Labour still a top challenge for manufacturers

As rising interest rates, poor economic conditions, and an ongoing talent shortage continue to plague manufacturers, optimism amongst industry leaders remains low, says a report from Sikich, a data company. The report says roughly half of manufacturers (57%) rate their optimism about business prospects over the next six months at a seven or lower on a scale of one to 10. This is similar to the same time last year. Compounding their challenges, manufacturers have had to increase wages to meet labour needs and support employees through an economic slump. More than half (53%) of manufacturers have increased wages by 5% to 8% in the past 12 months, and nearly one-quarter (22%) have increased wages by 9% or more. Thirty-six percent of manufacturers report that wage increases over the past 12 months are significantly higher than increases over the past five years. On a positive note, nearly half of manufacturers (43%) report consistent or increased customer demand and 34% note improvements to the supply chain. In comparison, in October 2022, 43% of manufacturers reported supply chain issues.