DETROIT — Brian Griffin is like a lot of people in the auto supply chain looking for engineers these days: He’s searching for new ways to find talent.
The vice president of human resources at Cooper-Standard Automotive, which supplies sealing and anti-vibration systems to automakers around the world, says the industry is unprepared after it downsized at the start of the Great Recession.
“There were engineers in the market all over the place, and we did no college recruiting and could fill all of our jobs with ease,” Griffin said.
Now employers can’t afford to be picky, he said, so Cooper-Standard restructured itself to fill more jobs with young engineers. Griffin said the company can fill about half of its engineering positions with experienced workers and has increased college recruiting to fill the rest with recent graduates in a “grow our own approach.”
“We just can’t do it all through the college recruiting,” Griffin said, adding that some engineering positions are suitable for new graduates, but others require more experience.
Cooper-Standard, with more than $3.3 billion in estimated annual revenue, is just one example.
Staffing company Kelly Services fills thousands of auto industry jobs every day, placing an engineer nearly every 30 seconds, said Al Sowers, Kelly Services’ vice president of U.S. operations.
The increasing stream of engineering openings underscores the need for the auto industry to attract and invest in younger workers — and not just engineers.
The U.S. is expected to produce 12.2 million vehicles in 2016, up from 11.1 million in 2013, according to the Center for Automotive Research in Ann Arbor, Mich.
Likewise, the auto industry’s manufacturing work force has been on the rise. The U.S. Bureau of Labor Statistics estimates the industry’s manufacturing sector employs about 937,500 workers. That is 126,500 more than three years ago and 222,900 more than in 2011.
But with CAR estimating U.S. auto production of 12.5 million vehicles in 2018, low U.S. unemployment and labor participation rates mean suppliers and manufacturers will have to cover their bases in the skilled trades and entry-level departments, too.
Engineers are in high demand by auto suppliers and manufacturers, which are fighting harder than ever to fill positions to match advancing vehicle technology and manufacturing processes.
Since 2014, auto suppliers’ most-advertised U.S. auto manufacturing job has been computer systems software engineer, according to global job site aggregator Indeed.com. The position remained on top while its number of postings rose 84 percent from 2014 to 378 postings on June 31, 2016.
Computer systems software engineers also top the list for automakers this year. Data from the Detroit 3 through June showed the same four engineering positions among the five most-advertised positions since 2014 on Indeed: mechanical engineers, software quality assurance engineers and computer application and systems software engineers.
Indeed pulled its data from the Detroit 3 and the top 10 suppliers on Automotive News’ list of the top 100 global suppliers.
From January to June, global job site Monster Worldwide Inc. compiled a similar list. Its most-advertised U.S. auto manufacturing job: industrial engineer. The position had an average posting length of 49 days. The second most-advertised job was mechanical engineer with a 46-day posting, which doesn’t necessarily mean the job was filled when removed. Monster’s top jobs trended toward engineers and leadership positions such as production and operating supervisors.
But Monster also posted an overall decrease of 3 percent in auto manufacturing postings from January to June, the first such drop for the first half of a year since Monster started tracking the numbers in July 2012.
Grads, apprentices welcome
For companies such as Cooper-Standard that are eyeing college students, there may be some problems. The auto industry isn’t exactly the destination favored by college graduates, said Tom Lehner, vice president of public policy at the Motor & Equipment Manufacturers Association. The association represents original equipment and aftermarket auto suppliers across the U.S.
Lehner said some MEMA members say hiring and retaining a strong work force over the past couple of years has been an “ongoing challenge.”
A large reason for this, Lehner said, is because “technology jobs” are taught or emphasized as computer work, not as vehicle technology or manufacturing techniques. So as the labor pool shrinks, he said, those newly available graduates take their skills to places such as Silicon Valley.
“One of the reasons, quite frankly, suppliers and auto companies have opened offices in Silicon Valley is so they’re closer to some of the skill sets out there,” Lehner said. “And given how much innovation has taken place in the [automotive] industry, it’s a convenient marriage, if you will, of technology talent and taking advantage of innovation.”
Still, demand remains heavy where suppliers are clustered — near assembly plants in Detroit, Ohio, Indiana and the Southeast, he said.
Cooper-Standard’s Griffin said that demand extends further into a skilled-trades search, noting that companies need to invest, not only in college graduates, but in apprenticeship programs so young people can start filling important skilled-trades positions.
It seems the available number of employees is dwindling at every level, but it’s really nothing new, said Kristin Dziczek, the director of industry, labor and economics at the Center for Automotive Research.
Labor participation in the auto industry, and in general, has been declining for years thanks to retiring baby boomers. In July, participation in the U.S. was 62.8 percent, compared with 66.1 percent 10 years ago, according to the Bureau of Labor Statistics.
“The next generation is not going to replace the labor force participation,” Dziczek said. “Nothing compares to the boomers. So when they leave, changes will have to be made.”
There’s more trouble as the U.S. unemployment rate remained at a low 4.9 percent in July. Now labor challenges extend into entry-level work, which hasn’t received a lift for some time, Dziczek said.
“For manufacturing and supplier jobs, the inflation-adjusted wage has fallen 25 percent in the last five or six years,” Dziczek said. “There are more options in other sectors that pay similarly to entry-level manufacturing jobs.”
The lack of autonomy working on an assembly line, for example, plus poor pay means people, especially younger workers, often go elsewhere for work, Dziczek said. Unskilled blue collar work in the auto industry used to be desirable, offering solid wages, competitive benefits and protection from layoffs, but that “has been chipped away,” she said.
Indeed’s website is loaded with jobs for automotive engineers, particularly in software.
Prepared to ‘adapt’
Dziczek noted some advancement, such as last year’s contracts between the UAW and the Detroit 3. The contracts eliminated the two-tier pay system, allowing entry-level workers higher pay, but it didn’t touch pensions or other seniority issues. And what the Detroit 3 decides, Dziczek said, can set a precedent for suppliers.
Kelly Services’ Sowers said the key to hiring and retaining employees will be for companies to engage workers and allow them to work their way up.
“We’re not predicting a huge influx of talent or labor,” Sowers said. “We as an organization at Kelly, we’re forecasting the next 10 to 15 years to be a tight labor market.”
As automakers, suppliers and research experts decide which course of action is best for assembling a work force, Cooper-Standard’s Griffin said one thing is certain: The industry will readjust, as it always does.
“I think we’re holding our own, and I think most of us are looking out there and are anticipating that it’s probably as challenging now as it’s going to be,” Griffin said. “If this is just our new normal, we’ll adapt and be OK and we don’t want to be too far ahead of ourselves.”