Why communication, compensation, and innovation can boost morale and your bottom line
The manufacturing industry is a vital one in our economy today, producing the goods and services that fill the world’s shelves and keep its engines turning. Within manufacturing companies, frontline factory workers play an essential role in overseeing the processes that help ensure products are made accurately, quickly, and efficiently.
For the 2024 "Voice of the Essential Manufacturing Worker" report, we surveyed 600 frontline factory workers, revealing their daily successes, challenges, and expectations. These insights allow us to understand where they are today, what's changed, and what's stayed the same, compared to last year's report.
Here's what we learned:
Implementing new technologies and evolving processes requires staff to acquire new skills to run those technologies. 70% of those we surveyed say that their companies are making upskilling a priority to help ensure their workers have the knowledge and training needed for continued future growth. Top upskilling initiatives include giving workers on-site and on-the-job training, offering access to online learning platforms, and covering tuition for courses and training.
Despite these efforts from many businesses, this number represents a 10% drop from last year, when 80% of frontline workers said their company was prioritizing upskilling. Companies with leaner budgets this year may have had to cut or limit upskilling initiatives to save money.
The biggest challenge factory workers face today—and their biggest challenge last year—is the rising cost of raw materials. When asked how frontline workers could be impacted by the rising cost of raw materials, respondents had two top answers: "It leads to tighter budgets, affecting my ability to access resources needed for my job," and "There is increased stress due to the potential for job insecurity if the company can't sustain the costs."
High morale is a key factor in retaining workers who are engaged, who feel positive about coming to work, who enjoy their work, and who want to contribute. However, fewer than half (45%) of respondents say morale is high at their company—a dip from 52% who felt that way last year.
Reasons for dropping morale include the lack of pay raises or bonuses, management that doesn't respect work time, high turnover, unrealistic expectations for workers, and management that doesn't listen to feedback.
However, those who say morale is high at their company attribute it to bonuses or better pay and flexible work schedules, two factors that were on the list last year. This year, workers also attribute high morale to management that listens to staff.
What can manufacturing leaders do to create a better work environment? Frontline factory workers say it starts by listening to staff, a response that rose from fourth-ranked last year to first this year. Listening to staff means being open to genuinely receiving feedback about their tasks, their safety concerns, their suggestions for improvement, and their requests for better tools or more training.
The challenges caused by lack of listening is reflected in other survey answers as well, including workers’ statements that their supervisors have poor communication, management doesn't respect work time, and that frontline employees have too many unrealistic expectations placed upon them.
Other ways management can create a better workplace include offering more paid time off, offering flexible work schedules with flexible start and end times, and providing better tools and technology.
Manufacturing companies who want to keep up with the competition and position themselves for future growth know they need to modernize both their technology and their processes. This could be through digital transformation, cloud adoption, automation, AI, and other initiatives. Yet despite this acknowledgement, only 39% see their company as "very modern"—a drop from 48% who viewed their company as "very modern" last year.
What has changed? Likely factory worker perceptions, for starters. Every day, all around them, they interact with new technologies: using digital documents and the cloud in their personal life, playing around with AI on social media, and connecting with companies through personalized digital apps. If their company can’t mirror or surpass the technology they see all around them every day, workers will feel like they're stepping back in time when they clock in.
While the numbers decreased slightly from last year, over half of respondents would still leave their current role and take a pay cut to work at a more technology-driven (56%) or more sustainability-focused (55%) company. This means that keeping up with technology as well as sustainability initiatives is a high priority for frontline factory workers—and should be important to leadership as well.
The good news is that the number of frontline workers planning to leave their current role in the coming year has dropped from 56% last year to 43% this year. Those who do plan to leave want to seek out a new employer offering more paid time off and flexible work schedules, as well as managers that listen to staff—not coincidentally, these are the same factors employees believe contribute to a great work environment, as seen above.
However, those answers tell us that it’s not necessarily the increased cost of raw materials that impacts accessing resources or creates the potential for job insecurity. Those are merely byproducts of workers’ fears that their company won’t be able to properly manage the increased costs of raw materials, and that the financial impacts will spill over into decisions that affect their job security.
Now that you’ve learned more about the successes and concerns of frontline manufacturing workers, which strategies will you deploy to improve their work experience in the future?
You may already be among the 70% of companies offering upskilling opportunities to your workers. If you are, be sure that you’re measuring the success of those upskilling opportunities. Talk to participating individuals to find out how it's helping them in their daily work. If you’re missing the mark on your offerings, take action to improve or change them. The last thing you want is to spend thousands on something like an online learning platform that no one uses.
If you haven’t launched upskilling opportunities, now is the time to do so and create a more valued and valuable workforce. Identify key areas of need, like training on new technology, AI prompting, or leadership best practices. Listen to what the members of your workforce say they need most and address it: build on-site and on-the-job training programs, provide access to online training platforms, or offer to cover tuition and time off for off-site courses and training.
Manufacturing workers are losing their morale, as they told us in the report. But manufacturing leaders have a number of different levers they can pull to turn morale around in the following areas:
Monetary compensation and bonuses: One of the most immediate ways that leadership can improve morale is through higher pay, more bonuses, or expanded benefits.
Non-monetary benefits: Frontline workers can also benefit from non-monetary perks that improve overall quality of life, such ase gym memberships, transportation discounts, breakroom snacks, or childcare support.
Professional development: Offer workers opportunities to improve their skills and rise up the ladder with free courses and workshops, access to a learning platform, mentorship programs, and more.
Flexible work schedules: Giving workers the freedom to determine their daily start and end times can go a long way toward boosting morale and strengthening work-life balance.
Improve leadership: Since “bad supervisors” came up as a reason for low morale, invest in leadership and management training to help ensure that teams are well-led and workers feel respected and encouraged.
Manufacturing companies who want to stay competitive and profitable must invest in new technologies and continue to evolve their technological capabilities. Start by moving off paper or spreadsheets and digitizing your documents into a centralized ERP system. If you haven’t yet, move your systems into the cloud and do away with costly, on-premises servers. Increase your tech capabilities by investing in AI solutions, data analytics solutions, Internet of Things (IoT) sensors, and digital twin or other augmented reality tools.
Improving your technology can also improve morale, when your workers step into a factory that mirrors the ever-evolving technological world they see around themselves each day. Having a tech-forward, innovative factory can also attract new talent.
Not having management that listens came up so significantly in our survey that it bears repeating: Manufacturing leaders should pay extra attention to the needs of their frontline workers. Secondary concerns that arose—and that may be related to the lack of listening—include feeling like their time isn’t being respected, feeling the pressure of unrealistic expectations, experiencing a lack of communication, worrying about job security, and more.
The time for change is now. Start by opening up channels and opportunities for really listening to frontline workers and their concerns. Ask them questions as you walk around the factory floor. Offer opportunities for feedback at team or all-staff meetings. Institute open door policies. Create virtual or physical suggestion boxes.
The important thing is to act now and respond immediately to what workers are saying to you, which shows them you’re really listening—especially when it comes to safety measures. When people feel valued and acknowledged—and when they see managers implementing changes in real-time—they’ll more readily come forward next time. Make the whole process easier with a digital platform that can track issues or concerns, document results, and help ensure all problems get resolved.
