HR in the manufacturing industry: Role and 7 key challenges

Human resources (HR) plays an important role in the success of businesses in any industry, and manufacturing is no exception. While the core functions of HR remain consistent across sectors, the manufacturing industry presents its own unique set of challenges and responsibilities for HR departments.

Effective HR management in the manufacturing industry is vital to maintain a safe, productive, and motivated workforce. Without proper HR strategies, manufacturing companies may struggle with employee engagement and retention, safety regulation compliance, and adapting to technological advancements.

In this article, we explain the key responsibilities of HR in manufacturing, outline the common challenges, and discuss best practices to help HR departments drive success in this competitive field.

The role of HR in manufacturing

The role of human resources in the manufacturing industry has distinct responsibilities. Unlike many other industries, where desk work and remote opportunities may be the norm, HR in manufacturing must address challenges specific to a predominantly hands-on workforce, from accident prevention to maintaining high employee engagement and morale. Here are some of the major responsibilities HR professionals manage in manufacturing companies:

Creating policies for accident prevention

Safety is a top priority in manufacturing companies, and HR plays a significant role in developing and enforcing policies to prevent workplace accidents. This includes ensuring proper training on equipment use, maintaining up-to-date safety protocols, and promoting a company culture of safety. 

HR in the manufacturing industry must work closely with operations teams to identify risks and implement strategies that minimize them, keeping employees safe and reducing liability for the company.

Ensuring employee retention

The manufacturing industry has characteristically high turnover rates. As such, employee retention can be a major concern for manufacturing companies. It's the role of HR to create programs that boost both employee engagement and the overall employee experience. This may include offering competitive compensation packages and clear career progression paths, while fostering a supportive work environment. 

These retention efforts can help to enhance productivity, retain skilled talent, and promote a stable and motivated workforce that drives business goals forward.

Setting specific performance standards

In manufacturing jobs, performance typically relies on output, efficiency, and quality control. It's the role of HR professionals to set clear, achievable performance standards that align with company goals. These standards drive consistent productivity and ensure that employees meet safety and quality expectations. 

It’s also the HR department’s responsibility to equip employees with essential tools, such as training programs, standard operating procedures, and effective feedback mechanisms, to help them successfully meet performance benchmarks.

7 HR challenges in the manufacturing industry

Here are some of the most pressing challenges HR professionals may encounter in manufacturing companies:

1. Low employee engagement

Manufacturing companies often struggle with low employee engagement because of the demanding and repetitive nature of manufacturing jobs. Employees frequently operate in fast-paced, physically intensive environments, which can create feelings of isolation and detachment from company culture.

Unlike industries with more interactive work environments, manufacturing jobs often offer limited opportunities for communication and collaboration, which can lead to a disengaged workforce. This lack of engagement can affect day-to-day productivity and also result in higher turnover rates, making it challenging for HR departments to retain skilled talent and maintain a motivated workforce.

2. Keeping up with digital transformation

Companies in the manufacturing industry can face significant challenges in keeping up with digital transformation, as many production lines still rely on manual processes that have been in place for decades. The introduction of automation, AI-driven equipment, and digital tracking systems requires the workforce to learn new skills rapidly, which creates a gap between the current capabilities of employees and the demands of new technologies.

This struggle to adapt often results in slow adoption of digital tools, inefficiencies in production, and frustration within the workforce. HR professionals in manufacturing must navigate these challenges, as employees may feel overwhelmed by the rapid pace of change, leading to resistance and skill gaps that hinder progress in a digitally transforming industry.

3. Compliance with safety regulations

Manufacturing companies typically operate in high-risk environments, where safety compliance is imperative. HR faces the challenge of navigating a web of strict and evolving safety standards, such as Occupational Health and Safety (OHS) regulations. 

HR departments face a lot of pressure to stay up-to-date with these regulations, conduct frequent safety training, and ensure employees follow protocols. Noncompliance can lead to serious consequences, such as workplace accidents, legal penalties, and production shutdowns, making safety management a top priority and ongoing challenge.

4. Dealing with global competition

Global competition presents a multifaceted challenge for HR in manufacturing companies, impacting productivity, cost management, workforce strategies, and recruitment. Manufacturing companies must compete with both local and international rivals that may benefit from lower production costs, faster turnaround times, or access to cheaper labor. These pressures often push HR teams to ensure that productivity levels remain high while dealing with constraints, like limited resources or higher operating costs.

Additionally, competition forces HR departments to balance maintaining a skilled workforce while keeping up with industry standards. This becomes challenging when competitors are more agile or offer better wages and benefits. As a result, HR constantly faces pressure to optimize workforce strategies, which can complicate the ability to meet production targets and maintain a competitive edge on a global scale.

5. Dealing with employee physical and mental overload

Employees in manufacturing jobs frequently face physical and mental overload because of long hours, repetitive tasks, and the high demands of meeting production targets. The physically intensive work environment can lead to fatigue, burnout, and decreased job satisfaction, which contribute to higher turnover rates and make it difficult for HR to retain talent.

This overload often complicates hiring efforts, as the demanding nature of the work can deter potential skilled candidates, particularly among younger generations who may prioritize work-life balance and less physically taxing roles.

6. Carrying out performance evaluations

In fast-paced, output-driven environments like those in the manufacturing industry, performance evaluations often focus narrowly on metrics, like production speed and efficiency. This makes it difficult for HR to provide well-rounded evaluations that consider individual contributions, employee development, and overall morale.

As a result, employees may feel undervalued or overlooked, leading to dissatisfaction and disengagement in the workplace, while HR departments struggle to implement a more comprehensive performance management system.

7. Scheduling issues

Scheduling is a constant challenge in manufacturing companies, where operations often run 24/7 to meet demand. The need for continuous production, coupled with fluctuating demand and unexpected employee absences, can create complications for HR teams when trying to maintain a stable workforce.

Balancing shifts, managing overtime, and addressing staff shortages without disrupting productivity are ongoing challenges. The unpredictable nature of scheduling can also frustrate employees who may struggle to balance work with personal life, leading to dissatisfaction and turnover.

3 HR trends in the manufacturing industry

HR in manufacturing is adapting to several key trends that reflect changes in workforce expectations and industry demands. You can explore them below: 

1. Sustainability approaches

Sustainability is gaining importance in manufacturing, both in production and human capital management. HR is increasingly responsible for implementing green initiatives, such as energy-saving programs, recycling efforts, and promoting environmentally friendly workplace practices.

Employees, especially from younger generations, typically prioritize employers with strong sustainability values. As a result, HR is placing an increasing focus on aligning recruitment and retention strategies with sustainability goals to attract and engage talent committed to environmental responsibility.

2. Diversity and inclusion

Diversity and inclusion are becoming key priorities in HR strategies for manufacturing, as companies aim to attract a more diverse workforce. In an industry that has traditionally been male-dominated, there's now a growing focus on creating more inclusive environments that appeal to a wider range of talent, including women, minorities, and younger generations.

HR departments are enhancing recruiting efforts to ensure fair hiring practices, develop mentorship programs, and foster a company culture that values equity. By promoting diversity, manufacturing companies can boost innovation and job satisfaction while remaining competitive in a changing market.

3. Digital transformation

Digital transformation is rapidly driving innovation in the manufacturing industry, with automation, AI, and data analytics enhancing efficiency and productivity. For HR, this trend involves integrating digital tools into daily operations, such as recruitment, performance management, scheduling, and employee development software, while also upskilling the workforce to handle advanced technologies.

As manufacturing becomes more tech-driven, HR is focusing on fostering a culture of adaptability and continuous learning to ensure employees can thrive in this developing, technology-enhanced environment. This trend is reshaping how HR supports both employees and business objectives in the modern manufacturing landscape.

4 best HR practices in the manufacturing industry

Here are four key best HR practices in manufacturing that can help HR teams create a positive and efficient work environment while they address the unique challenges of the industry:

1. Be aware of employee wellness

Employee wellness includes the physical, mental, and emotional well-being of your workforce. In manufacturing, where demanding and hazardous tasks are common, prioritizing wellness is key to preventing burnout, injuries, and high turnover.

For example, your HR department may implement an on-site wellness program with regular physical checkups, ergonomic assessments to reduce strain, and mental health support services.

2. Automate tasks with HR software

Automating routine HR tasks, like payroll processing, time tracking, and performance evaluations, using specialized software can streamline operations and reduce administrative workloads. This saves time and reduces human error, boosting efficiency and freeing up your HR team to focus on strategic initiatives like employee engagement and development.

For example, if your manufacturing company has global operations, it may implement a Global Human Resources Information System (HRIS) to centralize employee data and simplify compliance, payroll, and performance management across different regions, ensuring consistent HR processes and reducing complexities related to global workforce management.

3.Invest in training and development

Investing in continuous training and development helps your employees stay updated with new technologies and improve their skills. This is imperative in manufacturing, where automation and digital tools constantly evolve, requiring staff to adapt quickly. Well-trained employees tend to be more productive and are likely to stay with the company longer, reducing turnover and increasing overall job satisfaction.

For example, you might offer regular workshops on operating new machinery or provide online courses for employees to learn about lean manufacturing principles. Tailoring these programs to specific job roles ensures that employees develop the skills they need to meet the demands of the industry.

4. Promote safety as a core value

Embedding safety deeply into your company culture ensures that every employee understands and follows safety protocols. Prioritizing safety prevents accidents and regulatory penalties, while also building employee trust and loyalty by demonstrating genuine care for their well-being.

For example, by adopting software with automated onboarding capabilities, you can integrate safety policies and training directly into the onboarding process. New hires can complete safety courses and certifications before starting work, facilitating their full awareness of safety protocols and regulatory requirements from day one.

Rippling: Easy HR management for your manufacturing company

Rippling offers an all-in-one solution for seamless HR management in manufacturing, ensuring that every part of your HR process is streamlined, automated, and built on a single source of truth. 

With Rippling, you can onboard new hires in just 90 seconds while automating the delivery of safety training and company policies, and tracking their completion. You can set and monitor employee goals, offer valuable feedback, and provide learning programs, engagement surveys, and scheduling features that respect employee availability.

The platform simplifies time tracking and payroll, handling complex calculations like shift differentials and piece rates, all with a 100% error-free guarantee. Plus, it takes the busy work out of Fair Labor Standards Act (FLSA) compliance, providing you with peace of mind and more time to focus on strategic objectives.

And that's just the tip of the iceberg. With Rippling on your side, you can make your entire organization more productive, reduce administrative burden, benefit from better decision-making, and offer a modern, intuitive experience that employees love.

Manufacturing HR FAQs

What are the best recruitment strategies for manufacturing roles?

Manufacturers can benefit from using platforms that connect them with skilled candidates in trades, machinery operation, and production. Beyond just competitive wages, offering clear career development paths, employee benefits, and emphasizing the company’s commitment to safety and growth can make a role more appealing. Tailoring job postings to highlight not only required skills but also the long-term opportunities within the company can help attract top talent.

By promoting a strong company culture, HR can reduce attrition and ensure they hire those with an investment in their future with the company.

What are the best practices for onboarding new employees in manufacturing?

The best practices for onboarding new employees in manufacturing involve ensuring a smooth transition from recruiting to active roles by focusing on safety, role clarity, and cultural integration. Automating the delivery of safety training and company policies ensures consistency and compliance. It's essential to tailor the onboarding process to the specific needs of the sector, including job-specific equipment training.

Additionally, maintaining regular check-ins during the initial weeks can help address concerns early, reducing turnover and reinforcing the investment made during the recruitment process.

How can you improve performance management in a manufacturing environment?

Improving performance management in the manufacturing sector requires setting specific, measurable goals that align with production metrics, like efficiency and safety. Regularly tracking progress through performance data and using employee feedback to make real-time adjustments helps employees stay engaged.

Proactive performance management can help identify skill gaps and provide clear direction and role-specific training for improvement, leading to enhanced workplace productivity. It can also assist with recognizing and rewarding high performing employees, which can reduce attrition and ensure a committed workforce in this demanding industry.

What HR strategies can help improve diversity in manufacturing?

To improve diversity in manufacturing, HR can focus on inclusive recruiting strategies that target a broader range of candidates, ensuring fair representation across different demographics. The role of HR is essential in fostering an inclusive workplace by promoting diversity in leadership roles, offering bias training, and creating mentorship programs for underrepresented groups. Additionally, HR can collect workplace feedback to continuously assess and improve diversity initiatives, helping the company attract and retain diverse talent while maintaining an inclusive culture.

This blog is based on information available to Rippling as of October 25, 2024.

Disclaimer: Rippling and its affiliates do not provide tax, accounting, or legal advice. This material has been prepared for informational purposes only, and is not intended to provide or be relied on for tax, accounting, or legal advice. You should consult your own tax, accounting, and legal advisors before engaging in any related activities or transactions.