We began 2020 with an unemployment rate of only 3.5%, and our nation’s logistics, warehouse and distribution center operations—as well as our carrier partners—were experiencing one of the tightest labor markets in a generation.
The process of recruiting, hiring, training and maintaining an eager, engaged workforce in our warehouses, offices, and truck cabs was front and center as the most significant challenge.
As the pandemic moved across the country and we saw unemployment numbers start to shoot through the roof, many in the logistics markets were quick to think that this would represent a new crop of talent to step into the thousands of openings companies had been looking to fill over the past five years.
I was among them—thinking that the floodgates would swing open and our labor drought would be quenched. At press time, we’re finding that it’s more of a trickle than a flood; however we are seeing some forward momentum.
“Some companies are certainly leveraging the fresh crop of entry-level and experienced workers that are now available and ready to work,” says contributing editor Bridget McCrea, whose feature “Filling the void” neatly summarizes the challenges and long-term solutions for logistics professionals.
“In March, for example, Amazon announced that it was hiring 175,000 new workers to help run its fulfillment and delivery network,” says McCrea. “By mid-May, when I was finalizing the story, the company had reportedly filled all of those positions.”
One of the sources McCrea interviews this month is Tisha Danehl, vice president of strategy and professional recruitment at The Adecco Group in Chicago, an organization that staffs for front office logistics position as well as warehouse/DC personnel. According to Danehl, her clients are now eager to explore how they can “upskill,” or procure the talent they couldn’t find in a 3.5% unemployment environment.
“The flood gates aren’t opening yet, but some firms are exploring their options on the permanent hire/direct hire side of the market versus temporary employment,” says Danehl. “Logistics professionals should continue looking at their talent acquisition strategies, company cultures and assessing exactly what they need to do to attract and maintain the talent that they may not have had access to before.”
Indeed, company culture is one area that many logistics operations were already working on improving before the pandemic. And as McCrea reports, many analysts are hoping to see labor management systems (LMS) better applied to help improve culture as we enter recovery, be it in the form of stronger engineered labor standards to help with training and improved productivity or laying out a clearer path toward more enticing incentives.
“It’s good to see that there has been a shift from viewing the implementation of LMS as a ‘punitive’ measuring stick to more of an enabler focused on improving engagement,” says McCrea. “Logistics operations are going to have to flip that conversation on LMS as more move to implementation and make it a part of their broader enterprise system.”