Liam Merrick, sales engineer, ECI Solutions

New Zealand’s manufacturing sector faces a significant challenge amid an ongoing skills and labour shortage. The Employers and Manufacturers Association (EMA) reports that 71 per cent of employers can’t find skilled people, an increase from 40 per cent in 2022, and 90 per cent are struggling to fill vacancies (1).

Employers also face difficulties in hiring trainees and apprentices due to the lack of technical staff to train them. This issue is exacerbated by the shifting preferences of workers, who increasingly seek flexible work arrangements.

The nature of production processes has long dictated that the traditional manufacturing environment requires onsite work. However, workers across industries now expect greater flexibility in their work arrangements, and manufacturers must respond to these changing expectations to remain competitive in the labour market.

Consequently, manufacturers must adapt their practices and embrace flexible working models that can attract and retain talent, such as exploring innovative solutions to maintain productivity and growth or investigating hybrid models for supporting staff. This is particularly relevant for manufacturing workers that will benefit from modern technology augmenting their onsite responsibilities, while administrative roles may not require workers to be onsite.

For example, certain roles will always require a physical presence on the factory floor, particularly in smaller operations, though some supporting functions can be partially or fully performed remotely such as finance, management, and even sales staff in the field.

Offering hybrid options for these less-fixed roles lets manufacturers expand their talent pool beyond geographical constraints to attract professionals who may not have considered a career in manufacturing due to perceived inflexibility.

Onsite, this may involve creating more collaborative spaces, improving ergonomics, and enhancing safety measures. Offsite, it involves providing employees with the latest technologies to perform their duties remotely and create an innovative environment that attracts new talent. This dual approach ensures that all employees can work effectively regardless of location.

There are two ways manufacturers can employ technology to achieve greater flexibility: data analytics and automation. Enterprise resource planning (ERP) solutions are particularly valuable in this context.

These comprehensive systems give workers real-time access to critical data to make informed decisions. Manufacturers can use ERP solutions for seamless communication and collaboration between team members across locations.

ERP solutions also let manufacturers automate routine processes, reducing the workload on existing employees. This increases efficiency and enhances job satisfaction by eliminating mundane tasks and providing opportunities for skill development.

Manufacturers can use ERP solutions to prepare for the future by addressing several key challenges associated with workforce changes and knowledge management, such as reducing the dependency on tribal knowledge, or the unwritten, undocumented information held by experienced employees.

Centralising data and standardising processes within an ERP system lets manufacturers capture and preserve critical operational knowledge that might otherwise be lost when seasoned workers retire or leave the company. This systematic approach to knowledge management delivers continuity and consistency in operations, regardless of staff turnover or movement between locations.

Importantly, it also makes onboarding processes seamless and encourages employee retention by reducing the friction around processes and knowledge sharing.

Manufacturers can also use ERP systems to enhance process control and error prevention when integrating less-experienced workers into the workforce. These solutions provide structured workflows, automated checks, and real-time monitoring capabilities that guide employees through complex processes, reducing the likelihood of mistakes.

An ERP system acts as a safety net as new workers are brought up to speed, offering prompts, alerts, and validation steps that help maintain quality standards and operational efficiency. This accelerates the onboarding process and gives manufacturers the confidence to expand their onsite and offsite workforce without compromising on quality or productivity.

Embracing flexible working practices can reduce the strain of labour shortages on manufacturers by attracting a wider range of talent into supporting roles and functions, including those who may have previously been unable to commit to full-time work. This could include skilled administrative and financial professionals with caregiving responsibilities, living in remote areas, or seeking a better work-life balance.

Manufacturers must carefully assess which roles and tasks can be augmented by technology to transition to a more flexible working model. For example, while production line workers need to remain onsite, roles in areas such as design, finance, and administration are well-suited to hybrid arrangements, as are business owners themselves.

Identifying these opportunities and making changes to make them more desirable lets manufacturers create a balanced workforce that maximises both productivity and flexibility.

Flexible working practices will be crucial to address the skills and labour shortage as the New Zealand manufacturing sector evolves. Those who adapt to this new way of working sooner, rather than later, will be better positioned to overcome labour challenges and drive innovation in the industry.

References
(1) https://emalive.co.nz/documents/advocacy/Skills-Shortage-Survey-Results-2023.pdf