The Impact of Labor Shortages on the Manufacturing Sector and How MRP Can Help

Attracting a quality workforce is currently one of the most significant challenges facing the manufacturing sector. With labor shortages forcing many to accelerate their investment in new technologies, companies are turning away from their old ways of doing things and looking at tools like MRP as their bridge to the future.

Despite their best efforts, one survey released at the start of 2022 highlighted workforce challenges as a major concern for US manufacturing firms.

Approximately 93% of respondents in “The Manufacturing Experience: Compensation and Labor Market Competitiveness” report said that they are experiencing difficulties finding qualified applicants to fill open positions, while almost 90% have increased the level of compensation on offer to attract and retain staff.

Nearly 66% of manufacturers were responding to the workforce shortage by utilizing temporary staffing services more frequently – a costly solution long-term. Internal training programs were also common, with 61.1% saying that they had created or expanded these programs at their company.

The benefits of material requirement planning (MRP) software

Whatever attraction and retention methods a business puts in place, the implementation of specialist software can streamline key processes and reduce the number of people required physically on the production floor.

A Material Requirements Planning (MRP) system can help better plan, schedule, and manage your inventory at every stage of the manufacturing process, making sure raw materials are available for production when required.

More accurate inventory management

With the sector continuing to evolve, the ability to manage larger or more complex inventories has become increasingly important. This task is incredibly labor intensive without the right technology in place. Via a specialist MRP, inventory management can be streamlined, with production planners able to view the material supply and demand information on screen and, if required, drill into the details.

Similarly, they can view the material-on-hand balance for each batch or production run to avoid material shortages and prevent order delays.

Improved visibility

The implementation of a specialist MRP – especially one that is a native component of your existing ERP system, will improve visibility between departments and significantly drive efficiency. Once a piece of information is entered into the system, it’s stored centrally and can be accessed by any department that might need it. Not only does this increase data accuracy and completely remove any duplication, it will help the entire production line run more smoothly.

By leveraging data provided in MRP reports, teams can also work from accurate information around order lead time, due to ship, due to dock (intercompany transfers and purchase orders), and job planned start and planned finish dates. Those attempting to manage all of these processes via disjointed systems or manual processes are likely to fall victim to oversight or error – potentially creating more work for an already stretched team.

With labor shortages showing no sign of easing, having the right technology in place to ease workloads and enhance productivity is vital for any manufacturing business looking to grow.

Contact us today to learn how Deacom can help your manufacturing business overcome the impact of labor shortages.

About the author

Demand Generation Manager - Deacom at

Domenick Naccarato has been a featured writer on the Deacom blog for the past 7 years sharing his insight into manufacturing best practice techniques, conversations with customers, and videos of Deacom ERP experts and users.