Partner's Corner: The Fourth Industrial Revolution
November 14, 2016 | By Karsten Heise, Director | Technology Commercialization, Nevada Governor's Office of Economic Development
When we talk about Manufacturing we often hear about repetitive manual tasks on assembly lines, shifting production offshore to Asia or – more recently – moving back to the United States, automation and the replacement of workers by machines is being mentioned, and concerns about shortages of skilled workers in an industry that exhibits a relatively high average employee age is being raised, to name just a few common perceptions. It would be appropriate to revisit some of these perceptions by highlighting current developments indiscriminately affecting the manufacturing sector globally and what these trends mean for workforce development.
The overarching mega trend impinging on manufacturing today and in the foreseeable future can be summarized by the term Fourth Industrial Revolution. This trend is being reinforced by the aftermath of the Great Recession 2008–2010 and its subsequent impact on globalization, which is affecting manufacturing-location decisions.
The Fourth Industrial Revolution can be described as a fundamental shift in production, consumption, and human interaction in general. This shift is driven by the convergence of the physical world, the digital world, and human beings. Its potential impact is so profound that it presents a cataclysmic shift in the future of work, education, and skills within all industries, but particularly pertaining to the manufacturing sector. Unprecedented in history, this impact will play out over approximately the next 20 years, a time-span representing a single generation, in stark contrast to previous industrial revolutions, which eventuated over the course of three to four generations while impacting less industries and workers.
In addition, contrary to frequently cited substitution of workers by machines, with the correct long term investments in developing skills linked to fields in Science, Technology, Engineering, and Math (STEM), a highly technically skilled and digitally literate workforce will be conducting their tasks alongside smart machines (such as ‘Cobots’), thereby augmenting technology rather than being replaced by it. Simultaneously, while up-skilling and training a workforce in digital technologies and applications, ‘softer’ interpersonal skills will grow in importance.
The foremost application in manufacturing of this digital transformation inherent in the Fourth Industrial Revolution has been termed Industry 4.0. This concept utilizes the three main current technological innovations of Automation, Internet of Things (IoT), and Artificial Intelligence (AI) in order to devise and implement novel industrial and economic models leading to a shift in the economic paradigm. Physical assets are being seamlessly integrated into the information network. The Internet will enable the combination of sophisticated intelligent machines, production systems, and processes in order to form a complex smart network linking all productive units in an economy.
This next industrial transition is not about increases in volumes to lower costs, but customization of products and services, described as mass customization or ‘lot-size 1’. Production will again be placed in advanced industrialized countries such as the United States. A slowing pace or even potential reduction of the process of globalization is meeting the described increased speed of digitization. Locations closer to markets and supply chains characterize the new regionalization of production. Given these trends, what are the consequences for workforce development in Manufacturing? First, uncertainty will replace the currently existing, relatively smooth transition from education to employment, as there can be no foresight into what the jobs of the future will exactly look like. Exacerbating this uncertainty is the fact that education by definition assumes a long-term commitment to a future occupation. Furthermore, uncertainty about what jobs of the future will resemble indicates that a widely diversified talent pool is required. Second, skills rather than traditional job descriptions become a foundational block in formulating future workforce and human capital strategies.
Third, as knowledge becomes obsolete at a faster pace, getting accustomed to and developing the ability of ‘learning to relearn’ is becoming increasingly critical through lifelong learning. The implication is that leaving the workforce for obtaining further training will become progressively harder resulting therefore in blending together education and full-time work to become the education model of the future. Fourth, the shift towards regionalization of production reinforces the importance to launch workforce development initiatives right now.
The Nevada Governor’s Office of Economic Development (GOED) has been spearheading with its partners the creation of Career Pathway Frameworks. Termed Learn and Earn Advanced career Pathway (LEAP), these frameworks are being developed by applying international as well as national best practices to address the fundamental consequences of the Fourth Industrial Revolution described above. The frameworks consist of multiple fully integrated, highly flexible pathways within which credit transfers seamlessly with no gaps from High School to College and University. Career Technical Education (CTE), through developed standards that are applied across Nevada and associated High School certificates, form the common foundation of every pathway within the frameworks.
Each element of the pathways will lead to qualifications associated with a set of defined skills. Hence, employers will understand the associated skill set of every certification or degree and can therefore better assess potential employees’ abilities. LEAP-style frameworks will respond to the increasing demand of continuous life-long learning while remaining in employment supported through the implementation of progressive educational delivery models (such as Open-entry/Open-exit) that meet the needs of industry and adult workers forming “on” and “off” ramps within the LEAP-frameworks.
Input from manufacturers is crucial. We have therefore developed an employer engagement process. Through this process manufacturers will be informed of and fully understand the skill sets that Nevada students and adults can obtain. All elements within each pathway will be reviewed by employers leading to endorsements of LEAP frameworks and its elements as preferred hiring qualifications. This engagement process is dynamic, with employers convening on a regular basis in order to ensure workforce skills remain up to date.
GOED, with its partners in manufacturing as well as with educational providers and other state agencies, is meeting the increasing challenges of the Fourth Industrial Revolution by creating fully integrated career pathway frameworks (LEAP) to produce the highly skilled workforce that will enable us to write the next chapter of manufacturing in Nevada.
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