Today’s Current Trends and Where We Are Headed
The past decade has been a turbulent one for the global manufacturing industry. However, the industry is starting to make a huge comeback. Globally, manufacturing has been expanding at the fastest pace since early 2011. “Looking ahead six months, manufacturing leaders remained very upbeat in their global outlook, with … robust growth in overall production for the next six months.” National Association of Manufacturers, January 2018.
The current state of Manufacturing
During a major global recession starting in 2008, employment in manufacturing fell precipitously within developed countries as they transitioned to service economies, particularly in the U.S. However, strong manufacturing industries emerged in developing nations, shifting their economies from subsistence agriculture to higher standards of living along with rising incomes. Manufacturing industries in advanced economies are vital for innovation, research and development, increased economic growth and productivity.
The global manufacturing industry is about to go through a lot of changes. While there are exciting opportunities such as blockchain technology making manufacturing much more cost efficient, manufacturers can no longer rely on old methods in the 21st century.
The Industry 4.0 era has been ushering in new technologies, new business models and new innovative practices, making for higher productivity at reduced cost. Supply chains and distribution channels are becoming more efficient with digitalization, automation and smart sensors. More efficient supply chain management has far reaching implications on the bottom line: “Suppliers now account for 50-70 percent of a typical manufacturer’s final production value.” Mahoney & Helper, June 2017.
There are at least four trends that will shape the global manufacturing landscape in the next decade or two.
Proliferation of Cloud-Networked Smart Factories
Factories today are becoming safer, smarter and more efficient. Smart manufacturing practices utilize sensors and digital process controls that improve efficiency and reduce factory downtime. With the Internet-of-Things market projected to reach $267 billion by 2020, it is clear that we are moving towards data-driven approaches to manufacturing with digitization of machines in hyper-connected industrial IoT networks. These sensors generate huge amounts of data in real-time, and companies are developing analytics tools to process all of that data.
Automation using Robots and Smart Sensors
Historically, factory jobs were risky and sometimes dangerous. Today, that work is increasingly replaced by robots, smart sensors, artificial intelligence, IoT and smart machinery with visual detection systems. The shift from manual labor to automation is now driving the need for new skills, particularly robot technicians and software developers.
Increasing need for New Job Skills
Rather than manual labor, manufacturers need engineers who can design robotics and automation, technicians who can build and maintain hardware, and programmers who can develop firmware for robots. Although robots will be able to do the heavy lifting in factories, they still need humans to program their software, manage and maintain them.
The rise of small-scale Manufacturing
Fortunately for local entrepreneurs and small businesses, small-scale manufacturing is now possible. After having been out of the game for so long, they could now order smaller product inventories using digitized supply chains, competitive production prices, or 3D printing. Plus, the increase in protectionism worldwide also leads companies to favor local factories with high manufacturing output.