October 2017
Steel Industry Looks to Attract Next Generation of Skilled Employees

By Jonathan Samples, Associate Editor

The U.S. steel industry has an age problem. Millennials make up more than one-third of the workforce in America, and many of them are not pursuing careers in manufacturing, particularly metal and steel manufacturing.

Of the more than 15 million workers employed in manufacturing jobs in 2016, people under the age of 35 made up roughly 29 percent of the workforce. In primary metals and fabricated metal products manufacturing, that figure is even lower at 27.8 percent. With a large portion of baby boomers set to retire in the next decade, many in the industry are wondering how they will fill the ranks from a labor force that is increasingly made up of millennials.

“When you look at the steel industry, in general, we have an industry that is essential without its future,” said Gaurav Chhibbar, a freight trader at Cargill Metals, Minneapolis. Chhibbar was one of several industry professionals who spoke on a panel aimed at attracting, hiring and retaining young people in manufacturing and steel distribution during last month’s Steel Summit 2017 in Atlanta.

Chhibbar, who is himself a millennial, sees the skills gap that exists between the youngest workers in the industry and the roughly 50 percent of employees above the age of 45 as the biggest challenge facing steel today. With a growing number of positions that need to be filled and so few young people excited about a career in manufacturing, the concern is that hiring managers will be left to choose from a pool of what Chhibbar deems “subprime employees.”

“The biggest challenge you all face is not just brining millennials into the workforce and engaging us, but also making sure that you’re not employing the subprime employees,” Chhibbar said. “We have to avoid the subprime employee crisis that faces the manufacturing industry by investing in teaching, training and encouraging your employees.”

The way to do that, according to Jack Bellissimo, manager of corporate sourcing at Shelton, Conn.-based Hubbell Inc., is through marketing the growth potential within the steel industry and making a concerted effort to appeal to millennials’ lifestyles, expectations and unique skillsets.

“We have to get excited about [the industry], we have to recruit, we have to be out there, and we have to be upfront and honest,” he said. “If you’re not excited about it, your candidates aren’t going to be excited about it. That’s the bottom line.”

Part of that excitement comes from the opportunities for career advancement that exist within steel. Bellissimo sees companies in the tech industry, which typically attract many high-potential millennial candidates, as having less room for growth than companies involved with steel. While a company such as Google will usually have a huge base of senior and entry level employees to fill management and executive positions, that pyramid is reversed within the steel industry. A small base of younger, entry level employees will be expected to fill the large number of management and executive positions becoming available as more and more in the industry head toward retirement.

“Create a value proposition, highlighting what millennials want, and invest the time to develop real career progression plans,” Bellissimo said. “While recruiting, lay out and explain the opportunities that exist inside the steel manufacturing industry.”

One company doing a good job of attracting younger talent is Pacesetter Steel. Of the company’s 365 associates, about 33 percent are millennials. Justin Philipp is the people area director at the Kennesaw, Ga.-based steel distributor, and he thinks the best way to find skilled young people is through an intricate screening and interviewing process. That starts by being honest with a potential candidate about their position, whether there are opportunities for advancement, and, most importantly, your company’s culture.

“Something you’ll find about millennials is we appreciate honesty,” Philipp said. “Whenever we hide and sweep things under the rug during the interview process, we’re actually doing a huge disservice. I can tell you, as a millennial, when you get smacked in the face with just a little bit of that honesty, you appreciate it; it builds a bond instantly.”

But even before the interviewing process begins, many at the conference agreed that companies themselves must improve efforts to recruit future employees at the high school level or younger.

Detroit Lakes, Minn.-based BTD Manufacturing is doing just that. President Paul Ginter, while speaking on a different panel at Steel Summit, said his company helped create a STEM lab in a Minneapolis-area middle school, and he suspects that those types of programs will go a long way toward attracting more and more talented youngsters to the industry.

“It’s a slow process, but it’s going to work,” Ginter said. “It’s going to work because the enthusiasm that’s in that room, when they’re in that lab, is where I was as a kid. We’ve got to get kids back into the world of manufacturing, touching things, seeing things, long before high school or college.”

And once you bring this new generation of employees on board, Bellissimo’s advice is simple. “Reward the effort not just the results, encourage your younger generation to take risks inside your company, give them leadership responsibility, and then draw out that career plan.

“If you do those things, we are going to change the way steel is made and produced.”
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