There are two things that keep me up at night--and I don’t know which is going to happen first. The first is the retiring of the baby-boom generation. Currently, manufacturers are seeing a tremendous skills gap shortage. Manufacturing talent is not coming into the labor force as quickly as jobs are being created. To compound this, the current labor force is older and, when the baby boom generation starts to retire, I see our skilled labor shortages becoming a crisis.
The second thing is, I feel we may get hit by another recession. Although the unemployment rate has gone down, the average household income has remained stagnant; families are not seeing their wages rise. That stagnation is not the case in U.S. manufacturing because, where there is a shortage of skilled labor, simple supply and demand will tell you wages must increase to attract talent.
However, we are seeing skilled labor move from one plant to the next, instead of new skilled labor being created. Rising wages will hopefully attract more people into our industry. Unfortunately, we cannot say the same for the rest of the U.S. economy, which concerns me. Couple that with interest rates that have not gone up since 2009, and you will see the signs that sooner or later a recession is bound to happen.