Manufacturing’s future depends on people

Manufacturing accounts for around 10% of the UK economy, supporting vital supply chains, skilled employment and the production of technologies and infrastructure used throughout everyday life. Yet the workforce behind this contribution is under growing pressure.

Recent data presents a complicated picture. Manufacturing is in many ways one of the few current UK success stories. Investment intentions rose to +15% in Q3, but employment growth remained at just +3%. Manufacturers may be cautious about increasing overall headcount amid high employment, energy and input costs, but they also continue to face persistent shortages in the specialist skills needed to modernise and grow.

The sector must therefore retain experienced employees, preserve their knowledge and attract people with the capabilities required for modern production. Only then can investment in AI and automation deliver its full value.

More than a recruitment problem

Manufacturing’s workforce challenge is not straightforward. Even where businesses are slowing general recruitment, critical technical and operational roles can remain difficult to fill. Manufacturers must therefore address immediate skills shortages while developing a stronger and more diverse talent pipeline for the future.

Claire Hu Weber, Vice President of International Markets at Fluke Corporation, believes the situation demands urgent action: “It’s no longer just ‘important’ to bring young people into manufacturing, it’s mission critical. The skills gap is widening year after year, and the numbers don’t lie. In the UK, more than half of manufacturers expect up to a fifth of their workforce to walk out the door into retirement within the next decade.

“Add to that the fact that women make up barely a quarter of the UK manufacturing workforce, we don’t only have a lacking workforce pipeline but a lack of diversity too. Unless we move fast to attract new talent and break down the barriers that keep women from entering and staying in the industry, we’ll lose not just capability, but the diversity of thinking that fuels real innovation and growth.”

Building that pipeline will take time. In the meantime, manufacturers also need to retain the people and expertise they already have, particularly while broader hiring remains subdued.

Will Eadie, Chief Strategy Officer at WorkJam, explains: “Recent WorkJam research found that 52% of manufacturers have reduced or slowed hiring over the past six months. At the same time, employee engagement and retention were the most-cited workforce challenges after cost reduction.”

Keeping employees engaged depends partly on ensuring they feel connected to the wider organisation. This can be difficult on the shop floor, where workers may not have regular access to the communication channels used by office-based colleagues.

“The challenge for manufacturers is not simply getting information out, but making sure it reaches every employee and giving frontline workers a way to respond, particularly those who can be difficult to reach through traditional workplace communication channels,” Eadie adds. “Stronger two-way communication can help manufacturers keep employees informed, give them a voice and ensure important feedback from the shop floor reaches the wider organisation.”

Keeping experience in the business

Of course, it’s inevitable that older workers will leave the sector as they reach retirement age. As this happens, businesses need to ensure they’re not losing decades worth of expertise and experience with them.

Jesus Hernandez, Senior Vice President, EMEA at AVEVA, warns:“The challenge is not simply bringing enough people into manufacturing. As experienced workers leave the workforce, manufacturers also need to ensure that decades of practical knowledge do not leave with them. That means turning existing expertise into knowledge the next generation can access and build on.”

“Active mentoring from experienced team members can build essential understanding, enabling newer employees to learn whydecisions are made, from meeting safety and regulatory requirements to navigating complex technical processes. AI can also support this transfer of knowledge, with LLMs providing a valuable interface between people and complex industrial information.”

“As experienced workers leave industry, so does the judgement built through trial, error and high-stakes decision-making,” adds Paraic O’Lochlainn, VP at eMaint. “The next generation is not looking to relearn everything the hard way. They expect smarter tools, fewer avoidable mistakes and careers that are sustainable — mentally, physically and professionally. While manufacturing itself has changed, it is no longer a dark, smoky backroom of the economy. It is becoming one of the most technology-intensive arenas for AI, data and automation.”

Opening clearer routes into the industry

Manufacturers also need to make the sector more visible and accessible for young people. Outdated perceptions of repetitive, physical work do not reflect an industry offering careers across engineering, data, design, automation, operations and sustainability.

Duncan Ferguson, Managing Director of Epson UK Ltd., argues that businesses must develop stronger relationships with the institutions and communities around them: “Closing that gap means investing in existing employees through training and upskilling, while building stronger connections with schools, colleges and local communities to inspire new talent.”

“The next generation should see manufacturing for what it increasingly is: a technology-led industry where skilled people have interesting and rewarding jobs which are fundamental to turning innovation into greater productivity, resilience and growth.”

Factory visits, apprenticeships, mentoring and partnerships with education providers can make these opportunities tangible.

Using technology to strengthen workforce skills

Alongside a clear workforce strategy, AI and other forms of automation can also be transformative for businesses when addressing skills challenges. These technologies can undertakerepetitive work and make operational information more accessibleto staff.

Epson’s Ferguson explains: “Manufacturing is entering one of its most significant periods of change in decades. AI, automation and integrated production systems are revolutionising how factories operate, but technology alone will not determine the industry’s future. The people with the skills to apply it will.”

One important application of AI will be making existing industrial knowledge easier to retain and share. “The ‘hard way’ built British manufacturing as we know it,” says eMaint’s O’Lochlainn. “But relying on that approach today slows progress. The strategic path forward is to capture that lived experience and translate it into scalable systems. AI can help put veteran know-how into the hands of each new starter helping people adapt quickly, avoid preventable failures, and focus on continuous improvement.”

However, introducing AI successful requires more than blindly introducing new technology. “Generic AI tools weren’t built for manufacturing,” points out Leanne Taylor, CEO at Syspro. “Industry-specific solutions let teams build and manage AI workflows without coding expertise, while keeping full visibility into how recommendations are made and which actions are being delegated. That combination of industry knowledge and transparent AI is what actually moves the needle.”

Simon Bowes, CVP Manufacturing Industry Strategy EMEA at Blue Yonder, believes this transformation will create new types of work: “We are already seeing manufacturers move beyond traditional automation towards cognitive operations that can predict, learn and adapt. AI and agentic automation can bring people, robotics, inventory and fulfilment together, helping organisations anticipate demand, dynamically allocate resources and respond to disruption. Rather than replacing people, this creates opportunities for higher-value roles in areas such as data, intelligent planning, automation management and sustainability.”

Building the foundation for modern manufacturing

However, if this world of intelligent manufacturing systems is to emerge, there must also be a focus on creating resilient infrastructure beneath them. AI and automation depend on operational data being processed quickly and continuously, often close to the equipment generating it.

“Manufacturing is often associated with machinery and production lines, but modernisation relies on an invisible layer of resilient technology,” outlines Mark Christie, Field CTO at StorMagic, explains. “Behind the equipment, small data centres process the information needed to keep production moving. In high-speed bottling plants, for example, local workloads scan thousands of drink cans per minute to detect defects before they leave the conveyor belt. If this processing happened in a location further afield, even a small delay or network problem could interrupt the checks and affect production.”

Manufacturers must balance the operational need for stability with the IT requirement to update and secure technology. Modernisation cannot come at the expense of production continuity.

The future of UK manufacturing will therefore depend on more than technology. It will be shaped by whether businesses can retain experienced employees, share their knowledge and encourage a new generation to join the industry. With that foundation in place, AI and automation can extend human capability and support a more productive and resilient sector.