Toyota – ‘Driving’ Change in Employee Recruitment and Retention

Manufacturing leaders at Toyota Motor Manufacturing Kentucky (TMMK) are driving change in employee recruitment and retention. TMMK leaders are offering incentives, rolling out impressive new technology, as well as publicizing robust compensation and benefits packages in their efforts to attract new talent. Theirs could be an appealing strategy for manufacturers considering industry skills gap setbacks and costs to hire professionals with advanced degrees.

The problem

Executives at Japanese firm Toyota are facing a skilled labor shortage in their U.S. manufacturing plants that has company and state officials taking a more pragmatic approach to finding solutions as they plan for the future. Of course, the looming labor crisis doesn’t only affect Toyota; it is also a problem affecting manufacturers across the country and one that threatens to severely limit manufacturing sector growth in the coming years.

According to the Deloitte and Manufacturing Institute report, “The skills gap in U.S. manufacturing: 2015 and beyond,” the U.S. economy increases $1.37 per every manufacturing dollar spent, and every 100 jobs created in manufacturing leads to the creation of 250 jobs in other sectors. Without a doubt, the manufacturing sector is a vital economic motor — but one on the brink of stalling should industry and government officials fail to address the skills shortfall.

Experts estimate more than two million manufacturing jobs will go unfilled during the coming decade. Why? Baby boomers are retiring. Younger people perceive manufacturing as “dirty” and harmful to the environment. Too few high school curriculums include technical training programs. Students’ proficiencies in science, technology, engineering, and mathematics (STEM) proficiency are faltering.

Finding a solution

To solve these problems in Kentucky, representatives and manufacturers are speaking to students, high school principals, career counselors, and parents to spread the word that manufacturing is surging — and it’s a sound career choice. In fact, in February 2018, Kentucky Governor Matt Bevin participated in a panel discussion as part of the National Association of Manufacturers’ (NAM) “State of Manufacturing Tour.” Those participating in the nationwide tour aim to ignite interest in U.S. manufacturing by highlighting the evolution of domestic manufacturing, the need for a more technologically advanced workforce, as well as efforts to improve educational and career prospects for young people.

But NAM members and Kentucky manufacturers are not the only ones with vested interest in building the manufacturing workforce. As a manufacturing and automotive industry leader, Toyota’s executives are also investing in efforts to confront the skills gap crisis, training and promoting employees who demonstrate potential to learn advanced skills. As part of their campaign to change attitudes about manufacturing and its effects on the environment, the automobile manufacturer built the Production Engineering and Manufacturing Center (PEMC). The 235,000-square-foot, $80 million facility is a “state-of-the-art and environmentally-conscious” example of the Toyota commitment to greener practices.

But Toyota leaders’ efforts extend beyond the production floor to investments benefitting STEM programs:

  • An approximately $400,000 donation to Morehead State University’s STEM curriculum development for elementary schools
  • A $50,000 contribution for “Robotics on the Road to Coding,” a Kentucky Science Center program that will teach coding basics to K-10 students
  • A partnership with the University of Kentucky to create an undergraduate certification program for automotive production engineering

According to the “Toyota Kentucky Tackles a Tool-and-Die Worker Shortage “ Industry Week article, TMMK Assistant General Manager Wally Palen recognized the shortage and identified the need for a new recruitment strategy. That lead him to collaborate with Bluegrass Community and Technical College in the creation of an apprenticeship program. Palen and his team developed the curriculum, allowing students to earn while they learn.

Many factors make the state an appealing place for manufacturing leaders and their employees according to Chief among them, from an employer’s perspective, are the state’s recently enacted right-to-work legislation and employer confidence in the Kentucky workforce. For employees, the average manufacturing wage in the state is $57,000 per year and growing.

The growing collaboration trend in educating the workforce of the future illustrates a greater need for cooperation in devising promising and comprehensive solutions.

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