The manufacturing industry faces a significant challenge: only 6 out of every 10 jobs are being filled. As companies grapple with this shortage, they need to shift their focus from merely offering competitive salaries to investing in what truly attracts and retains Gen Z employees.
Beyond Compensation: What Matters to Gen Z
While increasing wages has been a traditional method to attract new hires, it’s clear that Gen Z is looking for more than just a paycheck. According to a McKinsey & Co. research report, 43% of potential employees value meaningful work as a top reason to join an organization, and another 43% cite workplace flexibility as their reason for staying employed. For Gen Z, meaningful relationships with colleagues, opportunities for impactful work, and flexibility in the workplace are crucial factors in their employment decisions.
Declining Gen Z Workforce Participation
Since 2019, the share of Gen Z in the manufacturing workforce has been declining. This trend highlights the urgency for manufacturers to adapt their strategies to attract and retain this generation. Physical and psychological safety are key to retaining Gen Z employees. Creating a supportive and safe work environment is essential in keeping them engaged and committed to the organization.
The Cost of Disengagement
Once Gen Z employees join a company, the challenge becomes retaining them and fostering their growth within the organization. Alarmingly, 3 in 5 Gen Z manufacturing employees are disengaged, costing US manufacturers an estimated $20 billion to $40 billion per year. Engaging this generation requires a blend of digital training, upskilling opportunities, and leveraging the experience of long-time employees.
Each departure of a frontline employee can cost about $52,000 annually in recruiting, training, and onboarding productivity losses, in addition to their salary. This substantial cost underscores the importance of retaining Gen Z employees through meaningful engagement and career development opportunities.
Building Clear Career Pathways
Gen Z wants to make a difference and engage in meaningful work. They are more likely to leave an employer if there is a lack of career development and advancement opportunities. Building clear career pathways and offering these opportunities to Gen Z employees can significantly reduce turnover rates.
Focus on Leadership Development
Gen Z employees are most likely to leave a manufacturing organization within their first 90 days. To combat this, supervisors and middle-level managers should shift their focus from administrative tasks, problem-solving, and emergencies to team-building activities and helping employees meet standards. Developing leaders rather than managers can create a more supportive and engaging work environment.
Attracting and retaining Gen Z in the manufacturing workforce requires more than just competitive compensation. It involves creating a work environment that offers meaningful work, flexibility, and clear career pathways. By investing in these areas, manufacturers can build a workforce that is engaged, motivated, and committed to the organization’s success.
IFE continues it partnership with Young Fastener Professionals (YFP) and is excited to have them host a session at the upcoming 2024 show, as well as award the Young Fastener Professional of the Year during the annual awards ceremony. Register today to take part in these special events and connect with YFP at the show. More information can be found at www.fastenershows.com
