Manufacturing and distribution industry leaders remain wary about the threat of potential inflation this year, but that factor decreases in significance over the next decade, dropping to just the fifth position in terms of long-term risks for a decade from now, according to a survey from the California consulting firm Protiviti.
After inflation, the top five risks that executives are tracking for the sector in 2024 include: the challenge of attracting, developing and retaining top talent; cyber threats; uncertainty surrounding the core supply chain ecosystem; and heightened regulatory changes and scrutiny.
In comparison, the same leaders ranked their top perceived threats for 2034 as: the ability to attract, develop and retain top talent; cyber threats; growing focus on climate change and sustainability; regulatory changes; and—finally—inflation.
The data comes from the firm’s annual “Executive Perspectives on Top Risks” study, which is produced as a survey conducted in partnership with NC State University. Researchers asked more than 1,100 board member and c-suite executives from organizations around the globe to rate 36 macroeconomic, strategic and operational risks.
According to the researchers, the challenge of attracting, developing and retaining top talent remains high on the list of risks manufacturing and distribution organizations face — an ongoing situation compounded by shifts in expectations among workers as well as succession challenges. Skills shortages continue to fuel low unemployment rates (in the range of 3%) throughout the industry. Specific manufacturing-heavy regions also continue to experience scarce talent availability — a persistent issue for organizations that have locations in more non-urban areas, making it difficult to compete with job opportunities in more popular urban areas.
The study also found that in a related finding, rising labor costs appear to be of less concern, having dropped in importance on the list of top risks for the industry group. Further, the decline is more pronounced than in other survey results, indicating a shift in the industry’s focus from labor cost concerns to broader challenges such as talent management, cybersecurity and supply chain resilience.
Ranked below the top five risk factors for 2024 were the remainder of the top 10: an inability to leverage rigorous data analytics for market intelligence and increased productivity; the adoption of digital technologies requiring new skills that are in short supply; geopolitical risks; and resistance to change.
