Dive Brief:
- “Upstream” activities like manufacturability and costing are the leading use cases for artificial intelligence in manufacturing, a recent Xometry survey found. Slightly more than half of manufacturers said they expect AI to have its biggest impact in those areas in 2027.
- Forty seven percent said AI would have the biggest impact on quality control and inspection, followed by production execution on the factory floor at 32% and supplier selection and qualification at 25%.
- Although most survey respondents are seeing greater potential for AI in their operations, they are also encountering roadblocks. For example, 34% said AI and automation operators are now the hardest roles to fill.
Dive Insight:
AI and automation are among the biggest trends in manufacturing. Manufacturers are leveraging newer technologies as a way to bridge the persistent skill gap in the industry, with AI boosting engineering productivity and automation in manufacturing is set to more than double by 2030.
Meanwhile, according to a new survey by Xometry, manufacturers see the biggest impact of AI in manufacturability, costing, and quality control rather than on the shop floor. "AI is moving earlier into the manufacturing process, and the skills our industry needs are moving with it," Xometry’s CEO Sanjeev Singh Sahni said in a statement.
In the survey, 57% of manufacturers reported significant returns from AI investments, compared to 44% a year ago. Almost three-quarters said they are already applying AI to specific functions or have integrated it into their core operations.
The aerospace and defense industries are leading the way, with 82% of manufacturers planning to invest more than $500,000 in AI in 2027. Manufacturers in the robotics and automation industries came in second at 62%.
However, Xometry said much of the reported return on AI investments “is coming from general-purpose AI tools that offer no grounding in real pricing, capacity, or production data.”
"When it comes to manufacturing, AI adoption has become the baseline, not the milestone. The real question is what gets built on top of it,” CTO Vaidy Raghaven said in a statement.
Although many manufacturers see potential for both AI and automation, 34% of survey respondents said operators for those technologies are the most difficult roles to fill. Thirty one percent of respondents cited quality engineers as the hardest job to fill, followed by maintenance technicians at 29%, machinists at 23% and CNC programmers at 20%.
Raising salaries can help fill these positions to some extent, as 81% of manufacturers with more than 500 employees reported that raising pay improved hiring or retention. However, that figure dropped to 46% for companies with fewer than 200 employees.
Many firms are trying other approaches to filling the talent pipeline. For example, 91% percent of respondents said they are partnering with schools, technical colleges and/or training programs, with 59% characterizing those relationships as active and formal rather than occasional.
Still, the skills shortage is getting harder to navigate. While 77% of manufacturers reported larger production backlogs than a year ago, only 59% said they actually planned to hire in 2027.
Other key survey findings include:
- Smaller manufacturers have significantly more idle industrial capacity than larger ones. Forty four percent of manufacturers with less than $50 million in revenue said they operate at less than 70% capacity, compared with just 16% of manufacturers with more than $100 million in revenue.
- Forty eight percent of those operating below 70% capacity say finding enough work is their biggest obstacle to winning new business.
- Almost half of manufacturers expect their customers to move toward regional sourcing in Mexico or Canada over the next year, and 39% expect a shift toward U.S. sourcing.
- Broadening a firm’s supplier base is key in an era of uncertain trade policies and rising material and labor costs. “Procurement teams need to rethink how they manage the supply chains. Increasingly the solution is access to a network across multiple regions that you can leverage as you need and when you need it,” said COO Oscar Lovera.
