When an industry is doing well, it is common to see more employees leaving their jobs in pursuit of better opportunities within the industry, so it is not surprising there appears to be more churn recently in the automotive and parts industries. The increase in retirement attrition rates is also expected, as workers who were not eligible to retire or take early retirement during the downturn have now accumulated the age and years of service they need to retire. While churn and retirement attrition pose challenges for hiring both salaried and hourly workers, there’s one particular occupational group where the challenges are particularly acute and that is in automotive skilled trades.
Skilled trades workers in the automotive industry build and maintain the machinery and equipment necessary to manufacture automotive parts and components, assemblies, and vehicles. Automotive skilled trades occupations include electricians, welders, millwrights, pipefitters, machine repair, CNC machinists, mold makers, and tool and die workers. On the whole, the average age of a skilled trades worker skews older than production workers by a couple of years. While the churn and retirement trends affect all trades occupations, tool and die poses a special challenge for the future.
While the churn and retirement trends affect all trades occupations, tool and die poses a special challenge for the future. Automotive tool and die makers and machinists produce the specialized metal patterns and implements that cut and form sheet metals. In the last 10–15 years, this part of the auto industry has undergone tremendous changes. The metals have become more diverse and, in some cases, more difficult to form, as the industry moves to using aluminum, magnesium, and advanced high-strength steels to take weight out of the vehicle for fuel economy and greenhouse gas emissions regulations. During the same time period, the size of the entire U.S. tool and die industry has been nearly cut in half, while automotive tooling capacity in low-cost countries has ramped up — particularly in China. Automotive purchasing decisions drive the move to source tool and die work to China and other low-cost producers. While the “China price” is often cheaper, the product often needs to go through tryout and be modified or repaired before it can go into full-scale production in the United States.
The U.S. tool shops that remain have largely survived because they are pursuing a strategy that takes China into account. There are three basic strategies: (1) design in the United States, build in China, do tryout and launch support in the United States; (2) a hybrid variant of the first strategy where some tools and dies are built domestically, and some offshore; and (3) do virtually no design and build in the United States, and specialize in tryout and launch support for tools and dies when they come back from China. Both the first and third strategies are valid strategies in the short-term, but long-term — absent sufficient orders for domestic builds (coupled with an aging automotive tool and die workforce) — we will soon run out of people who know what needs to be done to make these tools work in tryout and production. This is not a simple problem that training can solve — without the on-the-job training in tool and die build (e.g., strategy 2), it is nearly impossible to produce a journeyperson tool and die maker or machinist who can support tryout, launch, and production utilizing imported dies.
Increased retirement attrition only compounds the problem. It takes nearly 10 years to produce a master tool and die maker. The apprenticeship includes a formal education component — typically done in conjunction with a community or technical college, as well as years of on-the-job training. Ten years ago, the automotive industry was heading into a downturn, and companies were cutting payrolls — not adding apprentices. This has led those companies that are desperate for talent to hire experienced tool and die (and other tradespersons) away from their supplier and competitor companies. The companies that workers leave tend to be smaller firms that cannot pay as well or offer as many employment benefits. So, large firms may be able to lure sufficient skilled trades talent to backfill immediate needs, but smaller firms have no choice but to keep training new employees. Some firms require the apprentice to reimburse the company for the costs of providing their education if they leave within a certain window of time.
The coming crisis in skilled trades — and tool and die, in particular — is only going to become more severe as the automotive industry prepares to launch record numbers of new and refreshed models over the next few years. We need to attract younger people to careers in the trades, and support training for smaller firms that struggle to retain their workforces in this hot employment market. Economic developers, community and technical college leaders, and the workforce development practitioners in automotive communities need to be aware of these issues, and work with their local industry and tool shops to address the skilled trades recruitment and training needs that could put a damper on the auto industry’s future product cadence and continued growth.
What Do Tool & Die Makers Do?
The job involves the ability to translate blueprints and computer models into a plan to build tools, dies, and assemblies. To do this, tool and die makers must:
- Pay close attention to measurement, and utilize advanced measurement tools
- Lay out the metal stock according to the print or model, and machine the surface to the required contours
- Set up and operate a variety of conventional and computer numerically controlled machine tools
- Conduct tool and die tryout to make sure the parts produced meet the specifications required, and if not, modify and adjust the tool or die until it does produce in-spec parts
- Inspect the tools and dies for any defects and repair them