Study: Manufacturing an evolving industry, critical to employment

Manufacturing has often been viewed as the backbone to the economy; as the former goes, so too does the latter. If demand for production is tepid, the economy slows, and vice versa. However, while manufacturing remains a critical component to the national economy and employment market, that role is changing, a new study says. The role of manufacturing is undergoing a dynamic evolution and has opened new avenues of innovation, necessitating a talent injection that manufacturing recruiters can help businesses achieve.

Developing economies spur manufacturing shift
According to research by the McKinsey Global Institute, manufacturing is still an immense driver of global and national economies. Manufacturing has a 16 percent share of the global GDP and employs some 45 million people in advanced economies in 2010.

However, the status quo in manufacturing is changing, in large part due to the manufacturing capabilities of developing economies, which have pushed advanced ones to innovate in manufacturing to keep themselves ahead of the competition. Of the five global manufacturing groups McKinsey identified, China leads in three, the United States leads in two.

As such, McKinsey found through its research that innovation is being brought to the forefront of the manufacturing mentality and will become the most important priority for manufacturers moving forward.

"Manufacturing is entering a dynamic new phase," McKinsey said. "As a new global consuming class emerges in developing nations, and innovations spark additional demand, global manufacturers will have substantial new opportunities – but in a much more uncertain environment."

Hiring likely to increase, but manufacturers will have to take more chances
Another key insight from the research put to rest the notion that the manufacturing and service sectors are diametrically opposed, as every dollar of manufacturing output requires 19 cents of services. McKinsey cautioned global manufacturers against maintaining a traditionalist view and said new and innovative perspectives – which manufacturing recruiters can help businesses find – will be crucial to future success.

The report also weighed in on hiring. While it said "hiring in manufacturing may accelerate … [and] manufacturers will continue to hire … in the long run, manufacturing's share of employment will remain under pressure."

McKinsey said more than ever, it will become important for companies to use "agile approaches" in regard to strategizing and develop a "highly detailed understanding" of emerging markets. And while manufacturing has always been considered a more blue-collar industry, purported white-collar tactics like big data, analytics and logistics optimization will arrive with the evolving nature of manufacturing.

Manufacturing will become more competitive than ever, and manufacturing recruiters can provide a valuable service to those looking to scout and acquire new talent to bring them into manufacturing's new era.