- The manufacturing industry is facing a growing labor shortage.
- AR technology can help address this problem while building a workforce that is ready for the future.
Whether it’s due to the retirement of the workforce or challenges in hiring skilled workers, there is currently a labor shortage in the manufacturing sector.
Manufacturers are experiencing the departure of their most skilled and experienced workers as a result of an aging workforce and economic factors creating pressures to incentivize older, more expensive workers to retire. In 2021, the U.S. Department of Labor reported that there were more than 425,000 openings for machinists and tool and die makers nationwide. The average age of a machinist is 53 years and 90% of machinists are over 40. Many are retiring as a result – and decades of experience can be lost with each worker retiring.
Despite the high demand for manufacturing jobs, the number of entry-level job openings in manufacturing continues to increase. In fact, U.S. manufacturing is expected to have 2.1 million open jobs by 2030. Manufacturers find it 36% harder to find talent today than in 2018, although the unemployment rate is much higher than in the recent past.
Why is hiring such a challenge?
The bottom line is that there are more job openings than people with enough experience to be hired – and they don’t get that experience for a variety of reasons. These jobs often require a practical, applied training program that can last from a few months to more than a year. Moreover, with the continuous digital transformation of the manufacturing industry, the required skills are changing and a large part of the workforce does not yet possess these skills.
In addition, younger workers have different expectations of jobs and careers or simply a lack of interest in the industry. This lack of interest can be largely attributed to misconceptions about production. Many recent graduates view the manufacturing industry as an industry for people who have not completed post-secondary education. In reality, there are many manufacturing jobs that require a college degree and some require a PhD.
A recent Manufacturing Institute survey found that while domestic manufacturing is considered increasingly important to the economy, many Americans are unaware that the industry is becoming increasingly high-tech — which not only improves worker productivity, but also increases productivity. offers highly advanced transferable skills.
One such advanced technology is augmented reality (AR). AR is a highly visual, interactive method of presenting relevant digital information in the context of the physical environment. It can connect employees and improve business results. Simply put, AR can democratize knowledge. This is especially important because as experienced production workers grow older, their knowledge can be easily shared with more technology-focused younger workers.
AR technology improves what we see in the present by integrating simulated objects and information into the real world. Using AR in manufacturing enables new, revolutionary training methods that allow employees to virtually learn and perfect tasks in the environments where they will be performed, accelerating key metrics such as time to productivity and time to resolution. Because AR breaks through the limitations of the physical world, people can be together regardless of distance.
By implementing AR technology, industrial enterprises increase the efficiency and safety of their workforce, improve operational performance and reduce costs in the plant and field. Manufacturing experts can capture step-by-step procedures and best practices as they work, then convert those insights into reusable process documents, job tools, and training materials, helping less experienced or novice workers get started quickly and efficiently.
AR can deliver critical information to production workers exactly when and where they need it. It provides a way to easily create and deliver actionable work instructions by integrating digital content into real work environments. By empowering workforces with AR through better information delivery, faster knowledge transfer, modernized training methods, instant access to outside expertise, and enhanced customer experiences, the industry will change when it’s needed most.
AR is reshaping the way production workers acquire knowledge and digitally interact with their physical environment, resulting in faster execution, fewer manual processes, and better decision-making. Knowledge is essentially democratized as the wider workforce has easy access to the most knowledgeable information for the job.
Experts believe the metaverse will represent the next major computing platform, transforming the consumer experience and business models across all industries.
Fashion brands are an example of this. Over the years, clothing companies have perfected the design, manufacture and distribution of clothing to anticipate consumer wants and needs in accordance with seasonal changes. But today, most of their revenue is surpassed by Fortnite’s $3 billion in digital cosmetics sales, which have cultural significance that extends far into the physical world.
This is one of the economic opportunities of the metaverse – the ability to ‘assetize’ digital content, creating a framework of digital ownership for users. If copied at scale and across sectors, entire industries will be reshaped through changes in their traditional value chains.
However, the promise relies on the advancement of several key technologies, including augmented, virtual and mixed reality (collectively known as XR), as well as blockchain, connected devices and artificial intelligence. How should these be managed in a way that promotes their economic benefits while protecting the safety, security and privacy of individuals?
The World Economic Forum brings together leading voices from the private sector, civil society, academia and government to answer this precise question. Over the next year, it will build a multi-stakeholder community focused on metaverse governance and economic and social value creation.
It will recommend regulatory frameworks for good governance of the metavers and explore how to strengthen innovation and value creation for the benefit of society. Updates will be published regularly on the World Economic Forum website.
Looking ahead: the future of the manufacturing industry
Amid industry-wide skills gaps and a changing work environment, manufacturing organizations view AR as critical to increasing operational efficiency and productivity, as well as enriching the overall employee experience. AR can help close the skills and knowledge gap and ensure all employees have the tools they need to succeed. As the digital transformation of the manufacturing sector continues, tomorrow’s workforce must develop and hone new skills today – and AR makes that possible.