Whether you prefer to call it the Fourth Industrial Revolution or Industry 4.0, there is no denying that industry is getting smarter. 

Summarized as the ongoing automation of traditional manufacturing and industrial practices using smart technologies, it is a seemingly unstoppable trend that has transformed enterprises, captured imagination and generated value. 

According to McKinsey, Industry 4.0 has the potential to provide returns of $3.7 trillion to manufacturers and suppliers around the world by as early as 2025. 

However, a caveat is that today only one in three companies are capturing this value at scale. 

“Approaches are dominated by envisioning technology development going forward rather than identifying areas of largest impact and tracking it back to Industry 4.0 value drivers,” McKinsey adds in its report, “Industry 4.0: Capturing Value at Scale in Discrete Manufacturing.”

“Further governance and organizational anchoring are often unclear. Resulting hurdles related to a lack of clarity regarding business value, limited resources and an overwhelming number of potential use cases leave the majority of companies stuck in ‘pilot purgatory.’

The report identifies several steps organizations can take to make the most out of the opportunities created by Industry 4.0 and its associated technologies. 

Chief among them is investing in human capability to leverage such innovations. 

Last year, the U.S. National Skills Coalition (NSC) reported an “invisible drag on productivity” created by an alarming digital skills gap. In the manufacturing sphere, one in three workers are thought to have no or limited key digital skills, according to research carried out by the Organization for Economic Cooperation and Development. 

Given that the NSC defines “limited digital skills” as an ability to complete simple tasks with a generic interface and few uncomplicated steps (like sorting emails into different folders), it is clear that a large portion of the current manufacturing workforce requires serious upliftment in digital literacy or risk being displaced by more tech-savvy recruits.

Education is the answer

For those about to join the manufacturing workforce, learning digital skills has never been more important. 

This rings especially true against the current coronavirus backdrop, with many industrial businesses having to make cutbacks as a result of drops in business and legal mandates to close as part of pandemic-induced societal lockdowns. 

It is something tech giants are responding to. For instance, in June 2020, Microsoft announced plans to provide free digital skills training to 25 million people around the world in response to predictions relating to a surge in unemployment. 

The speed and extent of economic recovery in part rests on how much productivity can be gained from Industry 4.0 activities, manufacturing being a key economic contributor to communities across the United States.

Education is a key enabler of productivity growth, be it through programs for upskilling current workers or training initiatives designed to ensure new generations of jobseekers are armed with the knowledge they need to hit the ground running.  

In Charlotte, North Carolina, this holds the key to unlocking the manufacturing sector’s bright future. The industry has grown here at twice the national average over the past five years with four clusters driving activity–machinery manufacturing, advanced materials, automotive manufacturing and energy manufacturing. 

“There are many synergies among these clusters,” explains Antony Burton, VP of Economic Research at the Charlotte Regional Business Alliance. “For example, 50 advanced materials firms in the textiles, plastics and composites industries serve the automotive industry in the Charlotte region which requires strong, durable, lightweight materials. 

“There is also synergy between the automotive and energy industry. Arrival, a leading electric vehicle manufacturer, has announced its North American HQ in Charlotte along with two micro-factory production facilities in the bi-state region.”

An enormous lithium deposit also feeds the area’s manufacturing scene. One of the largest such resources in the country, it has lured in major players in the lithium battery value chain and is supplemented by leading automotive and energy research assets at the Charlotte-based University of North Carolina. In short, the region is gearing up to lead and benefit from the transition to electric vehicles. This means new skills will be required to fully exploit the opportunity. 

“Manufacturing enterprises increasingly require a workforce with advanced industrial technology skills that include knowledge of mechatronics, robotics, and computer-aided machining as low-skill jobs are increasingly automated,” Burton adds. “In addition, manufacturing enterprises will require more engineering expertise. The Carolinas have over 7,000 graduates in engineering fields every year to help supply this pipeline of talent.

“It is crucial that the education programs continue to evolve to the needs of industry. Talent continues to be a top factor for location decisions, and the labor market has remained very tight throughout the country despite relatively high unemployment rates. To help provide this talent, along with the University of North Carolina, which has 600 engineering graduates, we have a strong community college system made up of 10 community and technical colleges with a total of 30 locations throughout the region.”  

Burton also cites the North Carolina Motorsports and Automotive Research Center as a unique training asset. Here, the next generation of automotive engineers are trained through a series of partnerships with key industry manufacturers, collaborations which conduct research and drive innovation in the sector. 

COVID-19, without doubt, has presented obstacles to delivering the sort of hands-on training the manufacturing sector requires. However, Burton points to virtually hosted events and research conducted by The Charlotte Regional Business Alliance as examples of its ongoing support for the industry.

“With state and local economic development partners, we organized STREAM 2021, a supply chain tradeshow which brought together manufacturers across the region to learn from industry experts and to help manufacturers find local suppliers,” he says. “In February of 2021, this inaugural event created a virtual opportunity for local manufacturers and suppliers to network and potentially work together to restore supply chains, especially in a time when COVID-19 has disrupted traditional supply chains. 

“Our economic research team also completed a deep-dive analysis of the manufacturing industry in the region and a manufacturing labor and wage survey. The report, “Manufacturing in the Charlotte Region,” provides business intelligence to the local community and to prospective companies.”  

Due west, in Kansas, Franklin County represents one of the top markets in the country for industrial and business development thanks to easy access to Interstate 35, Interstate 70, Logistics Park Kansas City and the Kansas City International Airport, as well as inclusion in the Foreign Trade Zone.

Paul Bean is executive director of Franklin County Development Council, a body which helps businesses to establish themselves and thrive in the area. As well as the digital skills identified by Burton, Bean highlights the critical importance of attitudinal traits sought by his association’s membership base, and how Franklin County Development Council helps them to find the right people.  

“Soft skills are the number one request,” he says. “They report to us that they can train folks but need people that show up, think critically, and are willing to work.

“We work closely with our area school districts, community colleges and private universities to provide programming to support our manufacturing industry. For example, we are just kicking off an online program through Nepris, which helps connect educators and learners to industry professionals. We’re also beginning the process of becoming an ACT Work Ready Community, and work with local higher education institutions on specific programs for new certifications and learning refreshment.”  

Charlotte and Franklin County are just two examples of regions investing in the next-generation workforce. Activity is also taking place at a federal level, supported by former President Trump’s pledges to prioritize homegrown industries. For example, June 2020 saw the launch of a new workforce training grant with several hundred million dollars for states to access. Unveiled by then Education Secretary Betsey DeVos, the scheme supports job training for in-demand occupations and entrepreneurship development. 

“America’s colleges and universities are a national treasure, but it is time for them to reinvent themselves and to be more responsive to the needs of their students and local communities,” DeVos said at the time of the launch. 

Through a mix of national incentives underpinned by bustling activity and support driven at a regional level, the manufacturing labor force has every chance of being future-proofed. Education lies at the heart of this transition and must continue to be substantially invested in if vital American industries are to remain competitive on the global stage.