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Diversity in the digital workforce can help in war for talent, says expert

Manufacturers that concentrate their efforts on cultivating a diverse and inclusive workforce will be best placed to combat the digital skills challenge they face, an expert has said.

Employment law expert Rob Childe of Pinsent Masons said there was currently a war for talent for digitally-focused roles in the manufacturing sector, with an increased need for technology specialists and growing competition with other sectors posing challenges.

Childe said manufacturers recognising that there was demand for digital, technical, social and emotional skills, and fostering a more diverse workforce would help meet that demand. 

Consulting firm McKinsey recently released a research report focusing on talent challenges and opportunities (17 page / 961KB PDF) in the defence and aerospace sector, which noted that their talent strategies and human resource capabilities had not kept pace with their needs or the realities of the current market.

The report highlighted a need for increased technology capability as automation grows in aerospace and defence, but said the sector had failed to keep pace with start-ups in related sectors such as space when it came to developing skills. There was an external and internal perception that companies were stifled by bureaucracy, and had failed to develop diversity and inclusion initiatives.

A survey of 100 German manufacturers and German students carried out recently by Pinsent Masons produced a similar finding, with only 42% of companies saying they were prepared to keep pace with the next wave of digitisation, while 76% of students said it was important that their prospective employers were at the cutting edge of technology. 

McKinsey said the aerospace and defence workforce tended to be older and to have been in the workforce for longer than in adjacent industries. This also created an image challenge for this sector.

Diversity initiatives were ‘traditional’ and lacked ownership and prioritisation to make them effective, McKinsey said. In addition, a lack of women and people of colour in leadership made potential candidates in these groups question whether they could thrive.

The report said it was important for organisations to prioritise diversity and inclusion, even in the recovery from the Covid-19 pandemic when the focus might be elsewhere.

McKinsey data showed that organisations in the top quartile for ethnically diverse executive teams were 33% more likely to outperform their peers on earnings before interest and taxes, while gender-diverse executive teams were 27% more likely to outperform their peers in long-term value creation and 21% more likely to have above-average profitability.

The report suggested leaders’ performance reviews could be linked to diversity outcomes to ensure they were motivated and held accountable. Organisations could increase representation of diverse employees by developing partnerships with universities and colleges and leverage remote work to broaden the recruiting pool.

Revamping hiring practices to remove potential bias, and tracking promotions and attrition of women and minorities, could also make the workforce more diverse.

Childe said: “There is clear evidence that manufacturers can steal a march on the war on talent by actively focussing on attracting, recruiting, retaining and developing a more diverse talent base. As is evident from the McKinsey research, manufacturers will not only attract the right people and skills they need to thrive in the fourth industrial revolution, but will at the same time have the opportunity to reap the wider economic rewards that come with a more diverse workforce.”

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