What Effect will IoT and AI have on Workforce Development in Manufacturing?

It’s estimated there are literally billions of Internet of Things (IoT) devices in use today. In 2025, McKinsey Global Institute estimated IoT applications could generate between $3.9 trillion and $11.1 trillion when considering healthcare, smart cities, logistics, manufacturing and consumer electronics. Soon, these numbers will likely rise as more manufacturers integrate machine learning into their operations.

The second largest share of IoT is found within the manufacturing industry where it is used for predictive maintenance and robotics integration. The industry uses IoT devices with sensors for predictive maintenance and monitoring to reduce downtime. Adoption of IoT also includes enhanced use of edge computing to improve the performance and scalability of IoT systems with the benefit of reduced latency to improve real-time operations.

As more thought leaders and CEOs incorporate artificial intelligence (AI) into their operations, it opens the door to a powerful synergy between IoT and AI to create smarter, connected systems.

The use of these technologies for automation and machine learning offers the sector new ways to become more sophisticated yet its use could enlarge the skills gap.

To fully capitalize on the potential of AI-driven IoT systems, manufacturers will need to rethink workforce development and operational strategy simultaneously. While automation can streamline repetitive tasks and improve efficiency, it also increases demand for highly skilled employees capable of managing connected systems, interpreting data analytics, and supporting advanced robotics infrastructure. This creates a growing divide between traditional manufacturing skill sets and the technical ability now needed in modern facilities.

Companies are already facing challenges recruiting workers with experience in cybersecurity, cloud computing, industrial networking, and AI system management. As factories become increasingly connected, protecting sensitive operational data and preventing cyberattacks will become just as important as keeping physical equipment on the production floor. A single vulnerability in an IoT ecosystem could disrupt production, compromise supply chains, or expose proprietary information.

To address these concerns, many organizations are investing in upskilling programs, technical certifications, and partnerships with trade schools and community colleges. Manufacturers that proactively train existing employees on smart technologies may be better positioned to remain competitive while reducing turnover and hiring costs. At the same time, AI-powered IoT systems can help businesses improve energy efficiency, reduce waste, improve inventory management, and enhance workplace safety through real-time monitoring and predictive insights.

As adoption accelerates, the convergence of AI and IoT is expected to fundamentally reshape manufacturing operations for decades to come.