This article appeared in the Mar/Apr 2024 issue of MiMfg Magazine. Read the full issue and find past issues online.

The post-Covid-19 workplace has become a revolving door for most manufacturing plants — especially those in the automotive industry. Workforce data indicates that the manufacturing sector’s turn-over rate is 40 percent. The main reasons cited for “dissatisfaction” are the lack of a “people focused” leadership mindset and skill set that meets the needs and values of employees — especially plant-level supervisors, team leads and operators.

The financial cost of turnover has resulted in this being cited as a main priority for 2024. The good news is many plants have begun to seriously look at solutions other than raising wages — which hasn’t been working. Some of these strategies have cut turnover rates in half while saving millions in replacing lost employees — costs for recruiting, selecting, onboarding, training, etc. According to MIT’s Sloan School of Management, the salary plus benefits usually totals “in the 1.25 to 1.4 times base salary range.” 

Instead of continuing to engage in wage wars and accepting the high cost of replacing employees — invest in people with these proven solutions:

1. Develop the people leadership skills of front line leaders in the plants: production managers, supervisors, team leads. Many leaders/managers in these positions are typically competent in running operations but lacking in basic people leadership/management skills: communication/listening, conflict resolution, motivation, feedback, multi-generational challenges, change management
2. Examine current HR policies and practices, including training and development in leadership behaviors and skills.
3. Evaluate the plant culture. Is it still in the dark ages of command and control, top down/non-inclusive culture, “do as I say, not as I do.” Or has it evolved into a coaching culture that achieve results by leading and developing leaders to get results through people.
4. Be serious about exit interviews and employee satisfaction surveys. Don’t ignore the number complaint — poor leadership. Research consistently confirms that the number one reason for employee turnover is their manager.
5. Recognize high performing and high potential employees at all levels and develop a career path for them — a way for them to achieve their life’s priorities at your plant.
6. Acknowledge that being successful in today’s environment is very challenging whether your challenge is domestic or foreign competitors, regional labor shortages, or union problem, etc. Know when to seek the help of organizational development specialists — they can save you a lot of money and headaches in the long run.

As you consider these various options for improving retention, remember to start by identifying what your employees want and value. There is not a one size fits all but investing in your people can hopefully help with your retention needs.

About the Author

Dixie Grow is the President of Career Growth, a certified women-owned business. She may be reached at dixiegrow@careergrowth.com.

Career Growth is an MMA Premium Associate Member and has been an MMA member company since December 2023. Visit online: careergrowth.com.