Manufacturers Pay a Bounty for Skilled Workers

Getty Images

Welder

Brian Papke is frustrated.

As president of Mazak Corporation in Florence, Ky., he is struggling to hire welders. In fact, Mazak has openings for 20 welders needed to help build precision metal cutting machines that will be sold to large manufacturers around the world.

But, after months of being unable to find applicants with the welding skills needed, Mazak is doing something rarely seen with blue collar jobs, it's offering a signing bonus.

Papke calls it a $2,500 bounty Mazak will gladly pay to welders it hires. "We have to move quickly," said Papke. "Offering bounties was one of the fastest ways we could go to attract people into our welding programs."

Strange as it may sound, America's manufacturing companies are struggling to find enough qualified workers. In fact. over the last two years the number of manufacturing job openings in the U.S. has more than doubled.

According to the Bureau of Labor Statistics, there were 264,000 job openings in the manufacturing sector at the end of last year, compared with approximately 100,000 two years ago.

Even with the abundance of openings, companies have to go further than ever to find the right person to put on the factory floor. Seco Tools in Troy, Mich., has 11 job openings, with some paying up to $90,000 annually. It is now offering to pay up to $4,000 for the continuing education of people it hires.

OMAX corporation in Kent, Wash., is offering current employees referral bonuses of several hundred dollars if they can bring in someone OMAX hires. The jobs pay between $35,000 and $50,000.

Still, OMAX, which builds water jet metal cutting machines, has 13 job openings it's unable to fill.

"Yes, I am a little bit frustrated," Say Dr. John Cheung, the founder and president of OMAX. "But on the other hand we recognize that this lack of skilled labor is the result of 20, 30 years of shifting demography, demographics and shifting attitude and we cannot turn that around overnight."

The problem is America's factories have become more complex and now require workers with more skills than in the past.

Typically, workers need computer, math and analytical abilities to operate sophisticated machinery. That reality may run counter to how many Americans look at blue collar jobs. Gone are the days when factory floors were dark, dirty, and inefficient.

"I think there is an opportunity and a disconnect that is occurring right now in our economy," says Papke.

The surge in American manufacturing jobs is due to a confluence of factors. The recession forced many companies to defer orders for new equipment. As the economy has rebounded, so have factory orders.

At the same time, the relatively cheap dollar has made it more profitable for companies to build and ship products out of the U.S. Finally, American factories have the ability to do more sophisticated manufacturing with a well paid, skilled work force.

And as orders have skyrocketed, so has the overtime many blue collar workers are putting in. Just ask Jeffrey Watkins, OMAX machine shop supervisor.

"We are working two full shifts here five and six days a week. Occasionally we will even work on a Sunday to keep up with the business we have going on right now," says Watkins.

Many CEOs say they believe America's manufacturing boom could continue for several quarters. But as they grow sales and orders, they will need to hire more workers. Given the unemployment rate in the U.S., you'd think finding people fill positions in plants would be relatively easy. The facts paint a different picture.

Marty Moore, who works on the line at Mazak, summed it up best. "When they say that manufacturing is down around the country it’s hard to believe that, being as busy as we are."

Email us at [e-mail]
Follow us on Twitter @SmallBizCNBC