Labor Intensive Work and Analytics

There will continue to be labor intensive jobs, with key skills required. 

Labor-intensive factories—analytics-intensive productivity

April 21, 2021 | Article in McKinsey

By Manuel Gómez, Jorge Riveros, and Kevin Sachs

New analytics tools can help manufacturers in labor-intensive sectors boost productivity and earnings by double-digit percentages.

Amid the extraordinary transformation of manufacturing over the past decade as the Fourth Industrial Revolution (4IR) advances through sector after sector, some manufacturers still face a challenge almost as old as manufacturing itself: how to achieve lasting productivity gains from labor-intensive operations.

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The seemingly obvious solution is sometimes summarized as swapping labor for capital, in the form of automation. Despite the availability of ever-more-sophisticated machinery at ever-lower cost, in many situations a more attractive alternative is to use digital and analytics technologies to support people rather than supplant them.

Even today, labor-intensive sectors can include everything from toys, apparel, and jewelry to medical devices, consumer-electronic products, electrical goods, and automotive components. These sectors are a critical force in emerging economies, providing employment that reduces poverty and strengthens social stability.

Where labor is so instrumental in creating value, managing a workforce becomes a matter of strategic importance. Companies that perform better at hiring, retaining, and—most crucial of all—engaging their workers can build a substantial advantage over their competitors. To do so, they must overcome a host of challenges, some of which became even more vexing under COVID-19. Ensuring that workers feel safe must, of course, be the highest priority. But providing a protective environment may not be enough to persuade every worker to come into factories—particularly workers juggling responsibilities to care for children and families that may have been disproportionately affected by the pandemic.

Companies that perform better at hiring, retaining, and—most crucial of all—engaging their workers can build a substantial advantage over their competitors. ... '  ( 6 pages)