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The Importance of Labor Analytics in Locating a Manufacturing Facility

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he availability of labor is a critical, if not the most critical, decision-making factor in the expansion, relocation, or development of a new manufacturing facility.  A comprehensive evaluation of the workforce availability, quality, and cost in any given market and the programs in place to train and support a future manufacturing workforce in the targeted area must be diligently completed prior to any site decision.

According to the National Association of Manufacturers (NAM), manufacturing continues to be a significant force in the United States, contributing $2.33 trillion to the economy in the first quarter of 2018.  To support this impact, the NAM predicts that over the next decade, nearly 3.5 million manufacturing jobs will be needed and 2 million are expected to go unfilled due to the skills gap (http://www.nam.org/Newsroom/Top-20-Facts-About-Manufacturing/).

This forecasted industry growth reinforces the necessity to carefully analyze up-to-date labor analytics prior to any location decision. A detailed review of the specific employment needs of the manufacturing segment is necessary.  Some manufacturing positions are more labor intensive and some more knowledge intensive.  This teamed with unique production factors help define where the facilities are ultimately developed.  Labor intensive segments, typically, follow a more wage driven path, but other segments will weigh more heavily on employee skills.  Details on job classifications, wages, as well as available programming and governmental policies supporting education and skills development are some of the factors involved in a full labor analysis.

Once an examination of the specific needs of a manufacturing expansion, relocation or new facility project is completed, significant data is assembled for through investigation and analysis for each prospective state and local community.  The data is then weighted according to the industry segment’s most critical needs.  Examples of vital labor data to be gathered includes:

  • Labor force educational attainment
  • Labor costs
  • Real-time human capital supply
  • Labor demand
  • Educational opportunities
  • Concentration of human capital by job category
  • Demographics

With the labor market currently considered at full employment, it is more important than ever to make informed site decisions providing the right labor pool now and a workforce pipeline for the future.  Uncovering that data and intelligence can point a manufacturer to the right site decision.

When choosing an expert to assist and advise in site selection, it is important to look for full-time dedicated analysts, with the ability to sharpen in on demographics and critical key factors.  Ginovus has a department of expert analysts dedicated to focusing on the most current and detailed data available, while applying decades of experience to the understanding and communication of what that data means to our clients.