Like the farmers they build their tractors for, machinery manufacturers are facing a tough labour market, thanks to the countryside vacuum left by all the skilled employees who have rushed to North America’s booming cities. Maintaining production efficiency in that market is taking some intense, strategic thinking.
Now, it appears that at least some of that thinking is paying off.
“It’s been pretty lively since about last July when we started our recruitment efforts,” says Mark Dykema, manager of human resources at AGCO’s Jackson, Minnesota assembly plant. That facility along with the company’s Hesston, Kansas plant have had to significantly grow their workforces recently to keep pace with expanded production.
It’s meant finding large numbers of qualified workers in regions outside of major metropolitan areas. “It is definitely a challenge to grow in an area as small as we are,” Dykema says.
The Jackson plant just grew by 75,000 square feet to accomodate expansion of the third assembly line for production of 8600 Series Massey Ferguson and MT600D Series Challenger tractors. Previously, these machines had been built in AGCO’s Beauvais, France facility. That growth in the Jackson plant’s output meant boosting the workforce to 1,050. “Our employment on campus has gone up by 200 people since July last summer,” says Dykema.
Despite limited labour resources in the relatively rural southeastern corner of Minnesota where Jackson is located, nearly all of the company’s new workers were found locally. “Most (employees) have come from about a 45-minute radius of Jackson,” says Dykema. “We’ve tapped out the area in seasoned skilled labour, like welders for instance.” So the company has had to embark on a wider recruiting drive for those workers.
With a local unemployment rate of only five or six per cent, many of the new hires had to be lured away from other firms. “It isn’t like there were hundreds and hundreds of people out of work,” Dykema says. “A lot of the people we are hiring were working somewhere else and they’re leaving that job to come and work for us.”
The Jackson plant was able to attract the larger workforce it needed without offering incentives like hiring bonuses because of a longer-term strategy by AGCO to position the plant as a premium workplace. “We’ve been branding our employment here for a number of years, really striving to become the employer of choice in this area,” Dykema says. “We offer pretty competitive wages and benefits.”
Bill Kaltenberg, vice-president of operations at AGCO’s Hesston, Kansas facility, says his plant has used the same long-term branding strategy to attract staff. “In most cases we try to be the employer of choice,” he says. “We’ve added 200-plus workers over the past couple of years and we’ve been very successful in hiring a good-quality workforce.” That plant, too, has been able to source most new factory workers from within the region.
Kaltenberg believes being an employer of choice creates the added benefit of allowing the company to attract many people who already have the skill level the company needs. That allows corporate training efforts to immediately build on that knowledge and to tailor it to specific practices used in the plant.
The level of experience, though, has varied a lot among the overall group of new hires at the Jackson plant. Dykema has noticed those with farming backgrounds tend to arrive with more mechanical knowledge than their urban cousins.
“The younger folks we’re seeing have less mechanical aptitude than a generation ago,” says Dykema. “Some of us grew up fixing our own cars or bicycles. There’s a little bit less of that now, but people who are on the farm still, generally, are involved with repairing their own equipment. So I hope we continue to be able to draw from people who have some farm involvement, because they seem to have more mechanical aptitude. They certainly are more in touch with how the end user benefits from our equipment.”
Lack of mechanical skill among any new employees means spending more time, effort and money on training. At the same time, new equipment is becoming more complex, driving the need for training to ever-higher levels, and keeping the workforce up to speed with technical advancements and new manufacturing processes is what Dykema sees as the biggest challenge for Jackson’s workforce overall. “In all technical areas, we’re really becoming much more complex,” he says.
Because of the variety of tasks each assembly line worker needs to master, craftsmanship is still a key element in building farm equipment. That sets assembly plants in the ag industry apart from those in the automotive sector where more workers tend to do fewer tasks on the line, which means they can get by with less training.
Unlike automotive assembly lines that pause for only a few minutes for a single process, those in the AGCO facilites stop for longer intervals at each station, and each worker has a broader range of functions to perform. There is also a greater variety of models and machines coming down the line in farm equipment assembly plants than in those building automobiles. That minimizes the amount of specialization possible, so workers need a broad knowledge base.
“Our product moves at a lot slower pace than what you would see in automotive (plants),” says Kaltenberg. “Our employee has a lot more variety in what he does than someone on an automotive line. That variety requires a higher-skilled employee.”
At the Jackson plant, Dykema says future training objectives will give workers even higher levels of competence by giving them a chance to better understand the machines they’re working on. “We want to get to that point in the near future that everyone has a chance to drive the equipment, see what we’re building and why, and to see how it’s used.”
However, that training target will require some advanced planning and more immediate needs will have to be dealt with first. “The logistics of getting 1,200 people to drive tractors and keep it safe is a little overwhelming,” Dykema explains.
Both the Hesston and Jackson managers realize blending an employee’s need for job satisfaction with building technical competency are important elements in becoming “an employer of choice.”
“We try to have people move three to five stations up and down the line for two reasons,” says Kaltenberg. “One, to give them variety, and two, to have some flexibility. We like people to learn all the stations they can.”
The company also allows employees to take greater responsibility in the overall workings of the plant by using Kaizen events. This management practice relies on ordinary plant workers providing direct input into how operations are conducted inside a facility through a structured process.
“The Kaizen-event approach takes some workers out of their jobs for three to five days,” says Kaltenberg. “They step back and look at waste inside the operation. You pull people in from other areas. And that team, over the three to five days, identifies waste and makes changes. They come up with a plan, implement it and see how effective it is. The employees feel ownership of it because they came up with the plan.”
In the end, both Kaltenberg and Dykema believe it takes more than wages and benefits to attract top-quality workers and develop them into craftsmen while building corporate loyalty. “I think part of it has to be a challenging work environment,” says Kaltenberg. “They’ve got to enjoy the job and we try to create the right work environment to foster that.” CG