Manufacturers are doubling down on diversity: Here’s how

October 9, 2018

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By Jeff Sorensen and Carolyn Lee

Today, PwC and The Manufacturing Institute—the social impact arm of the National Association of Manufacturers (N.A.M.)—are joining together to release a new report: All In: Shaping tomorrow’s manufacturing workforce through diversity and inclusion

This paper is focused on how U.S. manufacturers are expanding their diversity and inclusion (D&I) programs, and it appears at a time when the industry has come to an interesting crossroads. As a survey released just last week by the N.A.M. shows, the sector is currently enjoying strong levels of optimism, with investments, wages, and jobs all on a healthy trajectory. Yet, the survey also reveals that manufacturers are worried about the glut of open jobs in the field and the lack of skilled workers to fill them—a workforce crisis that is projected to get even worse in the years to come. At the same time, manufacturers also find themselves having to continually adapt to the challenges that automation and digital technologies bring to how and what they produce.

It’s fair to say that the manufacturing industry is in a state of reinvention. Such a reboot is necessarily going to require changing approaches to the workforce: who to recruit, who to retain, who to promote—and how. In this climate, manufacturers are carrying out more sophisticated and ambitious D&I initiatives and embedding them throughout their organizations. But what exactly are the best ways to do this as manufacturing continues to evolve and America’s demographics continue to shift?

That’s the question PwC and The Manufacturing Institute sought to answer with this new report.  We carried out interviews with chief diversity officers at manufacturing companies, as well as other D&I advocates outside the private sector, and the insights and experiences we uncovered were revealing. We found that many companies are already expanding their D&I programs, often with twin purposes: first, to create fundamental changes in their cultures; second, to improve their business performance with a more diverse workforce. And, while there are numerous ways to make both happen, the following “best practices” emerged from our virtual “roundtables” with D&I professionals:

  • Get leadership to lead on D&I and transmit that message through all ranks of the organization;
  • Make D&I a core (and daily) business performance issue, and not an isolated HR program;
  • Master D&I metrics (create a dashboard including all D&I-related recruiting, hiring, retention, promotion and leadership data);
  • Tie D&I performance to overall performance/compensation;
  • Organize and empower D&I employee resource groups (ERGs);
  • Cross-pollinate ideas (across functions and geographies);
  • Enable free dialogue–and carry out regular training–around D&I; and
  • Drive D&I to help close the skills/talent gap.

In other words, successful D&I efforts hinge on making D&I a pervasive business imperative—both mandated from the top down as well as arising from grassroots levels (e.g., via employee resource groups). And making a company’s D&I efforts successful has never been more important, because it is increasingly emerging as an imperative throughout organizations–not just as a human resources mandate but as a core business mandate. Consider that, today, 13.7% of the U.S. population (or 44.5 million people) is foreign-born, the highest percentage recorded since 1910 (according to recent figures from the Census Bureau). Or remember that, while women comprise about 57% of the total U.S. labor force, they represent one of manufacturing’s largest untapped pools of talent at just 29% of the manufacturing workforce.

It seems the only certainty in the manufacturing industry today is that things will continue to change. The economy is changing. The way things are made is changing. The skills, needs and aspirations of the people who make them will continue to change, too. Manufacturers will have to keep up if they want to stay competitive. When it comes to the workforce, our report shows that many are—and that many recognize that there is still further to go. We believe the best practices in our report help point the way toward the continuous improvements that ultimately benefit everyone—manufacturers, workers, our changing society and our growing country.

(For a look at what diversity and inclusion means in practice for men and women in the sector, we hope you’ll check out a new gallery of inspiring stories hosted by the M.I./N.A.M.’s Creators Wanted campaign that is launching online alongside this report today. Just head over to https://www.creatorswanted.org/be-you-in-manufacturing/ to see for yourself).

©2018 PwC. All rights reserved. PwC refers to the US member firm or one of its subsidiaries or affiliates, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.

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