4 rules for retaining contingent workers in manufacturing

Manufacturers traditionally rely on flex workers more than most other industries because of the need for agility and flexibility. So with talent scarcity a concern for many companies, product makers are significantly affected by the rising demand for talent. If you are operating manufacturing facilities, you likely have encountered these difficulties.

Employers have been especially pressed by growing competition for temporary workers as more companies now utilize non-permanent resources to execute mission-critical functions. In addition, the growth of gig employment has siphoned many to become their own bosses. So for manufacturers facing talent scarcity, retaining their existing temp workforce is a top priority.

The challenge, however, is that blue collar, flexible talent employed in the manufacturing sector is easily swayed to change jobs. The biggest factor is wage competition since even a small raise can lead workers to switch employers. Furthermore, because contingent manufacturing workers have more work options today – through the human cloud, for example –  they typically choose companies that offer greater scheduling flexibility, the possibility for permanent employment, work that fits their skills and interests and greater future earning potential.

Complicating all of this is the fact that manufacturing continues to undergo tremendous change, driven by greater adoption of artificial intelligence and automation. As this occurs, many manufacturing workers will need reskilling, according to Industry Week. Companies must invest in training and development for both permanent and contingent talent to ensure they have an engaged and prepared workforce for tomorrow’s manufacturing lines.

As competition for contingent talent grows and concerns about automation detering workers from seeking employment on the production floor prevail, how can manufacturers attract and retain the resources they need to support growth? Just as important, how can they avoid using compensation alone as an incentive to keep their production lines properly staffed?

4 considerations for retention

Due to the transient nature of contingent jobs, the factors that motivate workers who choose this kind of employment differ somewhat from what motivates permanent employees. It may be a need for flexible or limited hours. Some want to move from assignment to assignment or look to fill their available time from several employers. Then there are those who lack the skills or training needed for permanent roles. Whatever the reason, as a manufacturer you should understand the needs of your contingent workforce to better retain these important resources. Consider the following four baselines for addressing their preferences.

1. Compensation fit

As stated earlier, many contingent workers in the manufacturing industry may switch jobs when offered even a small raise. It’s not surprising that turnover among U.S. manufacturer is high (43% report at least 20% in annual turnover, according to one survey). The most attractive compensation for contingent workers, however, may not always be the highest hourly or day rate.

Wages alone may not motivate a worker to stay with a company. In some markets, healthcare benefits for part-time or contingent talent can have strong appeal to those without coverage on their own. Google recently began requiring its staffing agencies and suppliers to provide healthcare in addition to other benefits to contingent workers as a way to bring parity to its workforce. Its actions specifically address the needs voiced by its non-permanent workers.

Whether your company can afford to provide or mandate suppliers to offer these types of compensation should be carefully assessed. More importantly, can you offer flexible wage arrangements that tend to the needs of workers who may want to work only overnights or other times when rates are higher. And as always, make sure to regularly check that your wages are competitive with prevailing market rates. 

2. Job fit

Employees sometimes leave a job after just a brief tenure because of a poor job fit. How does this happen? The worker may be overqualified or underqualified, which could leave him or her unengaged and at risk of quitting. This could be the result of an inaccurate job description or misrepresentation during the recruitment process. Or the work simply doesn’t fit the expectations of the worker or his schedule.

Ensuring the worker fits the requirements of the job – and the job fits the requirements of the worker – should be a priority when filling a flexible role. Whether the candidate is supplied through an agency or filled sourced by the employer, a proper job fit will be critical to retaining the best talent. Even with a strong compensation package, organizations risk losing if workers are completely dissatisfied with their work.

To avoid such a scenario, set the right expectations when hiring. Make sure job previews accurately depict the work and be truthful about the company’s culture, policies and work life for contingent talent. By being transparent, your company’s hire will more likely be retained rather than bolt at the first sign of dissatisfaction.

3. Professional development

According to the study cited in Industry Week, 29% of manufacturing employees believe their skill set is redundant now or will be in the next 1 to 2 years, and 38% believe this will be the case in the next 4 to 5 years. This outlook results in tremendous uncertainty for workers, who may feel pressured to look for employment in other sectors. As they leave, they may take important skills that may still be relevant and needed in manufacturing.

Even though they tend to be more transient than permanent employees, contingent talent still want employers to provide training and development support. According to one survey, the majority of manufacturers are not upskilling or investing in continued education to support retention. Most companies also don’t have in place a talent development strategy for manufacturing employees.

By ensuring you do offer training and reskilling to temp workers, you keep them more engaged and prepared for changes in your business. While you might worry that non-permanent workers will simply take their knowledge elsewhere once they are trained, as long as you offer competitive compensation you are likely to retain them.

4. The talent experience

Finally, providing a satisfying talent experience for candidates or employees will enhance retention. If you already deliver an excellent workplace culture to employees, you should do the same for flexible talent. The most important consideration is to provide personalized attention to talent, thereby enhancing the hiring journey. Doing so elevates worker loyalty and improves retention over time. It may also help reduce costs if workers attach a value to the extra attention they receive from your organization.

This should start with regular communications to facilitate engagement. By keeping workers and candidates informed about your business, they will more likely take part in efforts to support your company’s future. Furthermore, their positive experience will be shared with their network, creating even more interest in your business.

You can raise engagement by scheduling regular communications with all workers, regardless of work arrangements. Furthermore, seeking their feedback helps to create a two-way conversation. Make sure to provide coaching and other developmental programs so your contingent workers develop trust and confidence that you’ll be looking out for their best interests. The end goal is to always deliver a positive experience that will compel workers to remain loyal to your organization in the face of competing offers.