Manufacturing Executives Cite Skilled Labor Shortage as Top Challenge, Shifting Investment Priorities
Event summary
- 79% of manufacturing executives identify skilled labor shortage as their greatest challenge.
- 90% report manufacturing departments are most impacted by labor shortages, followed by operations (48%) and design/engineering (40%).
- 69% of companies plan to invest in physical assets like robots and equipment, up 9% from 2025.
- Investment in operational systems (ERP, MES) dropped sharply to 33%, down from 60% in 2025.
- CADDi's 2026 Manufacturing Outlook Study surveyed over 200 U.S. manufacturing professionals.
The big picture
The manufacturing sector is grappling with a severe skilled labor shortage, compounded by geopolitical instability, tariffs, and rising costs. Companies are pivoting investment toward physical assets and AI-driven data solutions to extract more value from existing resources. This shift reflects a broader industry trend toward automation and smarter data utilization to navigate labor constraints and economic volatility.
What we're watching
- Labor Market Dynamics
- How the skilled labor shortage will affect manufacturing output and operational efficiency in 2026.
- Investment Priorities
- Whether the shift from operational systems to physical assets will deliver measurable output gains.
- Data Utilization
- The pace at which manufacturers adopt AI-driven data platforms to mitigate labor shortages.
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