How to Reduce Labour Costs in Manufacturing Without Compromising Quality

Reducing labour costs in manufacturing is a top priority for plant managers, operations directors, and business owners — especially in high-wage economies like New Zealand. But cost-cutting doesn't have to mean job losses or reduced quality. Instead, it can be achieved through smart automation, process optimisation, and workforce upskilling.

Here’s how manufacturers are effectively reducing labour costs while increasing productivity:

1. Automate Repetitive Tasks

Automation is one of the most powerful tools to reduce reliance on manual labour. By integrating:

• Robotic systems for palletising, packaging, and assembly

• PLC-controlled machinery for consistent production

• Vision inspection systems to ensure quality control
  … you can free up human labour for higher-value tasks.

Bonus: Automation reduces rework and downtime, saving both time and money.

2. Invest in Industrial IoT (IIoT)

Smart factories powered by IIoT can monitor machine performance in real-time, predict failures, and optimise energy and labour use. Data-driven insights help managers:

• Identify bottlenecks

• Reduce unplanned maintenance

• Improve shift scheduling
  All of which contribute to a leaner workforce and lower costs.

3. Optimise Workflow & Layout

Poor factory layout leads to excessive movement, waiting times, and wasted effort. Lean manufacturing principles like 5S and Kaizen help streamline operations, reducing the number of workers needed per task or line.

4. Outsource Non-Core Functions

Outsourcing tasks like equipment maintenance, quality audits, or even automation engineering to specialised firms can significantly reduce in-house labour requirements — especially for SMEs.

5. Cross-Train Employees

Cross-training builds a more flexible and resilient workforce. When employees can operate multiple machines or handle multiple roles, you're less dependent on hiring for every task.

6. Use Predictive Scheduling Software

Advanced scheduling software can align labour demand with actual production needs, avoiding overstaffing during slow periods or under-staffing during peaks.

 ACSE Helps You Automate & Optimise

At ACSE Limited, we help New Zealand manufacturers reduce labour costs through tailored automation solutions — from robotic integration to machine vision systems and SCADA development.