes up 5-20 percent of workers. Even though we know a lot about automation and we have an excellent basis from our engineering-related studies, we reached the point where we have to determine ourselves to lifelong learning. Not just on managerial levels either: since machining tools and industrial processes change day-by-day, LLL is needed in all positions and jobs.

3. All the important numbers

Numbers are very important, and we don’t even realize how much. While we heavily focus on business results, we often leave accurate production information untouched. But measurement is the key to success today.

Manufacturing data makes the basis for automated processes. We could say that we don’t have anything to base decisions on without measurements: our development work and research are all based on numbers from production. After we implement some reliable measuring devices and start analyzing the all-important data, we can step on the path of digitization – and it helps us evaluate the results of new processes with automated solutions.

For a quick guide to implementation and some tips and tricks to fit them into your production, have a look at our guide with the 4As. 

The importance of data: we cannot underline it enough

Since data is the smallest building block in your production system design, we could say that the whole process collapses without it. You have to find the best parameters to measure and the most fitting models to describe your system. To perform that, you need a reliable solution at an entry level. We at Haris Digital are working on a simple solution to support your business. The smart sensor system enables you to measure what you need and focus on the pain points of your production.

You can use the setup to measure important machine parameters from your automated production lines or implement new ones and determine the optimum. The smart sensor, giving a helping hand, allows you to make real-time decisions based on real-time data from the process. That could be a significant first step to an automated line or a checkpoint in an implemented solution.

The feeling that data collection, digitization, automation, and industry 4.0 could beat labor shortages is a bit confusing. Even a well-implemented system is just a part of the solution to that issue, and worker shortage could appear on the other side of the process. You need highly educated engineers to maintain an automated production system with other well-trained personnel like maintenance, operators, trainers, and assistants. To combat the shortage, companies have to handle both sides: implement the best machine solutions and find the best men to hire.

4. Do we have to fear automation?

We cannot speak about automation without mentioning that many people and governments fear automation because of its effect on the labor market or potential accidents. And you probably heard about its impact on manufacturing processes: from danger to faster production, many different opinions are well-known, but some of them (or the most) are misleading.

First of all, you don’t have to fear automation: it’s a paradigm that makes your life easier, your job more efficient, and the products’ quality better. Since automation is better at repetitive tasks than people, many jobs could be performed by robots or automated devices. Thus, many companies see potential in applying automation, automated devices, and digitalization in production, even though we should consider some aspects before implementing these new technologies.

  • What can you automate?
  • How can you automate?
  • How long does it take to return the investment?
  • How many people’s jobs are affected by the changes?
  • How can you decrease the effect of the conversion?
 

The extent to which you should automate your production could be determined based on the demands, labor cost, the budget your company has, and the available assets. To find out the best parameters to understand the production process, you should use smart measurement systems. This way, you can detect the production’s pain points and find the most effective usage of the workforce. Having less labor doesn’t mean that the amount of work performed must be lowered: automation helps you find the way to do more with less.

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