Manufacturing Sector Faces Knowledge Drain as Workforce Retires
The manufacturing industry is confronting a growing knowledge gap as a significant portion of its workforce retires or leaves. Research indicates that few companies are effectively capturing expertise from departing employees.
The manufacturing sector is experiencing a significant knowledge crisis as a large percentage of its workforce approaches retirement or transitions out of their roles. According to new research by APQC in partnership with eGain Corporation, companies estimate that an average of 51% of their workforce will leave within the next five years, leading to a substantial loss of institutional knowledge.
Despite widespread recognition of the issue, with 85% of C-suite leaders and 81% of business unit leaders identifying knowledge loss as a concern, action remains limited. Only 30% of organizations consistently capture knowledge from departing employees, while a notable 41% rarely or never attempt to do so.
The consequences of this inaction are substantial. Critical information regarding equipment maintenance, production processes, and quality standards, often held by experienced personnel or scattered across disparate systems, can be lost. This can lead to production slowdowns, inconsistent quality, increased compliance risks, and extended onboarding times for new hires, impacting overall workforce agility and customer satisfaction.
Reasons cited for the failure to capture knowledge include lack of time (52%), insufficient resources (45%), it not being a priority (38%), and an unsupportive culture (35%). The study also highlights a significant interest in Artificial Intelligence (AI) for knowledge capture, with 79% of organizations expressing interest in leveraging the technology, presenting an opportunity for those who adopt it.