Digitization is bringing back jobs by relocating manufacturing

Digitalization, spurred by advances in cellular connectivity, is coming to manufacturing. This helps make leaps and bounds in productivity, flexible operations, worker safety and even sustainability.

But as industry adjusts to new realities arising from the COVID-19 pandemic, another benefit of digitalization being explored is how technological advances such as automation and the Industry 4.0 movement are helping to relocate manufacturing jobs and increase competitiveness.

Industry 4.0 lays the foundation for relocation

For the industry, the pandemic has made it clear that overseas manufacturing is extremely vulnerable to disruption. One of the results of this realization is that companies are considering bringing back some of the jobs and production capacity from abroad. But that will depend on reshaping what manufacturing looks like through technology.

Along the same lines, the pandemic has also accelerated digitalization efforts that are slowly but surely coming to manufacturing. Industry 4.0 is an umbrella term, describing the significant transformation occurring in the way goods are packaged and delivered, and the move towards automation and more flexible industrial production.

Technology can be a major enabler in solving some of the supply chain, production and workforce industries facing the industry. In a recent survey, 94% of companies said Industry 4.0 practices helped during the pandemic, and more than 50% said they were essential to the pandemic response.

This is a critical time for the industry and for people who want to see these jobs relocated. And digitization, including automation, can help manufacturers take advantage of some of the efficiencies that have driven offshoring in recent years, while helping to make the supply chain more resilient to potential future disruptions.

Shorten the supply chain

Generally, there is some trepidation about the automation of manufacturing jobs, mostly centered around the idea of ​​workers being replaced by robots.

Workers have felt the disruptions of the past few years and any concerns about the future are understandable. But we shouldn’t overlook the positive benefits automation can bring to manufacturing workers and the industry as a whole.

The fact is, automation is affecting jobs globally. For example, over the past 10 years, China’s manufacturing industry has grown by 6% compared to a 0.4% increase in the United States. This is due at least in part to automation technology, which China is adopting much faster than other regions. So, to some degree, embracing more automation in places like the US and Europe is necessary just to keep pace with the rest of the world. This is an efficiency gap that must be closed if manufacturers are to succeed in bringing factories and jobs closer to their home markets.

Automation, especially when paired with AI/machine learning, can help. At Ericsson’s smart factory in Lewisville, Texas, where connectivity comes from a state-of-the-art 5G network, we put these principles into practice – shortening the supply chain by bringing equipment closer together to the deployment of the 5G network in the United States from where it will be deployed.

Closing the efficiency gap with private networks

And the technology enables incredible efficiencies in the installation itself. An asset tracking solution digitally integrates with plant sensors to track the location, condition, and status of critical assets in real time. The solution provides real-time visibility of finished products on the production floor and had an immediate impact: a 10% increase in repair technician productivity and a 5% reduction in rework and waste.

Also in Lewisville, maintenance technicians are using virtual and augmented reality headsets to help experts focus on issues, even if they are not at the same facility. The result: a 10% decrease in plant maintenance labor and a 5% decrease in equipment downtime due to more efficient troubleshooting.

All of this reduces the cost reductions that initially spurred the offshoring movement, plus the added benefits of keeping the supply chain concentrated in the US and minimizing disruption.

These solutions are powered by a robust and secure private network. The Lewisville network is a 5G network combined with a 4G/LTE network, but in most cases the characteristics of the use cases determine which technology is best suited to the connectivity needs of the facility. Additionally, LTE networks have the ability to seamlessly transition to 5G.

Private cellular networks bring several features that will enable relocation-enabled use cases. Compared to Wi-Fi, not only are networks more reliable and efficient (delivering more power with less equipment around the plant), but cellular networks are less susceptible to interference and give plant managers the ability to prioritize data traffic towards key operations such as security functions. through network slicing.

Upskilling is key to bringing manufacturing jobs back

There are other benefits, enabled by the robust connectivity of private networks, that can help justify relocating manufacturing. Automation contributes to better volume production and a digitized factory provides increased flexibility in the field. A more nimble factory can customize to produce parts locally, essentially shortening the supply chain and eliminating the need to travel overseas to find a specific part. Digitization also enables faster modernization of existing plants and processes, again mitigating the need to send work elsewhere.

While networks will be the backbone of technologies enabling relocation, it is not just about technologies. New skills will be needed for the workforce, being the extension of the digital design process. As heavy industry goes digital, the idea of ​​what it means to be a “blue collar” worker will be redefined. Processes involving AI on the factory floor will require people in the field who can take data and make sense of it in real time – a different skill set than an analyst sitting in an office elsewhere. The retraining of workers is an essential element of the relocation movement. Technology that accompanies digitalization will create 2.1 million new jobs, according to the World Economic Forum. But workers currently in manufacturing will need to upgrade their skills to compete for these new positions. Computer skills will be particularly important, however, it will not be necessary to employ engineers for the factory. And again, robust connectivity can play a role in training, enabling remote training and virtual drills to prepare workers for the future.

Overall, digitalization represents a tremendous opportunity to relocate manufacturing jobs overseas. Factories with reliable, fast, and secure digital connectivity — especially cellular private networks that can protect data and focus traffic on critical functions — will enable the productivity and efficiency gains that can bring those jobs back.

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Learn more about Ericsson’s Smart Factory in the United States

Smart manufacturing with seamless connectivity

Unlocking the value of Industry 4.0 with 5G

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About Bob C. Zoller

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