Despite rising software budgets, AI skill shortages are becoming a bottleneck in U.S. manufacturers’ digital transformation. In fact, technology investment continues to surge, prioritizing AI and automation, yet many companies are struggling to find talent with the right skillsets to implement and deploy the technology effectively, according to “Smart Manufacturing 2026: Agile Leaders Confront the AI Skills Gap Manufacturers,” produced by Revalize.
“AI and automation are transforming the manufacturing sector, but without serious investment in workforce training to leverage these technologies, initiatives fall short of expectations,” says Mike Sabin, CEO of Revalize. “The industry’s continued technology investments must be matched by a commitment to upskilling talent through both internal programs and external academic partnerships. I foresee 2026 as a pivotal turning point where manufacturers will either move beyond AI hype and take the necessary steps to bridge the gap between investment and readiness or fall behind as competitors move faster toward Industry 5.0.”
Key takeaways:
- 77% of manufacturing leaders report increased software budgets over the past 12 months, up from 70% the year prior, signaling sustained momentum behind digital transformation. Additionally, 93% of manufacturing leaders plan to utilize new technologies, tools, or software this year.
- While 56% of manufacturers reported having implemented AI in select areas, only 10% said the technology was fully integrated across their operations, illuminating a critical gap in execution.
- U.S. manufacturers lead investment in AI-driven and human-centric Industry 5.0 technologies, creating the highest demand for AI skills among all countries surveyed. As a result, 44% of U.S. teams cited a need for AI expertise, 16% higher than other regions.
- 84% of manufacturers feel prepared to adopt and leverage Industry 5.0 technologies, a slight decline from last year, reflecting a more realistic understanding of the integration, data, skill, and workforce capabilities required for success.
