Could Mexico Be the Answer to America’s Skills Gap?

Commentary by Doug Donahue

A lot has been made lately about the resurgence of American manufacturing. As US manufacturing wages go down, we are now cost-competitive with places like China, Japan and Western Europe. Many companies are contemplating bringing manufacturing jobs back to US soil; Boston Consulting Group has estimated that this could lead to as many as 2.5 million to 5 million US jobs by the end of the decade.

The problem is that we may no longer be equipped to handle such an influx of work, due to a shortage of skilled workers caused largely by years of outsourcing and offshoring. To make matters worse, STEM training in the US education system is inadequate, putting us in a poor position to train the next generation of skilled workers.

Boston Consulting Group maintains that fears of such a shortage may be overblown for the time being but, without doubt, serious skills shortage could hamper the growth of US manufacturing in the future. In contrast, Mexico has done a great job preparing for the next generation of engineers, technicians and other skilled experts. I estimate there is a technical university for every liberal arts university found in Mexico. Guanajuato alone has 28 different technical schools. These universities, institutes and technical training centers are set up in close proximity to manufacturing companies, making it easy for manufacturers to send their staff there for continuing education and for young, local engineers to receive a strong education.

This translates to a built-in pipeline of talent right in the same vicinity of where cutting-edge industry is setting up shop. American education is far behind Mexico’s forward-looking approach, with dedicated centers mirroring industrial clusters for the automotive, aerospace and other leading sectors. It is truly a win-win scenario.

Entrada’s Approach

Of course, our own clients don’t have the same worries about the recruitment and retention of talent. That’s because as a full-service shelter provider, we manage all the requisite HR processes and talent management, including all staff hiring, freeing them to focus on core operations and quality. Our service offering for clients includes best practices for retention as well as how to address issues like absenteeism and skills transfer. If a client needs to fill a position, direct or indirect, it is Entrada’s responsibility, not theirs. Our long presence in central Mexico benefits our clients because we have a solid network and economies of scale in place, allowing us to fill the more rare “purple squirrel” openings that crop up from time to time – particularly among skilled technical or plant management positions.

Source: https://www.bcgperspectives.com/content/articles/lean_manufacturing_us_skills_gap_could_threaten_manufacturing_renaissance/

 

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