Blue-collar sector labors to reach new workforce
With the number of manufacturing jobs in Connecticut down in five of the eight months so far this year, an easy prediction by economists is coming to pass: The wave of baby boomer retirements has hit.
And despite increased efforts by colleges and vocational schools to train new manufacturing workers, available jobs still outpace qualified employees. Some manufacturers, desperate for workers, are keeping older workers on the job long after the usual retirement age.
“The retirement onslaught as we predicted is actually happening,” said Patrick Flaherty, an economist at the state
Department of Labor. “We’ve been talking about this for quite a number of years. You don’t have to be a genius. Just look at the age profile.”
The Department of Labor reported this month that manufacturing employment in August stood at 160,900 jobs, down by 200 from July. It was the second consecutive drop, which does not make a trend. However, the sector has struggled to boost its ranks in Connecticut, adding just 100 jobs so far in 2019.
The number of manufacturing jobs has been rising slowly over the past few years, but it’s down significantly from the 1990s and mid-2000s. The Great Recession, offshoring of production, avoidance of manufacturing by youngsters and other factors have taken their toll.
“We had decades of decline,” Flaherty said. “Their parents were telling them, ‘Don’t go into manufacturing because of layoffs and downsizing.’ A re-education needs to be done.”
Over the last 20 years, the percentage of older workers has surged as the baby boom generation has aged, according to the U.S. Census Bureau, with 27% of Connecticut’s workforce now over 54. For manufacturing, 35% of the workforce is over 54. The median age in Connecticut is nearly 41, which ranks the state as one of the oldest.
Recently, manufacturing has been a bright spot in Connecticut’s slow-growth economy. The state is home to three Pentagon contractors — jet engine maker Pratt & Whitney, submarine manufacturer General Dynamics Electric Boat and Lockheed Martin Corp.’s helicopter maker Sikorsky — and hundreds of small, often family-owned machine shops and manufacturers that form an extensive supply chain.
All are benefiting from big increases in defense spending. Electric Boat is hiring to produce three submarines a year, Sikorsky is making heavy-lift helicopters and Pratt & Whitney builds engines for the F-35 jet fighter. In addition, the subsidiary of United Technologies Corp. and its suppliers are working through a backlog of engines for commercial airlines.
Lockheed Martin said it’s looking to hire 50,000 employees over the next 15 years globally. In Connecticut, it’s partnering with high schools to fill manufacturing, engineering and computer science jobs. It also recruits at universities, sponsoring senior design projects at the University of Connecticut and University of New Haven for mentoring between employees and students.
John Beauregard, president of the Eastern Connecticut Workforce Investment Board, said smaller and mid-sized companies offer incentives, such as adjusting work schedules, to keep employees approaching retirement from leaving until the supply of workers is “up to snuff.”
Jamison Scott, executive director of the New Haven Manufacturers Association, said manufacturers are holding on to workers long past retirement age. As many as five generations are on the job, with employees ranging in age from their 20s to 80s, he said.
“It’s a multigenerational workforce,” he said. “People are coming out of retirement. Retirement isn’t for everybody.”
A slowing economy and a trade dispute between China and Trump resulting in punishing tariffs are adding pressures to the manufacturing sector. Economists, who rarely agree in their predictions, are split on the outlook for manufacturing. Moody’s Investor Service last week revised to negative its outlook for the sector based on lower earnings. It sees no growth this year and flat to about 1% growth in 2020.
Still, Moody’s said the aerospace and defense sector, Connecticut’s dominant manufacturing business, is expected to generate strong growth, led by defense spending and commercial aircraft orders.
Elsewhere, trade troubles “and the widening scope of tariffs” will likely have a significant and negative impact on corporate earnings, Moody’s said.
The same day, the Federal Reserve said industrial production rose 0.6% in August after declining 0.1% in July. Manufacturing production increased 0.5%, more than reversing its decrease in July, the central bank said. Factory output, too, has increased in the past four months after falling in the first four months of the year, it said.
Eric Brown, a Connecticut Business & Industry Association lobbyist who focuses on manufacturing, said manufacturers are optimistic. “I think, overall, the picture is very strong,” he said.
“There is very little talk about significant concerns about a slowdown,” Brown said. “Anumber of manufacturers keep hearing about an economic slowdown. They’re not seeing it.”
Craig Bond, president of Abbott Ball Co., an industrial ball maker in West Hartford, said business is mixed.
“The automotive side is definitely weakening, even before the GM strike,” he said. “The defense stuff is really busy.”
“Aerospace is not bad,” Bond said. “I don’t think it’s growing, but it’s strong.”
Two sectors that are slowing are heavy equipment and the cosmetic industry, which Abbott Ball supplies with agitator balls.
And Jamison Scott, executive director of the New Haven Manufacturers Association, said the outlook on manufacturing “depends on who you ask.”
“There is softening for some manufacturers in the state while others are booming,” he said, citing aerospace and defense that are “looking good,” particularly Electric Boat and its suppliers that provide longterm job opportunities.
Scott, who is executive vice president of Air Handling Systems, a Woodbridge manufacturer of duct work for industry, said his business has been “off just a little since last year.”
“However, the last two weeks we have been absolutely jamming, making up the entire difference over the last nine months,” he said in an email. “I wish it would last. But the reality of today’s manufacturing for many of us is the swings are the new norm.”