More than 80 percent of U.S. manufacturers say they cannot find enough qualified workers to meet customer demands, according to an industry study released Tuesday.

While some 3.4 million factory jobs have been lost since 1998, the National Association of Manufacturers (NAM) said employers are now struggling to find enough high-skilled machinists, technicians and engineers to keep production lines humming.

Of the more than 800 manufacturers surveyed, 13 percent reported a severe shortage of qualified workers, while 68 percent said they experienced a moderate shortage.

"The survey exposes a widening gap between the dwindling supply of skilled workers in America and the growing technical demands of the modern manufacturing workplace," said NAM President John Engler.

The report, released by NAM, the Manufacturing Institute and Deloitte Consulting, found 83 percent of manufacturers were struggling to serve customers because there were not enough qualified workers.

Some struggled to produce enough to meet customer demand, while others could not meet targets for productivity or customer service.

The exodus of baby boomers from the U.S. work force, a negative stereotype of manufacturing and a drop in the number of American students pursuing technical or engineering degrees are fueling the problem, Engler said.

The news on Monday that General Motors Corp. (GM) would be cutting 30,000 jobs does not help the industry's image, but Engler said the United States remains a manufacturing powerhouse -- especially in innovative and high value-added production.

Lowering costs, as foreign automakers have managed to do, will ensure even labor-intensive products can be built here, he said.

"There will be a lot of people building cars in America for a long time," Engler said in an interview with Reuters.

When manufacturers struggle to find enough qualified workers, Jeffrey Owens, president of Peoria, Illinois-based Advanced Technology Services, helps fill the gap.

"It's a pretty significant problem," said Owens, whose 1,500 workers provide factory maintenance for heavy machinery maker Caterpillar Inc. (CAT) and industrial and aerospace conglomerate Honeywell International Inc., among others.

"A lot of people are retiring who are extremely talented, good people, and there's nobody coming in behind them ... The younger generation doesn't consider manufacturing a viable career alternative," Owens said.

While the image of back-breaking labor in steel plants or on assembly lines may be what most Americans still think of when they imagine factory work, Owens said the modern workplace is often more about computers.

"You really use your brain a lot more than you use your back," he said. "There are some guys that can really work magic with the machinery to keep it running. Sometimes it's more of an art than a science."

While ATS has established a training program to lure students out of high school or technical schools and into a workplace where they can become multiskilled technicians, experts say education in the nation as a whole is weak.

"Communication is needed between campuses and employers," said Cliff Waldman, a global economist at the Manufacturers Alliance/MAPI, a business research organization. "Companies have been remarkably innovative ... (but) the educational system has to work on instilling these skills."

NAM said its survey found significant dissatisfaction among manufacturers with the quality of kindergarten-to-grade 12 education and the dearth of adequate career counseling.

"We must update the image of modern manufacturing in the minds of young people, their parents and educators, and encourage more students to study math and science or follow a technical career path," Engler said.