Fool's manufacturing view akin to Witty's of GSK

The worst of the manufacturing fallout could well be over, touts Motley Fool contributor Morgan Housel. After manufacturing job declines in 27 of the last 41 years, "productivity growth [from automation and outsourcing] looks topped out, and increased shipping and labor costs have diminished Asia's competitive advantage," he says.

Housel is talking about the manufacturing sector in general, but he zeroes in on the drug-making business. He cites the experience of Ben Venue Laboratories last year, when the contract manufacturer saw 3,600 job applications on the way to making just 47 hires.

Many Ben Venue applicants failed basic reading and math tests. But at other pharma manufacturers, production positions remain open because of a lack of qualified candidates beyond this basic level. Yet given the plant closings and layoffs of the last few years, there should be a surplus of pharma manufacturing talent.

But that appears not to be the case. Decades of small-molecule manufacturing experience are largely nontransferable to bioprocessing. And newer manufacturing operations--whistling with robotics and automation--can seem foreign to those who have spent most of their careers with just one or two manufacturers.

Genzyme, now a unit of Sanofi, is in the midst of a hiring push that includes production personnel. Some of the more than 150 manufacturing and development openings it posted in April were more than a year old. "Some roles are more challenging to fill than others--those with a highly specialized technical skill set, or some senior leadership positions where we are looking for both the leadership capability and experience working through our specific business conditions," spokesperson Erin Emlock told us then.

GlaxoSmithKline CEO Andrew Witty (photo) pronounced last week that the West is fully capable of competing with the East in manufacturing. "[W]e ought to be challenging ourselves to demonstrate that Western sites can be absolutely the most efficient and innovative," he added. Doing so will first require an operations force that has the right skills or the drive to get them. - George Miller

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