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Record Technology Investments Outpace U.S. Manufacturing Workforce Readiness, New Report Finds 

Another survey of manufacturing business leaders regarding applying AI in their operations and availability of a skilled workforce to apply it.

Revalize, a worldwide leader in CPQ, PLM, and CAD software solutions for manufacturers, released new research around the state of AI and smart technology adoption in the manufacturing sector. Despite ongoing economic uncertainty, the report finds that technology investment continues to surge, prioritizing AI and automation, yet many companies are struggling to find talent with the right skillsets to implement and deploy the technology effectively. Manufacturers must focus on streamlining systems and upskilling workers to leverage emerging AI opportunities and fully realize the return on these investments. 

The report, Smart Manufacturing 2026: Agile Leaders Confront the AI Skills Gap, features data gathered from a survey of 500 business leaders in select manufacturing fields across the United States, Germany, Austria, and Switzerland. The research reveals companies are investing in new technologies, but many are starting to face the reality that their workforce might not be ready for it.  

Key findings include: 

  • Technology Investments Continue to Rise: 77% of manufacturing leaders report increased software budgets over the past 12 months, up from 70% the year prior, signaling sustained momentum behind digital transformation. Additionally, 93% of manufacturing leaders plan to utilize new technologies, tools, or software this year. 
  • Holistic AI Adoption is Lagging Despite Lofty Goals: While 56% of manufacturers reported having implemented AI in select areas, only 10% said the technology was fully integrated across their operations, illuminating a critical gap in execution.  
  • The U.S. Has the Highest Demand for AI Skills: U.S. manufacturers lead investment in AI-driven and human-centric Industry 5.0 technologies, creating the highest demand for AI skills among all countries surveyed. As a result, 44% of U.S. teams cited a need for AI expertise, 16% higher than other regions. 
  • Industry 5.0 Confidence Remains High, but Realism Grows: 84% of manufacturers feel prepared to adopt and leverage Industry 5.0 technologies, a slight decline from last year, reflecting a more realistic understanding of the integration, data, skill, and workforce capabilities required for success. 

“AI and automation are transforming the manufacturing sector, but without serious investment in workforce training to leverage these technologies, initiatives fall short of expectations,” said Mike Sabin, CEO of Revalize. “The industry’s continued technology investments must be matched by a commitment to upskilling talent through both internal programs and external academic partnerships. I foresee 2026 as a pivotal turning point where manufacturers will either move beyond AI hype and take the necessary steps to bridge the gap between investment and readiness or fall behind as competitors move faster toward Industry 5.0.” 

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Mentor In A Pocket

Articles about a worker shortage due to Boomer retirements have been a staple of trade magazine editorial ever since I became an editor in 1998. Some twenty-seven years later, those articles and news releases keep coming.

The concomitant problem is how to bring new people in. Apprenticeship programs went out the window with World War II. Businesses and manufacturers began expecting the education system to supply appropriately skilled workers. This was not going to happen despite education systems becoming increasingly industrialized. They taught basic math. Taught kids how to sit still and follow directions. Taught them to show up every day at the required location.

We need more.

It’s taken me some thought to place this new product from Derek Crager, Founder & CEO of Practical AI.

There is irony here, in that Crager touts himself as developer of an award-winning training program at Amazon—yes, the place that thinks it can replace its workers with robots. But, we will go beyond that thought for now.

I’ve not read the book, but he has also released a new book, Human First AI.

Crager says the real cost is downtime, rework, and attrition. He continues, It isn’t just a staffing problem—it’s an OEE problem. Every knowledge gap shows up in the metrics leaders actually manage: MTTR, FPY, scrap, rework, and yes, attrition. Ask any maintenance manager: the fastest way to lose a promising hire is to strand them without support on a tough job at 2 a.m. We send people to training, hand them SOPs, and hope they remember when it counts. But memory fails—especially under pressure.

His solution? Just-in-time guidance—the right step at the exact moment of need, while hands are on the task. When a technician can ask and do in the same breath, training becomes throughput. That’s the difference between teaching a concept and multiplying your best expert across every line and shift.

He called on his experience at Amazon to develop something called Pocket Mentor: A Phone Call to Your Best Expert. This is a hands-free, eyes-free mentor your team reaches by phone, anytime, on the floor or in the field. No app. No Wi-Fi. No passwords. Just tap & say, “Talk me through it” — and we will.

Here’s how it works:

  • Capture once. We sit with your best people and harvest SOPs, changeovers, fault trees, “what-if” branches, and tribal tricks—the real decision trees pros use when the line’s on fire.
  • Validate and govern. Content is approved by your SMEs and version-controlled with human-in-the-loop QA. Your source knowledge stays in a secure, governed box; people approve changes before they go live.
  • Guide in the flow of work. A tech calls in, we ask two clarifying questions (model, symptom), then deliver step-by-step voice guidance they can follow while working—hands-free — eyes-free.
  • Optional enterprise integrations. We can use your digital-twin/IoT signals today (enterprise integration) to pre-fill context—e.g., “Given Code 47 and 200 service hours, here’s the fastest fix; want me to talk you through it?”

He cites this pattern of stats.

  • Up to 80% faster onboarding—because new hires can “tap & say” from day one instead of waiting for a veteran.
  • ~30% reduction in downtime/rework—because the right step shows up at the right time, not after the post-mortem.
  • ~53% lower early attrition—because nobody wants to feel alone on the line; support drives retention.
  • 30× impact vs. traditional training—because we replace recall with real-time execution.
  • 0 extra staffing to scale coaching—your best employee effectively becomes 20 or 50 virtual coaches, every shift.

Most project managers agree that you should start with a specific pilot, prove the system, then scale it out. Crager offers a few suggestions.

  • Pick a chronic stopper. The two or three faults that always cause headaches (and overtime).
  • Harvest the fix. Sit down with your A-team and capture the real-world fix path—model variants, hard-won “gotchas,” and the restart checklist nobody remembers at 3 a.m.
  • Go live by phone. Give your night shift a number to call. Let them say, “Talk me through it.”
  • Measure MTTR for 30 days. Compare to your baseline. Then expand to changeovers, start-of-shift checks, and training-intensive stations.

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Automation of Workflows Drives 20% Increase in Productivity

Note: I had an allergy attack following my California trip that wiped me out for a few days last week. Now trying to catch up with a number of thoughts.

’Tis the season of surveys and reports.

Actually, that season has become about as year-around as Christmas and Halloween. Once the province of pharmaceuticals, companies commission surveys and report on the ones that support their place in the market.

Not to be entirely cynical—technology supporting the front-line worker has been burgeoning over the past few years. Perhaps this was accelerated by Covid pandemic increasing remote workers? I don’t know. 

The other interesting tidbit concerns Zebra Technologies, sponsor of this survey (companies call it research, but given my grad school courses, I balk at that description), has grown through some acquisitions from the company I knew (and sold a couple products) in the 90s.

Oh, and they had to throw AI into the mix. It’s up to you to figure out what they mean by that.

Zebra Technologies Corp. announced new research in collaboration with Oxford Economics. The study showcases how improving frontline workflows with modern technologies like AI, automation, and data improves profitability and enhances the customer experience. 

Retailers reported a 21% improvement in customer satisfaction, manufacturers cited a 19% increase in employee productivity, and T&L leaders reported a 21% increase in productivity with better workflows. In addition, the study indicates AI investments help organizations achieve real-time visibility, generate actionable insights and improve efficiency.

Companies surveyed said they were using (unspecified) AI to address loss prevention, risk detection, inventory optimization, inventory management, demand forecasting, and predictive analytics—all typical machine learning technologies that have been around for a while.

They also noted using tools that have been around for years, although greatly improved since I sold and installed them in the 90s—RFID and  machine vision.

The news release touts Zebra’s new brand narrative, “Better Every Day” affirming the company’s commitment to empower organizations with automation and AI to create new ways of working that make everyday life better.

Good-boss friendly

I have had some good bosses and a bunch of bad ones. I tried to be a good boss, but I bet there are some people who worked “for” me that would dispute that. As a soccer referee assigner, I try hard to be fair while also putting officials on the games where they would be most likely to succeed.

From Seth Godin, who talked about being the type of person that a good boss will appreciate. Hopefully you have one of those. If not, I wish you luck in leaving and finding a good one.

He compiled a list of attributes. I would suggest not looking at this like a check list. It’s more of a description of a type of person.

Are you now, or can you develop into, this type of person? I try…

  • Ask useful questions
  • Show up before you’re expected
  • Make big promises and keep them
  • Identify errors and flaws and self-correct
  • Default to optimism
  • Do work worth doing
  • Build a useful network worth outsourcing work to
  • Show your work
  • Develop good taste
  • Generously invite feedback
  • Make productive decisions
  • Communicate with precision
  • It’s easy to claim these skills, but not easy to commit to being quite good at them.

Seth concludes, “Most bosses don’t deserve this level of effort. I hope you can find one that does.”

Skills or Education

I saw an article about jobs in The New York Times (it was long enough ago that I’ve lost the link).

It started with the premise College graduates, on the other hand, often do not have the right skills to be successful on a factory floor.

I find that a completely bogus argument. Someone who truly educated themselves at university should have learned essential skills for living such as how to research, how to think, how to write coherent thoughts, how to communicate. They should have some math and science, as well as some literature and philosophy.

Speaking as someone with that above education who also worked on the factory floor in one function or another for about 20 years, the failure lies elsewhere. Probably in expectations.

Try this statement presented as one of an n=2 examples (journalism):

The country is flooded with college graduates who can’t find jobs that match their education, Mr. Hetrick said, and there are not enough skilled blue-collar workers to fill the positions that currently exist, let alone the jobs that will be created if more factories are built in the United States.

Society has spent about 50 years telling young people to a specific training at university and then get a nice, cushy white collar job leading to CEO within 15-20 years, if not sooner. Unfortunately, the markets and economy did not cooperate with these predictions.

This initiative, however, does directly address a flaw in our system.

The Business Roundtable, a lobbying group whose members are chief executives of companies, has started an initiative in which executives collaborate on strategies to attract and train a new generation of workers in skilled trades. At an event last week in Washington, executives commiserated about how hard it was to find qualified people and swapped tips onstage for overcoming the gap.

My grandfather taught me a lot about manufacturing before I was even 10 years old. He talked about being forced to drop out of high school (about 1915) and apprenticing as a machinist at the old Monarch Machine Tool Company. He had a number of jobs with increasing responsibility and opportunity. During World War II he was a production superintendent in a GM plant that was converted to the manufacture of aircraft machine gun bolts. He employed a number of strategies that I later learned were similar to Lean Manufacturing. GM sent him to take college courses while he worked for them. (OK, you win, this is n=1; adding me, the journalist n=2.)

Their ideas included combing through existing company job descriptions to prioritize relevant experience over college degrees and recruiting high school students as young as sophomores for experiences that could draw their interest in manufacturing careers.

“For every 20 job postings that we have, there is one qualified applicant right now,” said David Gitlin, the chairman and chief executive of Carrier Global, which produces air-conditioners and furnaces and services heating and cooling equipment.

By the 1960s companies had farmed out their apprenticeship programs demanding public schools to provide compliant workers. The public school skills training programs thrived to a degree, but also faltered under parental wishes for their children to become rich, college-educated people.

I believe university education (short of PhD track) even in technical training such as engineering really exists to help a willing individual learn to research, think, write clearly, and acquire a background deserving an educated person. Where they work? Well, that’s up to serendipity and drive.

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