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The A&P Mechanic Shortage A Global Affair

Earlier this year, I was asked to attend a workshop discussion on “The Shortage of A&P Mechanics in the Workplace.” The workshop was hosted by Turbomeca and representatives from Safran, Pratt & Whitney Canada, Eurocopter, AgustaWestland, Bell, Sikorsky, Air Methods, Bristow, Honeywell, GE and Total were in attendance. I am sure that I have forgotten a company and for that I apologize. It was an impressive get together and there was a tremendous amount of expertise and time served in our business represented. What I found to be most interesting was the fact that most of us work for companies in the U.S. We have known for a while that we were encountering a shortage of A&P mechanics … but we are not alone. The problem is a global one.

Here in the U.S., some things might be getting worse as the economy gets better. That’s how it appears as the helicopter industry starts to emerge from a recession and a search begins for skilled labor to fill the growing number of openings. The Vietnam-era A&P mechanics are retiring and they are taking all of their expertise with them. I remember the company that was looking to hire an engineer with the following qualifications: 27 years old, Ph.D. in computer science and 10 years of experience. Good luck! We face a similar problem in the helicopter industry in that employers want to hire personnel with two, three, even five years of rotorcraft experience, and that is becoming more difficult each day. There are ways the industry can address that, but that comes with a whole set of other issues and can be covered in another article at a later date.

We tend to forget that things started to go south back in 2001. Thousands of skilled workers that were hired during the boom days of the late 1990s were laid off as struggling companies down sized to meet the drop in customer demand for their products. In mid-2006, the economy was righting itself and business aviation followed suit. Many of those skilled workers who were let go during the down sizing didn’t come back when things got better. Some had found other work in areas where the same skills were in demand, others retrained for new careers in different fields, and still others left for more stable, if not greener pastures.

The competition for skilled labor became intense. Duncan Aviation, a family-owned-and-operated MRO that had long taken pride in the fact that it had never laid off an employee in its 55-year history, implemented a reduction in force that affected 306 positions. Wichita alone, long the self-described air capital of the world, saw a combined total of nearly 13,000 workers laid off by the various aircraft OEMs and their vendors.

These workers had a skill and wanted to use it. If it was not needed here in the U.S., then they went where it was needed, predominantly the Middle East, China and India.

These are definite growth areas for business aviation and for skilled experienced A&Ps who can command salaries that are quite good. There might also be considerable tax advantages.

Now we see that the workplace is dealing in human capital and that it is not cloistered to one country, but is evolving on the international stage. With this thought as a backdrop, Turbomeca set the stage for our discussion. It hired the Manpower Group to do the research for the discussion.

Here is a brief synopsis of what was presented and discussed at the workshop. The information was based on 2013 first quarter information.

Hiring

Hiring in Europe continues to deteriorate while it remains on the steady pace that it has been on since the last quarter of 2012 here in the U.S. Employers in 13 countries reported negative first quarter hiring plans. This is an increase from eight countries in the last quarter of 2012. Employers in Taiwan, India, Brazil and Mexico report the strongest hiring plans that are all in double-digit territory. The weakest hiring expectations are reported by employers in Greece, Italy and Spain. They are all negative by double digits.

According to Jeffrey A. Joerres, Manpower Group chairman and CEO, “Worldwide, businesses are hesitating with investments due to uncertainty and this includes their investment in talent. In Europe, more companies are telling us they will cut staff to adjust to weaker demand. In fact, employers in seven European countries are reporting their weakest forecasts since we have been tracking hiring trends. We do see a few bright spots. U.K. employers are reporting the strongest outlook in four years and the German market should remain steady.”

Difficulties

The aviation industry as a whole has a set of difficulties/challenges that might or might not surprise you. Of those looking to hire people, here are the top reasons and percentages that prevented employers from filling positions:

• Lack of talent – 33%

• Lack of technical competency – 33%

• Lack of experience – 24%

• Lack of employability – 18%

• Looking for more money – 13%

• Unwilling to work part time – 4%

• Did not want to work at that location – 4%

Overall, it appears that the key drivers for these difficulties are demographics, talent availability, population growth, change in technology and the speed at which that change is occurring.

The Top 10

With all that said, here is a more detailed analysis of specifically what positions in the aviation industry are the most difficult to fill:

No.1  Skilled trade workers– A&P mechanics and avionic specialists head this list.

No.2  Engineers – Less people are studying engineering disciplines. Perhaps they find the curriculum too difficult or they just don’t want to apply themselves. On the other hand, it is getting more and more expensive (at least in the U.S.) for a four-year college education.

No.3  Sales representatives – Most companies are looking for individuals that have a college degree and have good communication skills.

No.4  Technicians – This is like No.1 above. To be fair, salary plays a large part here. In order to attract good help, you have to offer good pay and benefits. Too many companies operate on margins that are so slim that they cannot offer to pay much.

No.5  IT staff – There are two issues here: one is salary and the other is outsourcing. How many times have we had a problem with our computer, software or something else, and even though we dial a number for the U.S., we get connected to a person in another country? That means that the IT function is being handled on a scale that pays about one-third to one-half what we would pay for that same position here. There is not much of an incentive to look for an IT position in the U.S.

No.6  Accounting and finance – Most individuals with degrees in this field are looking for jobs at large corporations, financial institutions and Wall Street. Not too many people are looking to work for small companies in the aviation industry.

No.7  Drivers– This might surprise you as this is not a highly technical position … but the problem here is pay and benefits. This is usually a part-time position and the pay and benefits are commensurate with that.

No.8  Management and executives – Surprise! Large aerospace OEMs and vendors are not having the problems here. It is the smaller companies that do not offer the pay and benefits individuals in this category are seeking.

No.9  Laborers – This covers the work group of janitorial services and others. This job is usually offered as a part-time position with low pay and no benefits.

No.10  Secretaries, PAs and administrative office support staff – Here the problem is a sign of our times. People have poor to non-existent communications skills and do not work well without constant supervision.

Overcoming the Shortages

What can an employer do to overcome these shortages? How can an employer fill the positions they need to fill with good, solid, qualified individuals? Here are a few strategies that could be used:

Provide additional training and development to the existing staff. With few exceptions, people like to improve on what they know and do and move up within the company.

If the employer cannot find the talent they need locally, broaden the search to a larger area. Even national and international arenas could be considered, depending on the position to be filled.

In areas where recruitment is proving to be difficult, it is probably as important to not lose the talent you already have as to finding new talent. The employer should consider what could be done to improve talent retention.

Increase starting salaries. Finance always has a tough time with this one. If you really need to fill a position, perhaps sweetening the pot with a few extra dollars would help.

Enhance benefits and perhaps offer a signing bonus. My daughter is an RN and her field of expertise is oncology. There is a demand for her skill set and rest assured that the major hospitals all offer signing bonuses to attract talent such as hers.

Global Conclusions

Individuals with in-demand skills will become more selective as they evaluate their employment options, compelling organizations to develop better recruitment and retention strategies.

Talent shortages will force organizations to adopt a new mindset regarding talent development up-skilling their existing employees, and developing candidates with potential becomes the norm rather than the exception.

Organizations appear to be more comfortable and adept at conducting business in an uncertain environment where systematic shortages of talent persist.

That growing percentage of employers who indicate unfilled positions are expected to have little or no impact on key constituents is surprising; this finding could be revealing a new normal.

Many organizations have emerged from the challenges of the recession operating at new levels of efficiency and are reluctant to add employees at greater expense, or without proof that additional talent will provide long-term benefits.

Companies that maintain a longer-term view that realizes their talent will differentiate them from their competitors will likely gain a major competitive advantage over those that choose to put talent management on the back burner.

The Good News

The MRO industry segment employs 480,000 people within more than 4,800 firms with growth estimated to reach $55.2 billion by 2015.

The U.S. makes up 42 percent of all employees and 88 percent of firms, most of which are small to medium in size.

Key drivers for growth include the need for maintenance of aging fleets and the expanding Asian market.

The MRO segment includes more than 290,000 technicians, 24 percent of which are FAA certified.

Rotorcraft and business jets represent about 21 percent of total revenue within the global commercial aircraft manufacturing industry.

Demand for aircraft within this industry is more volatile than demand for large and regional aircraft.

Fleet growth for helicopters is forecast to be more than 13,000 from 2012 to 2022, and to almost 21,000 from 2023 to 2033.

How are Companies Dealing with the Mechanic Shortage Today

• Not hiring new mechanics, but dealing with the mechanic shortage by utilizing current supply

• Partnerships with companies, governments and educational institutions

• Initiating internship and apprenticeship programs

• Utilizing supply from incoming military mechanics

• Incorporating temporary workforce from companies such as Manpower — use of contract workers in the industry has increased from 5 percent to 7 percent during the last five years.

Best Practices

Here are some of the best practices being used by companies today to help alleviate the shortage of mechanics.

• Partnership with technical schools

• Partnership with government

• Round-table discussions to advance the aerospace technical workforce

• Manufacturing Institute, National Center for Aviation Training and industry partners

• Creation of new training — Manufacturing Institute and aerospace employers

The Future of Aircraft Maintenance

The future of aircraft maintenance can be divided into three parts: mechanics, schools and industry.

Mechanics – They will need to continually develop new skills to accommodate new-generation aircraft. Some career opportunities might be overseas, which leads to the need for language and culture training.

Schools – Their staffs will need to increase online, mobile and digital technology training to match the learning needs and expectations of a new generation. New-generation aircraft will require different maintenance skills. The growing diversity of the student base requires instructors with cross-cultural and cross-generational skills.

Industry – Companies, governments, educational institutions and non-profit organizations need to come together and cooperate to address the issues at hand. Emerging markets currently recruit trained personnel from outside their regions. In the future, they will need to develop their training requirements locally.

The problem of talent shortage in all disciplines is a global concern. If you are having a talent problem at your company, it is a small consolation that you are not alone, but it might make your company more aware that the competition for existing talent is stiff. You might have to up the ante, so to speak.

Do you know if your company is looking for talent, or has a program or programs in place to address the problem? If you can share that information with us, please do so. If you allow it, we will share it with our other readers.