Report Reveals Changing Nature of Maine’s Manufacturing Sector Bookmark and Share

August 30, 2012

Despite job losses, worker productivity has increased; output growth predicted

Augusta—The nature of the manufacturing industry in Maine has changed a great deal over the last few generations, a new report issued by the Center for Workforce Research and Information (CWRI) reveals. “Manufacturing Jobs, Trends, Issues and Outlook” notes that the state’s trends largely reflect the nation’s changing patterns of employment and projects future manufacturing output and productivity gains based upon state and national data.

U.S. manufacturing jobs peaked in 1979 at 19.4 million; by 2010, the number had dropped to 11.5 million. Manufacturing employment in Maine also peaked in the late 1970s. The number of manufacturing jobs rose nationally by 1.7 percent between 2010 and 2011; Maine manufacturing jobs stabilized, with little change in the same period, reports CWRI, the statistical unit of the state’s Department of Labor.

One finding of the report may be surprising to those unfamiliar with the industry: manufacturing’s output changed little between 2000 and 2011. The manufacturing sector has long benefitted from the application of technical knowledge and skill. Every year, production workers, engineers and managers find better ways to solve the technical problems of production. This increasing productivity has maintained or improved the output of some manufacturers—in food and in electronics, for example—offsetting losses in such other areas as paper manufacturing.

The report indicates that, for the foreseeable future, manufacturers will be subject to foreign competition and technology-driven job and industry restructuring. Moreover, the pace of change will likely increase.

“Manufacturing has certainly seen many improvements in the form of efficiency and productivity,” said Maine Department of Economic and Community Development (DECD) Commissioner, George Gervais. “Advances in manufacturing technology have created great career opportunities for those willing to acquire the skills,” continued Gervais.

What the industry is in the midst of is one massive makeover, a transition to an even greater level of technical knowledge and skill. As a result, many Maine manufacturers are reporting a tremendous need for a better trained workforce to keep up with the changes.

This need is further complicated by the age of the sector’s workforce. The study found that almost 60 percent of manufacturing workers are older than 45. As these workers retire in increasing numbers, replacement becomes a critical issue. In addition, the findings indicate that, although unemployment remains relatively high, job openings for manufacturing workers go unfilled.

At D&G Machine in Westbrook, 30 people were hired last year alone. “It is always an enormous challenge finding qualified welders and engineers,” said D&G President Duane Gushee.

“We’re too small to spend a lot of time and money training employees to do the job,” said Rebecca Davis of Freeport Manufacturing. “When we are looking to hire, we need qualified machinists that can do more than push a button.”

Commissioner of Labor Robert Winglass noted, “Process improvement and new technologies have driven a great deal of the growth in manufacturing output per worker. Businesses over the last few decades didn’t always need more workers; instead, they needed workers who could operate computers and understand technology. Those skills remain important now.” Both the Department of Labor and the DECD are working to address these issues.

Businesses all across Maine point to workforce training as one the biggest impediments to their ability to grow. To help businesses prosper and put Mainers back to work, DECD is targeting a portion of the upcoming 2013 Community Development Block Grant program towards workforce training to help fill the skills gap.

Another LePage Administration initiated reform is the restructuring of the workforce development system with the goal of increasing the amount of money available to train Mainers for in-demand jobs, including those in manufacturing. The reform effort seeks to forge industry partnerships that better identify and respond to workforce needs. Manufacturing has been identified as one of those industry partnerships.

“Addressing the changing nature of manufacturing work and the resulting need for increased workforce skills is a priority for us,” noted Winglass.

A successful future for manufacturers will depend, in part, on filling the gap between the talent they need and the talent they can find, the report concludes. However, the outlook is positive; CWRI’s report notes that manufacturing will continue to hire skilled workers even as technology improves efficiency. It also cites data that predicts that the sector’s output will rise in the next several years.

CWRI, part of the Maine Department of Labor, develops and disseminates state and area labor market information to assist officials, employers, educators, trainers and the public in making decisions that promote economic opportunity and efficient use of Maine’s labor resources. The full report can be accessed on the CWRI website at www.maine.gov/labor/cwri/pubs.html. -end-

FOR IMMEDIATE RELEASE: August 30, 2012 Contact: Julie Rabinowitz, Department of Labor, 207-621-5009; Doug Ray, Department of Economic & Community Development, 207-624-9802