In my role at iBase-t, I have the privilege of speaking regularly with leaders across the aerospace and defense industry. And time and again, the same concern comes up: our workforce is at a critical inflection point.
Many of the executives I speak with are grappling with high turnover, the loss of decades of hard-earned knowledge as seasoned professionals retire, and the ongoing challenge of attracting and retaining the next generation of skilled workers. It’s not just a background issue—it’s a growing risk to operational continuity and competitiveness.
To put it into perspective, Aerospace Industries Association member companies are seeing average turnover rates of around 13%—a stark contrast to the national average of just 3.8%. On top of that, roughly a quarter of the workforce has 20+ years of experience and is nearing retirement. That’s a lot of institutional knowledge walking out the door.
And we feel the daily impact of production delays, increased rework, more mistakes, and heightened compliance risks. It’s clear that hiring alone won’t close this gap quickly enough. This isn’t just an HR challenge—it’s a strategic business issue that requires leadership from the top.
From my experience and conversations with peers across the industry, I’ve seen firsthand that the companies making real progress are those where the CEO is directly involved in shaping the workforce strategy.
Here are three proven approaches I believe every CEO in aerospace and defense manufacturing should consider when tackling this challenge:
1. Retain Expertise by Capturing Critical Knowledge
The Challenge:
Experienced employees often carry essential knowledge about processes, systems, and customer-specific requirements. Unfortunately, much of this knowledge remains undocumented. When these workers retire or leave, the organization suffers in terms of efficiency, productivity, and quality.
CEO Actions:
- Position training and knowledge management as essential tools for operational excellence rather than compliance checkboxes.
- Direct your operations and technology leaders (COOs and CIOs) to integrate digital knowledge capture directly into daily operations and core enterprise systems, ensuring the documented expertise becomes part of the standard workflow.
- Tie executive compensation to successful knowledge retention and transfer, making senior leadership accountable for addressing the risks associated with expertise loss.
Companies ensure continuity, boost productivity, and improve operational reliability by strategically capturing and integrating expert knowledge into day-to-day activities.
2. Attract Skilled Talent by Redesigning the Work First
The Challenge:
Recruiting new talent is costly and slow and simply hiring more people won’t automatically resolve deeper operational inefficiencies. Antiquated workflows and manual tasks can discourage new hires and diminish productivity.
CEO Actions:
- Shift your hiring criteria from purely credential-based to skill- and capability-based, opening the door to a broader, more diverse talent pool.
- Prioritize operational improvements that automate tedious, manual tasks. Encourage COOs and CIOs to lead initiatives that streamline workflow processes before filling vacant positions.
- Ensure alignment between talent acquisition teams and operational leadership, so job designs accurately reflect current execution realities rather than outdated organizational charts.
Improving workflows and job designs makes roles more attractive to potential employees, accelerates onboarding, and reduces turnover.
3. Enhance Workforce Agility to Improve Productivity and Flexibility
The Challenge:
Rigid job roles and fixed staffing structures create bottlenecks and inefficiencies, especially when employees become unavailable. Companies struggle to quickly reassign staff without causing productivity losses.
CEO Actions:
- Use real-time operational data as the basis for staffing decisions, asking your COOs and HR leaders (CHROs) to align workforce planning with actual production demands.
- Focus your technology investments on platforms and tools that enhance workforce flexibility and responsiveness. Direct CIOs and COOs to minimize risks associated with skill shortages or resource constraints.
- Hold senior leadership accountable for workforce adaptability by tying execution performance measures directly to workforce planning and operational agility.
Building an adaptable workforce enables companies to respond more effectively to disruptions and fluctuations in demand without losing productivity or quality.
Workforce Strategy: A Critical CEO Responsibility
Execution problems often stem from deeper challenges—such as outdated processes, inadequate systems, or gaps caused by retiring employees and turnover. Successful aerospace and defense CEOs recognize that workforce planning goes beyond the HR department; it’s an operational imperative integral to the broader corporate strategy.
Industry research reinforces this approach. According to LNS Research, leading industrial organizations increasingly view workforce strategy as central to operational excellence rather than as a supporting function. Their “Industrial Transformation Readiness” framework highlights the importance of investing in cross-functional collaboration, digital knowledge management, and workforce agility to achieve continuous improvement and resilience.[i]
In my experience at iBase-t, having the right manufacturing execution system (MES) can significantly support these workforce strategies. Solutions like Solumina help standardize processes, ensure quality control at each step, and provide real-time visibility into shop floor operations. This makes training easier, reinforces best practices, and supports effective workforce management and optimization.
Addressing these workforce challenges requires collaboration and continuous dialogue. If you are exploring similar workforce-related issues and solutions, I would welcome a conversation to share insights and approaches to overcoming these common industry challenges.
[i] Allison Kuhn, “Attract and Retain a Quality Workforce with Future of Industrial Work,” LNS Research Blog, July 31, 2023, https://blog.lnsresearch.com/attract-and-retain-a-quality-workforce-with-future-of-industrial-work.
