Nearly two years after the COVID-19 global pandemic, manufacturers continue to struggle with disruptions to the global supply chain. From labor shortages to raw material scarcity to logistics bottlenecks, manufacturers are finding new, creative ways to mitigate these challenges. 

Although the pandemic has been a primary cause of current issues, it isn’t the only factor. Fear of automation, higher levels of education required to operate advanced machinery and other factors have also contributed to disruptions in the industry.

To gain a better understanding of the labor shortage, how it affects the automotive industry and what manufacturers are doing to curb the negative impacts, read on. 


What Caused the Labor Shortage?

From the start of the pandemic to early May 2021, Vietnam was considered a pandemic success story. In fact, the country’s approach to restrictions and containment efforts helped the economy grow by 2.9% during the first year of the pandemic. 

Once a new wave of the coronavirus hit in early summer 2021, social distancing measures and shelter-in-place restrictions, which were only meant to last a few weeks, continued, causing factories to shut down and slow port operations as the government attempted to mitigate the spread of the virus. These restrictions caused thousands of tired workers to leave Ho Chi Minh City where many workers remained during the lockdowns. 

The pandemic has affected manufacturers outside of Vietnam in similar ways. Vaccination requirements have driven higher turnover rates, parents are leaving work to care for their children and other workers have left for reasons related to burnout or fear of the illness. 

Additional Factors Contributing to Labor Shortages in Manufacturing

Although the pandemic has dominated the headlines for years now, there are several other factors contributing to the labor shortage in manufacturing:

  • “The Great Retirement” predates the pandemic by nearly a decade. This is the title given to the exodus of Baby Boomer technicians, laborers and management-level positions. 
  • Younger generations aren’t entering the manufacturing workforce to the same degree that previous generations did. Instead, they are moving into other industries, such as technology and healthcare.
  • Higher barriers of entry into the field are caused by the increasing intelligence of certain machinery. Some laborers have accepted the need for higher levels of education, but others are skeptical of the future of manual manufacturing. 

The labor shortage isn’t specific to manufacturing but also impacts other links on the global supply chain, such as raw materials and logistics. Currently, there’s a significant shortage of truck drivers, causing major delivery delays. 


How to Address the Labor Shortage in Manufacturing

When considering solutions to the skilled labor shortage in manufacturing, decision makers need to expand their strategy beyond labor issues to focus on both retaining their employees and exploring risk mitigation strategies. 

1. Dispel negative perceptions of the industry’s move to automation.

Although some writers predict that OEM suppliers will be cutting labor positions due to increased automation, it isn’t true that robots are going to replace the labor force. Humans will always be needed to perform tasks outside of the specific task of manufacturing. They also possess the creativity and critical thinking that is required to solve problems. 

2. Invest in continuous education. 

Automation isn’t the only advancement in the manufacturing industry. In fact, machinery continues to be upgraded on an annual basis so that procedures run faster and smoother. In order to ensure these machines run properly, technicians need to undergo training to ensure designs are properly implemented into CNC machines and robotic-assisted tools

3. Implement new digital tools.

The newest manufacturing technology isn’t just focused on machinery. Executives and line managers are always on the lookout for task management tools that can make procedures and task delegation easier and more efficient. 

4. Expand risk mitigation and procurement.

With ongoing global disruptions to the supply chain, one thing has been made very clear: Manufacturers need to have risk mitigation plans in place for when things go wrong. Procurement should be part of this plan because it requires manufacturers to analyze their procurement-related costs and discover areas for cost-saving improvements. 


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As you have learned over the past few years, the manufacturing global supply chain can be affected greatly and for long periods of time. By partnering with VPIC Group, you aren’t just partnering with expert laborers, technicians and managers — you’re partnering with a company that believes in keeping an eye on the industry by writing about ongoing trends. Doing so helps our customers better understand the industry and processes as well as what to expect when things don’t go as planned. 

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