How to combat rising labour costs in the metalworking industry

Offshore oil & gas labour costs

Labour is an extremely valuable resource in many markets, but especially where automation can’t replace a skilled workforce, such as operators in the metalworking industry. Yet, in the last few years, skilled labour has become scarcer just at the time when it’s in greatest demand.1 This imbalance has led to higher labour costs, meaning many companies struggle to attract the right operators or cannot grow the workforce in line with increased business activity.

There’s no doubt that labour costs represent an increasing outgoing in many labour-intensive industries, particularly in areas such as general metal fabrication, oil rig building and repair, rail, container and pipeline manufacturing where you need vast teams to weld, grind and cut all day long. These salaries have an impact on your profitability, so it’s vital to find ways to bring these costs under control.  

Substantial costs

In the EU, the average hourly labour cost in 2017 was estimated at €26.80. Yet this hides the great variation between the costs in member countries, with much higher figures in Scandinavia and generally lower ones in Eastern Europe.2 In addition, the Labour Cost Index (LCI) shows the total cost on an hourly rate of employing labour within the European Union; effectively the cost pressure of labour costs on businesses’ bottom line. According to the LCI in March 2018, hourly labour costs in industry rose by 2.3% in the fourth quarter of 2017 compared with the same period of 2016, with the main contributing factor being a rise in wages and salaries of workers.3  This means that the already significant cost of labour is still rising.

In this context, it’s clear to see why many of you are searching for ways to save time and increase productivity, without needing more labour. Labour costs can contribute up to 65%4 of overall outgoings, so how can you meet those objectives without hiring more people.

Improved efficiency

Increased productivity means working smarter not harder. This can often be achieved by improving the efficiency of your tools. Rasta’s Specialist Line cutting and grinding wheels have been designed with heavy industry in mind to improve efficiency and increase productivity when you need it most. With good material removal rates, longer product life and increased efficiency, fewer wheels are needed to do the same work in less time. In this way, it’s possible to reduce overall process costs and time lost through wheel changes to further enhance the labour cost savings and increase your profitability.

Offshore operations

Operator safety

Once you have the right workforce and found the best tools to increase efficiency, you want to keep your employees safe. Rasta grinding wheels offer enhanced comfort to users in very rough applications through reduced vibrations, which decreases hand fatigue. Operators can therefore carry out work more comfortably, meeting EHS requirements and combatting hand arm vibrations (HAV), yet still meeting business targets. What’s more, Saint-Gobain Abrasives is an active member of both FEPA and oSa and our Rasta products comply with all expectations of European health, safety and environmental standards, so you can be sure your operators are protected and using the very best materials.

If you’re looking for new ways to combat rising labour costs, please contact us or speak with your local sales representative and find out how they can be reduced with the right tools.

 

 

http://bruegel.org/2018/01/the-ever-rising-labour-shortages-in-europe/

http://ec.europa.eu/eurostat/statistics-explained/index.php/Wages_and_labour_costs

3 http://ec.europa.eu/eurostat/statistics-explained/index.php/Labour_cost_index_-_recent_trends

4 According to proprietary tests by Saint-Gobain Abrasives in Q4 2017

Share: