(Reuters) – Matt Arnold has just spent $ 5,000 posting desired ads for his company’s five trailer factories from Pennsylvania to Utah.
“We hired two of the ads,” Arnold said, only a fraction of the 125 he needs to regain the strength of 673 workers. Half of the welding work at its Texas plant is open, for example, by creating a bottleneck in an operation that builds trailers on metal frames.
U.S. manufacturers have long complained about labor shortages, but last year proved particularly frustrating.
As the pandemic pushed millions of jobs, most service industries such as hotels and restaurants, many factories were forced to increase demand for everything from vans to plastic bags. And yet, high unemployment rates have not translated into workers approaching positions on assembly lines.
On Friday, the Labor Department said 916,000 jobs were created last month, most since last August, including 53,000 manufacturing jobs. This was the highest number of new factory jobs in six months.
The report’s manufacturing diffusion index, which measures the breadth of procurement in some 75 goods-producing industries, recorded one of its highest readings in history.
Manufacturing employment suffered a much less severe blow than jobs in the services sector last spring, when COVID-19 effectively shut down the economy. Approximately one in 10 factory jobs were eliminated in closures versus approximately one in six service jobs. Employment in factories is 4% below pre-pandemic levels, a deficit of 515,000 jobs, compared to 5.5% of global employment in the United States, with a total deficit of February 2020 of 8.4 million positions.
Other indicators also point to a narrow labor market in factories. Earlier this week, the Institute for Supply Management said its domestic factory activity index jumped to its highest reading in 37 years in March, with a manufacturing employment index that went up. rise to its highest level since February 2018.
A metal fabrication company mentioned in the report said “The lack of skilled talent for machines and manufacturing” has made it difficult to keep up with demand.
UKG, which provides time management for small and medium-sized businesses, said shift work at U.S. manufacturers rose 3.4% in mid-March from mid-February, surpassing an increase of 2, 6% in all industries.
(GRAPHIC – Hiring factories in the US had a general base in March 🙂
“IT’S NOT A HOME DEPOT”
The shortage comes at a time when the administration of U.S. President Joe Biden has promised to increase domestic manufacturing as part of a broader economic recovery plan aimed at creating more jobs.
“If we approve this plan, the economy will create 19 million jobs. Good job. Blue collar jobs. Jobs that pay well, “Biden said Friday after the monthly payroll report.” It’s a blue-collar model to increase people’s opportunity. “
For now, however, factories across the country see vacancies unfilled.
“I’ve never seen it so bad,” said Arnold, president of Look Trailers, based in Middlebury, Indiana. Look builds utility trailers, which are in high demand by small businesses such as landscapers and plumbers, as well as by amateurs who use them to transport motorcycles or other bulky sports equipment.
The lack of workers means the loss of business for Arnold and his customers. One of its dealerships typically has about $ 2 million in inventory in its lot, but right now it only has about $ 200,000. The average price of a trailer is $ 3,400.
Wages at their trailer factories are already well above state or federal minimums. The average starting salary is $ 19 per hour, while workers with skills as welders earn $ 24 per hour or more. “People are talking about the oil boom in the Dakotas: how workers would get in the car and go out looking for work,” he said. “We have the same thing here, a job boom. But no one is coming. ”
Many employers see a mismatch between those who are now unemployed and the jobs on their plants.
“It’s not Home Depot, or Starbucks, or a hotel,” said Kevin Kelly, CEO of Emerald Packaging Inc. in Union City, California. He estimates that one in five new workers resigns within a few days and complains about the environment.
“They’re not used to machines that need greasing,” he said, “nor to the smell of things like ink.” Emerald produces plastic bags for pre-cut vegetables, which are custom-printed with images and product information.
Kelly said she is more fortunate to hire people who have already worked in a factory. A small printing plant had just closed near him and the owner called to ask if he wanted to buy machinery. He sent a manager who ended up handing out job applications. So far they have hired five of the other company’s employees and are trying to get two more. However, even with these hires, Emerald is not yet 14 years old.
Report by Timothy Aeppel; Additional reports by Howard Schneider; Edited by Dan Burns and Chizu Nomiyama