What industry trends do you have your eye on for 2022? 
The Fourth Industrial Revolution Rising costs of raw materials and inflation Supply chain backlog Infrastructure bill pressures
(Click here for part 1)
Automation’s benefits also present a skilled worker problem
Ways to upskill your current workers to position them for the future Inflation’s effect on wages and cost of raw materials Supply chain backlog and worker shortage are creating a strain on supply and demand New infrastructure bill created new challenges and opportunities
00:00-06:51 | Impacts of the Fourth Industrial Revolution on American industries
06:51–13:29 | The increased need to upskill skilled workers 13:29-19:50 | Inflation impacting the cost of goods and raw materials 19:50–28:40 | Supply chain backlog affects skilled workers 28:40–35:31 | New infrastructure bill will impact supply and demand pressures 35:31–38:49 | Eight trends to watch going into 2022
“Greater technology drives higher skills, higher wages, and fewer candidates out there—so in solving one problem you’ve introduced another one.” – Tim Raglin
“We’re going to have to spend millions of dollars on automation, but if we can’t find the automation technicians and the skilled guys to keep this equipment running, it’s going to be a big problem.” – Brett Elliott “Upskilling is taking somebody who’s an electrician, and take those basic skills that they understand and train them to a higher level.” – Tim Raglin “For the business owner, the person who’s out there trying to keep staff up and running—you need to be looking for opportunities to upskill your current employees that have aptitude.” – Tim Raglin “Upskilling is crucial—it’s going to be crucial to meet the demand of this automated world we’re living in.” – Tim Raglin “Inflation and costs are going to absolutely exacerbate your skilled trade issue because you’re going to have to pay higher wages to keep those people.” – Tim Raglin “We thrive on challenges. Every challenge brings an opportunity.” – Tim Raglin “As leaders, we don’t shy away from challenges and we don’t ignore them—we take them on and we look for them to be opportunities.” – Tim Raglin “Let your competitors sit in the corner and whimper. You’ve got to figure out how you are going to be successful in this environment and the opportunity is going to be off the charts if you can find the talent.” – Brett Elliott “Getting creative includes non–traditional ways of hiring and adding staff, which a company like Skillwork can help you do.” – Tim Raglin “If there’s anything that we see in these 2022 trends is that the pressure to find the skilled talent is just going to increase.” – Brett Elliott2022 Trends For Skilled Labor (Part 2) – Transcript
SPEAKERS: Brett Elliott, Tim Raglin
Tim Raglin 00:08
Hello, welcome to the Skillwork Forum again. I’m Tim joined with my partner Brett, we gather each one of these episodes and talk about trends and issues and concerns and challenges all surrounding the skilled trades. This is actually part two of a two part series where we are looking into our crystal ball about trends that we see emerging that will impact you, your business and skilled tradesmen across all sectors in the coming year. So just by way of recap, last episode, we took a look at the first of eight trends that we’re going to emphasize here in this two part series. So of those eight, the first four were the the fact that skilled labor shortages are going to increase. And Brett talked at length about that. No surprise, but it’s just going to be accelerated. And actually, several of the topics surrounding the factors that are going to contribute to that. The second one was the baby boomer exodus that actually has been accelerated. Many of us know about that. But it’s going to continue to be both a brain and more importantly, an experience drain to your company in the coming year. The third one we covered was workplace flexibility. The need to become very creative in your workplace, to retain and keep those skilled tradesmen that are going to be so crucial to your success. The fourth one was the replacement worker, the concept of replacement workers. And that is a, it’s not a new concept, but it’s becoming more of reality in your space. So we, if you didn’t take a look at that one, we encourage you to go back and take a look at that one before we get into the the next topics today, which will be the four we’ll cover today: automation in the workplace. We did a whole podcast on the fourth industrial revolution, we’ll talk about how that’s going to continue and matter of fact, be accelerated. And then as we currently said, this rising cost and inflation fears inflationary pressures on your business, and specifically on the skilled trades. The fourth, sorry, the third thing we’ll cover today is the supply chain backlog that we’re currently facing and how that’s going to, coupled with growing consumer demand, how that’s going to put increasing pressures on the skilled trades. And finally, this infrastructure spending bill that’s on our horizon. So with that, Brett, let’s talk a little bit and just recap where we where we went with the fourth industrial revolution where we see that going next year.
Brett Elliott 02:40
Yeah, no, for sure. So like Tim said, we did a did a episode on that, while back on the fourth industrial revolution, but I think it’s more relevant now, as we look at at trends forward. You know, I get out into quite a few of the facilities of our clients, and I was in a facility earlier this week, actually, and, and the reality of this automation is here. I mean, it is happening, and you know, a lot of things happen, you know it and people will, when the pain point becomes high enough, then people will, will start to spend the money. Automation, this fourth industrial revolution, the only, there was two hold backs, one you had to have the technology that could support it. We now have that now with the cloud and the Internet of things and all these types of systems that allow this. You know, in concept basically in a manufacturing facility for equipment through HMI systems, you know, Wonderware is a very popular one and those kinds of things, to talk to each other. And for maintenance to become more proactive than reactive. You know, we were were for ever, we basically reacted to equipment as it broke down. We’re gonna start to see that. But I think the before you looked at it from a standpoint of do I want to spend these, most cases, millions of dollars to put this automation in place because there’s a savings involved? Now, I think it’s changed and the reason why I think it’s even more relevant, and we’re gonna see it accelerate, is now it’s happening because they can’t find the front end workers. And so so they’re now they, if you’re going to run your plant, I mean, talking to plants all the time. They’re saying they are consistently 20% their workforce is is they’re 20% short. Well, you can’t manage 20%. You can’t run your facility at full go at those kind of numbers. So the automation, you know, becomes almost a must. And like I said I was in a facility, I was in one a couple of weeks ago, I was in one. And this is a company, it’s a well known, very large company that has the resources to be able to spend the money and their level of automation, I mean, you’re talking about high high volume lines running a variety of products. And there is literally an operator, and a couple people on these lines, you know, because it’s all robotic, and it’s all conveyor systems. And it’s all, now the pressure is, which we’ll talk about and we can throw it back over to you, is then what does that mean to the skilled trades? Yeah, it’s a bone for them.
Tim Raglin 05:39
Yeah. So in solving one issue, it’s kind of like the “Oh, put a finger in the, in the hole in the dike over here and another hole pops out here”. So the real need was frontline production workers, we can’t find enough, then we have to automate our production lines. Great, you know, we’ve addressed that problem to some degree. The challenge, then is all that equipment, you know, it doesn’t run perpetually without issue. Or, you constantly have to adjust, to change, to fix, to maintain, to deploy, and that means, you’re still going to require those skilled craftsmen to be able to probably more so than ever, to keep those lines running. So in the past, you just threw more workers at the problem. And that’s not the case today. So greater technology drives higher skills, higher wages, and fewer candidates out there. So in solving one problem, which is great, you had to do something, and that’s a great way to solve it. But you’ve, you’ve introduced another one. And that’s kind of where the fourth industrial revolution is a, from a business, you have to embrace it, but it’s going to, it’s going to bring on other challenges and and this is the kind of I think the point.
Brett Elliott 06:51
No, I think the you know, for, for the, for companies, and for skilled trades, guys or gals, today. And I know, you know, both both groups, watch this podcast. And so, you know, for if you’re a if you’re currently a mechanic, or you’re currently an electromatic, or, you know, you know, in those roles, if you’re in those roles, you know, what I’m talking about. And, and so, the opportunity right now to to, to upskill, and to to get yourself trained in PLCs, and and HMI systems and this this broader technology of automation automation. We have more demand right now, in 2021 and I think it’ll just continue in 2022. More and more companies coming to us looking for that higher skill level. The it’s the like you said, Tim, it’s, it’s, you create this automation, I had a well known gentleman, I won’t use his name today, because I didn’t ask him permission. But he was president of, of a very large food company. And a couple years ago, he basically predicted this to me that that companies, he was talking about his specifically, he’s now retired. But you know, that we’re going to spend millions and millions of dollars because we have to on automation. But if we can’t find the automation technicians and the skilled guys to keep this equipment running, well, it’s going to be a big problem.
Tim Raglin 08:31
Yeah, and we’re seeing it. And so this idea of upskilling that that Brett introduced, I mean, it’s, it’s different than retraining. And a lot of things traditionally are like, I’m gonna take a, you know, a plumber and train them to be, you know, a solar energy mechanic. That that’s not, upskilling is taking somebody who’s in like an electrician, and I’m going to take those basic skills that they understand and I want to take them to a higher level. And so that’s, that’s what upskilling is, and that’s for the skilled worker out there, that’s an opportunity for you. And you ought to absolutely be looking at every opportunity for that. For the business owner, the person who’s out there trying to keep staff up and running. You need to be looking for opportunities to upskill your current employees that have aptitude. That’s why a big part of what we do is we we test people for their mechanical aptitude. If you have an aptitude, you gotta be looking at upskilling those people to replace some of those workers we talked about in the previous episode. Give your give your skilled employees the opportunity to get those greater skills. Partner with local trade schools, there’s a lot of opportunity to do that. So upskilling is crucial. It’s going to be crucial to meeting the demand of this automated world are we living in this electronic ecosystem.
Brett Elliott 09:53
Yeah, there’s no doubt about it. As I said, it’s, it’s, you know, we’re at Skillwork, you know, one of the the thing that we’re, one of our big initiatives, you know, over the next couple of years is is to certify put certification programs, and we’re working with different programs, to where where we’re going to, we want to be able to provide that to our guys, because we know the demand for them is going to be off the charts. So you know, we want to be able to provide that resource, we also want to be able to provide that opportunity to skilled workers to be able to get that. You know, it’s, it’s, it’s more than just having the the book knowledge, it’s really, you know, they call it you know, cognitive learning is really, if we could teach all of kids to, to be able to learn situationally, and to be able to. In a facility of you’re somebody running a manufacturing facility, you know, the people that are in huge demand right now are ones with manufacture experience, high level of automation, and the ability to troubleshoot. Well, that’s all situational, cognitive learning. You know, to be able to, I’m in this situation, I mean, you know, in your background, Tim with, with the military, I mean, you guys, everything was, you know, what, what do we do if this and then this, and so.
Tim Raglin 11:10
Yeah, for sure, it is a key thing. So, you know, the idea that you have, you can learn to think that way. And it’s going to be crucial to be thinking about what people do you have out there at your, at your company, whether it be construction, manufacturing, whatever it is, that have the skill that have the talent? You should be looking at every opportunity now to invest and upskill, giving them opportunity to upskill. So it’s going to be a big deal, we think it’s going to be a growing deal. And those companies that are doing it, that are planning for it, that are investing in that, are going to have going to be ahead of the curve. No doubt about it. So just to put a, you know, final exclamation point on this, just as statistic, McKinsey study, talks about, to underpin your comment earlier Brett that this automation could eliminate 73 million US jobs. Those are not the skilled technicians that keep things running. Those are the, you know, the frontline production workers, that’s what they’re looking to replace. Not because they want to put people out of a job, that they can’t find those workers. So if you have people out there working in production line right now, and they have some aptitude they show, you know, they they they have some capability, look for opportunities to upskill them. So rather than let them go.
Brett Elliott 12:29
You got to read that study, just to kind of jump on that a little bit. You can read that, that study a couple of different ways. You know, McKenzie is obviously a well respected, they do tons of this kind of work. In in that one, the 73 million is a little bit scary, to be quite honest, you know, in that, where are those people going to find work? And how Ma’am, can you upskill? And that kind of thing, and obviously we would, we would hope that be the case. But the other piece too, if McKenzie is even a little bit right in their study, and chances are they are, they’re pretty bought in that this automation is coming in now. And and so so so so that level of of automation should tell us as companies, we need to get ahead of how we’re going to do that. We’re seeing it now, we’re seeing companies who have done it, and now they’re chasing, you know, using companies like us and other resources internally that they have to find the these level of of technicians.
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