Industry 4.0: manufacturers should sell the benefits of a manufacturing career

Out-Law Analysis | 15 Oct 2020 | 10:56 am | 5 min. read

Executives in the industrial manufacturing sector face a series of existential threats. On the one hand, long-term trends such as the transition to Industry 4.0 and the climate emergency require transformational thinking about how to future-proof business operations.

On the other hand, short-term shocks such as Covid-19 and Brexit have hit the manufacturing sector hard. These unexpected crises require fast decision-making and creative solutions to maintain financial and operational resilience.

One constant throughout this turmoil has been people and talent. For decades industrial manufacturers have been able to rely on a stable and committed workforce, equipped with the right skills to adapt to change. Workforce stability is predicated on being able to attract and retain a pipeline of talent that begins with school leavers, apprentices, and entry level roles.

Earlier this year, prior to the onset of Covid -19, Pinsent Masons, the law firm behind Out-Law, asked 100 leading industrial manufacturers in Germany about their talent management priorities, and 100 young people currently in education about their career aspirations. The results show attitudes towards apprenticeships are noticeably shifting.

The research busts a commonly held myth: that apprenticeships will underpin the future success of the German manufacturing industry. Instead, manufacturers are finding it increasingly difficult to attract and retain apprentices, and young people find apprenticeships a less attractive career option compared with other options available to them.

For example, fewer than two-thirds (59%) of the HR and talent leaders surveyed believe that apprenticeships now provide young people with the same opportunity to pursue a rewarding career as a university degree.

Attracting and retaining apprentices: a hidden challenge?

Germany’s apprenticeship system has long been touted as a global success story. According to figures released by Germany’s Federal Statistical Office, more than half a million people (521,900) completed an apprenticeship contract in 2018, an increase of just over 1% on the previous year.

This engagement with apprenticeships compares favourably to other leading economies. In the same period in England, for example, House of Commons Library research shows that apprenticeship completions were little more than a third of the level of Germany (185,100). In the US the number was even lower, with just 81,000 people completing a formal apprenticeship programme over the same period.

On the surface it appears that the numbers of apprenticeships in Germany remain buoyant. However, the experience of leaders within the industrial manufacturing sector in Germany shows that the German manufacturing industry is also facing challenges.

Over half (59%) of the HR and talent leaders surveyed said they struggle to fill apprenticeship positions because too few people are interested in taking up these opportunities. More than a third (36%) cite this as a major problem for their business.

Encouraging young people to apply for apprenticeships is not the only challenge faced by employers: retention of apprentices is a significant issue too. Nearly three-quarters (72%) of employers surveyed said they had experienced – at least before the Covid-19 crisis – a high drop-out rate among apprentices caused by inaccurate expectations about the role.

What does the younger generation think?

There are diverging expectations between the new generation entering the workforce and employers in the manufacturing sector. Young people said they prioritise a healthy work-life balance, flexible working, and the ability to work with advanced technology when assessing their employment options.

This attitude is reflected in how young people evaluate their choices when leaving school. More than half (55%) plan to continue their studies at university or a further education institution. Just 10% of those students surveyed plan to pursue the apprenticeship route and even direct employment is more popular than apprenticeships among German students.

Kathrin Bruegger

Kathrin Brügger

Rechtsanwältin, Partner

Workforce stability is predicated on being able to attract and retain a pipeline of talent that begins with school leavers, apprentices, and entry level roles.

A similar picture emerged in a 2018 Pinsent Masons report about the aspirations of British students. In that research just 9% of the British students surveyed said they were interested in taking up an apprenticeship role in future.

Failing to meet expectations for diversity and inclusion

Diversity and inclusion are also high on the agenda for the new generation entering the workplace today. For example, 48% of the young people interviewed said it was either “indispensable” or “very important” that the company they choose to work for has a diverse leadership. An even higher proportion – 64% – said it was “indispensable” or “very important” that their employer was openly supportive of LGBT+ people.

It is worrying therefore that data from Germany’s Federal Statistical Office shows that the number of apprenticeships completed by women contracted by 1% in 2019. This reflects a long-term trend: the proportion of women opting for vocational training in Germany is down 25% over 10 years.

As the apprenticeship route becomes less diverse, employers are potentially missing out on the harnessing skills of under-represented groups.

Benefits and relevance of industrial manufacturing

To encourage more young people to consider a career in manufacturing it is important that employers actively sell the benefits of working in the sector. Employers need to encourage young people to see that industrial manufacturing is a viable and relevant option for them regardless of their background. How manufacturers communicate this to the next generation matters: 68% of the young people surveyed said it was very important that they regularly see images of people like them doing manufacturing work.

When young people were asked what would build their interest in working in the manufacturing sector, a majority said they would be open to gaining hands-on experience within the sector either through work experience (78%) or open days (75%).

Willems Lara-Christina July_2019

Lara-Christina Willems

Rechtsanwältin, Fachanwältin für Arbeitsrecht, Certified Lawyer for Employment Law

As the apprenticeship route becomes less diverse, employers are potentially missing out on the harnessing skills of under-represented groups.

Employers that do not take advantage of social media platforms to show what a career in manufacturing looks like in practice are missing a clear opportunity because more than half (59%) of the young people surveyed said they would be interested to find out more this way. Leading German manufacturers such as BMW and Bayer have already built a large following of 36,000 and 13,000 followers on their Instagram careers pages respectively.

Developing your apprenticeship strategy

The research suggests that without positive intervention, the apprenticeship option may become more difficult for industrial manufacturers to sustain over the long-term. They need to be bolder in selling the benefits of a career in their sector. Here are three actions that HR and talent professionals should consider:

  • Help young people to understand what a future career in manufacturing would look like, and how an apprenticeship will offer them the flexible learning experience they are looking for from their career. Telling stories and illustrating experiences via social media channels can be an effective way to engage directly with this audience.
  • Future workers say it is important that the companies they work for actively promote diversity and inclusion, and that they showcase a diverse leadership. Ensure that your communication strategies for school leavers and entry-level roles promote diversity and inclusion credentials and show clear progression opportunities for apprentices.
  • Both the young people and the employers we surveyed believe that government needs to play a greater role in equipping future generations with the skills to succeed in manufacturing. Making long-term change requires industry leaders to actively engage in shaping education and development opportunities for future generations.