'Turbulent' US Economy Curbs $32bn Factory Training Efforts

The Manufacturing Institute (MI) estimates that manufacturers are currently spending US$31.9bn annually on internal and external training programmes.

This is an increase from US$26.2bn in 2019.

Efforts to ramp up training efforts are continuing according to the latest data in the MI’s State of Workforce Training in Manufacturing report, released in April of 2026.

However, the “turbulent economic environment" is having an adverse impact on training levels. ​​​​​​​

More firms are decreasing workforce levels compared to 2020 when the COVID-19 pandemic was ongoing.

Manufacturing training levels

Manufacturers in the US were asked about total annual spending on both in-house and external training for new and existing employees. 

Based on the responses, the MI estimates that the sector is currently spending US$31.9bn on training annually, an increase from the estimated US$26.2bn spent in 2019.

The survey found that 54.4% of firms were increasing current workforce training efforts and 36.9% were staying the same. 

A key finding is that the turbulent economic environment in the US appears to be having an adverse impact on training efforts. 

In 2026, a higher percentage of firms reported decreasing their training efforts than in 2019. Now, 8.7% of firms are decreasing current workforce training efforts, compared to 2.3% in 2019.

A turbulent economic environment

The US's turbulent economic environment has been driven by tariff measures and the US and Israel's war on Iran. 

According to the Federal Reserve's Beige Book, some US manufacturers are reporting uncertainty surrounding tariffs and the conflict in the Middle East as their firm's greatest challenge. 

US industrial production dropped 0.5% in March 2026 according to statistics published by the Federal Reserve. Likewise, manufacturing output ticked down 0.1% in March.​​​​​​​

Workforce levels in manufacturing

Fewer firms are increasing staff levels and more firms are decreasing workforce levels compared to 2020 during the COVID-19 pandemic.

The MI's most recent survey found that 36.9% of firms were increasing current workforce levels, 45.6% of firms were staying the same and 17.5% of firms were decreasing current workforce levels. 

In 2020, the same survey found that 43.2% of firms were increasing workforce levels, 40.2% were staying the same and 16.7% of firms were decreasing workforce levels. 

Obstacles and technical skills

One of the greatest obstacles to workforce training is that such efforts might interrupt work hours, as noted by 68.9% of respondents to MI’s survey. 

The survey asked manufacturers about the types of training that workers were engaged in. At the top of the list were job-related technical skills training at 88.4%.

This was also in the top spot of the 2019 survey at 84.6%.

Driving the conversation

A study by Deloitte and the Manufacturing Institute found that manufacturers will need to hire as many as 3.8 million workers by 2033. The study suggested that 1.9 million of those jobs could go unfilled due to a skills gap.

This skills gap could be offset by building a workforce who are prepared for the 21st century.

Google.org recently announced US$10 m in funding to the MI, designed to equip 40,000 current and future manufacturing employees with AI skills.

However, manufacturers will also need to be proactive to address this gap.

In a recent interview with McKinsey, MI's President Carolyn Lee said: “Manufacturers need to be driving the conversation, not waiting for the workforce ecosystem to arrive at their door. 

“We need to be front and centre, helping describe these opportunities and combating fears, including the assumption that AI will replace workers. Jobs will change, but workers will remain.”