The manufacturing industry is the main driver of the U.S. economy, providing nearly 13 million jobs and generating more than $2 trillion in gross domestic product (GDP). More specifically, the manufacturing’s GDP share exceeds 20 percent in the top 60 largest global economies. However, political shifts, the ongoing pandemic, rapidly growing technology, and supply chain disruptions have caused many in the industry to worry about too much change, too fast.
Here are a number of emerging risks in the manufacturing industry.
The manufacturing industry has a hefty reliance on foreign steel face significant cost increases, which is likely to cut into profits and even result in layoffs. Steel prices in the United States are already almost 50 percent higher than those in China and Europe, and aluminum prices are increasingly volatile.
With this past winter’s trade wars not yet forgotten, the U.S. manufacturing industry is facing rises in tariffs and imposing duties that are likely to slow job creation and could negatively offset the gains achieved through regulatory and tax reforms.
The Rate of Change
The world is moving faster than ever before, and technology is changing the way we do business, live, connect, and retrieve information. It’s also affecting the manufacturing industry through the rapid development of emerging technologies. The overall end goal is increased automation, improved communication, and self-diagnosis to boost new analysis levels between machines and systems.
However, the challenges of achieving this level of manufacturing efficiency and modernization are enormous in scope. New frameworks of cybersecurity and a focus on manufacturing risk management need to be considered in technology advancement plans. In the end, these advancements will help customers and suppliers alike while also ensuring safety moving forward.
Marijuana in the Workplace
The Trump administration recently signaled its potential support for amending the Controlled Substances Act to allow state-legal marijuana activity. What’s more, state governments have continued to vote in legal marijuana use either for recreational or medical purposes.
All this coming together would bring change for employers because marijuana’s federal legal status has been a staple of most employment practices legal issues involving legal marijuana use. Manufacturing employers have significant reasons to be concerned as most tend to rely on zero-tolerance policies to protect workers in safety-sensitive positions.
The manufacturing industry has always been one that’s operated with several physical risks. But with high turnover numbers and tight staffing, there’s an environment with a reduced emphasis on safety culture. Experienced workers have little time to train new hires, and inexperienced workers in a manufacturing role are at high-risk for injuries.
More than three million industrial robots are currently in use in factories across the U.S. Robots have the potential to offset the talent gap and raise productivity, but it all comes with risks. Liability issues due to product defects, personal injury, property damage from malfunctioning equipment, and hardware issues can lead to massive losses and kinks in the overall supply chain.
While all these risks pose potential threats to the industry, manufacturers are doing their best to stay on top of these trends to limit as many losses and risks as possible.
About The Hilb Group
Deciding what coverage you need and what limits and deductibles make the most sense can be tricky. Founded in 2009, the Hilb Group has been helping clients to make sense of their options and make the smartest choices for their circumstances. Whether you need Warehouse Insurance or any other type of business or personal coverage, we encourage you to contact our friendly, experienced, and capable team today. Call us at (800) 776-3078 for a consultation.