The steel industry and its distribution networks are critical for the long term health of the United States manufacturing base and the infrastructure which supports and ships its products. Human resource challenges threaten the sustained growth and prosperity for both segments.
The Human Resource Challenge
Both steel manufacturing and steel distribution have undergone enormous transition and consolidation. The financial strength of the remaining players is healthier than at any time in its history. So why then should such an environment project a possible human resource challenge?
For starters, the raw levels of employees in all sectors of the supply chain have undergone continuous decades of decline in its numbers. The numbers of union and non union manufacturing jobs are well documented. The white collar jobs have also followed a similar path. The number of people necessary to run both steel mills and distribution companies has declined as these companies became more efficient. The future vision for both AI and robotics strongly suggests that these numbers are likely to decline even further.
Key Issues
Attracting and retaining skilled workers – Improving organizational culture convincing managers and reforming structures that can support better knowledge sharing.
Adapting to technological advancement – Embracing and investing in advancements in automation, data analytics and the latest industry technologies.
Ensuring employee commitment and retention – Provide opportunities for professional growth, good compensation and cultural climate to help attract and retain talent.
Traditionally, people have rarely trained or educated themselves for the majority of the jobs available in these companies. Finance and technology areas may be the exception. The steel industry and its related distribution networks have never been the top target industry for those specialties. The industry does not generally encourage its employees to recruit the next generation. Consequently, once employed, the companies no longer engage in benefits which used to be described as “golden handcuffs” to retain long term relationships which lessen turnover. Graduates today at any level of education are projected to have 3 careers and 8 jobs. As a result, current employees are working longer, retiring later leaving a potential gap for experienced key operations and sales managers. All of this data suggests that a human resource crisis Is developing at an alarming speed just like the technology which drives it.
Add to this equation that mills and distributors who locate near them have chosen locations driven by tax incentives and logistical advantages that are generally not attractive locations to attract younger workers and their families or seasoned managers who prefer more sophisticated urban settings where climate and amenities excel.
