Dive Brief:

• Employers in the manufacturing industry are expanding their diversity and inclusion (D&I) programs to make fundamental cultural changes and boost business performance, according to a new report issued by PwC and the Manufacturing Institute (MI), a social component of the National Association of Manufacturers (NAM). The report said D&I program expansion is critical as industry firms struggle to attract talent.
• The report's authors talked best practices with D&I leaders from business segments including consumer and industrial manufacturing. Those conversations yielded advice for employers, including: get leadership buy-in and transmit an organization-wide message on D&I initiatives; make D&I integral to the daily business performance, and not a solitary HR program; master D&I metrics and create a D&I dashboard with recruiting, hiring, retention, leadership and promotion data; and tie in D&I achievements to overall performance/compensation.
• Authors concluded that successful D&I efforts are more important now than ever because of changing demographics. Citing U.S. Census Bureau statistics, the report points out that about 45 million people — or 13.7% of the U.S. population — are foreign-born, which is the highest number on record since 1910. The manufacturing sector could also stand to seek out more women candidates, the report said. Women make up just 29% of the industry's workforce despite comprising 57% of the total U.S. labor force.

Dive Insight:

Employers across industries are struggling to stay competitive in a tight labor market, but manufacturing faces one of the most severe talent shortages. A previous 2016 report by Deloitte found that as many as 3.5 million manufacturing jobs could open up over the next decade and that 2 million of them may go unfilled due to skills gaps. In many instances, a growing number of retiring workers is a root cause.

That means factories may need to look into untapped talent pools, and D&I initiatives can help draw those candidates. But some shops have gone even further. One Indiana manufacturer, located in an area hit hard by the opioid epidemic, has decided to offer both a job and drug treatment to applicants who fail an initial drug screen. It's an example of employers rethinking drug policies in order to be more proactive in combating a societal problem that also deeply impacts worker performance and recruitment.

It should be apparent to HR, however, that having D&I programs and objectives isn't enough, another argument made by the PwC and MI report. One common problem is that recruiting efforts branded as diverse operations don't always reach the candidates that they need to. Another issue lies in the fact that candidates may not feel welcome in the workplace despite stated company values, which may be due to a variety of reasons.

Solutions like employee resource groups and diversity committees can help provide an outlet for those brought on by D&I efforts. In the most extreme cases, leadership may need to get behind more wholesale changes. In any case, a focus on strong communication, managerial attention and leadership buy-in are general best practices.