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Great Resignation Driving Employee Poaching

It’s a buyer’s market for job seekers as 81,000 left manufacturing from Aug. 2020 through Aug. 2021. Manufacturers are climbing over each other to poach workers to meet increases in production.

Labor Decrease
U.S. Bureau of Labor Statistics

CPGs at PMMI’s Top to Top Summit were almost unanimous in pinpointing the labor shortage caused by employees not returning to work after covid-induced shut-downs as a critical challenge. Furthermore, turnover of staff who have returned is high. 

Top to Top Summit is an annual networking event of high-level CPGs and OEMs in the packaging and processing industry, who meet to discuss industry problems and solutions with the aim of improving industry outcome. Sponsored by PMMI, this year’s meeting was held in March 2022 in Florida.

While quit rates in manufacturing are lower than in certain poorly paid service sectors, the number of people leaving manufacturing jobs accelerated from 1.9% of the workforce in Aug. 2020 to 2.5% in August 2021 — a loss of over 80,000 workers in an industry that was already in crisis mode pre-pandemic. Labor DecreaseU.S. Bureau of Labor StatisticsTo make matters worse, many CPGs continue to cite a lack of skilled labor capable of operating and troubleshooting complex packaging machinery. As one respondent noted, “We continue to struggle with workforce shortages and the difficulty in training on equipment. As things become more complicated, it becomes more difficult to ‘plug and play’ when training new employees.” 

CPGs suggested that OEMs need to provide more and better online training resources, but training takes time, and staff turnover – even of trained staff – continues to rise. As a result, facilities are racing faster to poach each other’s workers to increase production. 

CPGs consider automation the long-term solution to the labor shortage as long as the technology also engages staff, keeping them on board. In the words of one CPG team leader, “We need to automate every operation we can. Frankly, any manual operation is being discussed, as labor appears to be a challenge for the foreseeable future.”

But the situation is already critical in some areas. Food industry production lines are reportedly standing idle because of a lack of staffing, where processors specifically pinpointed high retirement rates. It is not just young employees taking part in the Great Resignation.It is not just young employees taking part in the Great Resignation.Visier Inc. 2021Visier data from January to August 2021 (represented in the chart) highlights that it’s not just young people quitting jobs. There has been a significant increase in the number of people leaving in the 40 to 45-year-old age group and who have five to fifteen years of tenure. 

While automating less attractive manual jobs coupled with upskilling workers to retain labor in more attractive ones was seen as a solution, CPGs also mentioned the need for OEMs to offer more intuitive equipment. The head of engineering at a major personal care products company with ultraclean and aseptic processes and lines said that automated machines need to be easier to operate and maintain. Another respondent called for “high-speed automation that has the dexterity and decision-making of a line worker in the space of a line worker.” However, as was pointed out by a representative from the food industry, ensuring that machines operate with minimum downtime remains a risk. 

Source: PMMI Business Intelligence report 2022 Shaping the Future of Packaging Operations

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