Shipping and logistics organizations faced steep human resources challenges in 2020, when demand for warehouse labor was at an all-time high. In September, for example, warehouse employment reached the highest level ever recorded, with 1.25 million workers in the warehouse and storage sector, according to Supply Chain Dive.
For shipping and logistics companies, social distancing, health concerns, and other pandemic-related difficulties made the staffing situation that much more complicated. These employers suddenly found themselves trying to control the impact of a shutdown while keeping their operations running. Warehouse operators struggled with changing customer demand patterns that strongly impacted the supply chain. Manufacturing interruptions, lack of components, and labor shortages created an ongoing supply chain disruption and hiring was relegated to crisis number two for companies—many of which relied on contract employees to meet demand—as they focused on employee and customer safety and shifting demand.
That brings us to Q4 of 2020 and the holiday season. The National Association of Manufacturers released its fourth-quarter Manufacturers’ Outlook Survey, which shows a strong rebound since COVID-19 disrupted business in the spring. Despite this progress, manufacturing production remains 3.7% below the level seen in February. Companies continue to cite challenges in the supply chain and hiring as the lingering negative effects of COVID-19. Just over 29% of respondents said their revenues will recover to pre-pandemic levels before or during the fourth quarter, while 38.3% said they expect their revenues to return to normal sometime in 2021.
Online holiday sales in the U.S. rose 49% from the same time a year ago, according to an end of year Mastercard report. Walmart’s e-commerce sales increased by 79% in the third quarter of last year, while rival retailer Target had an increase of 154% in online sales in the same quarter. This growth trend was underway before 2020, but the pandemic gave it a significant boost. In response, retailers have created various facilities to store products, fill orders, and dispatch. However, online retailers need an efficient supply chain to provide products to customers in a timely manner – which means logistics companies needed to fill seasonal roles quickly and efficiently.
Logistics & Distribution Holiday Hiring
The combination of COVID related health and safety protocols along with more consumers doing their holiday shopping online for the same reason has burdened all logistics operators.
Let’s take a look at what is now the largest logistics company in the world: Amazon. Between January and October, Amazon hired 427,300 workers, bringing its total global workforce to 1.2 million. That’s a 50% increase from the 798,000 workers Amazon employed as of December 31, 2019. Amazon hired around 250,000 workers within operations roles alone since February to deal with increased demand. On top of that, the company planned to hire 100,000 seasonal workers for the 2020 holiday season, and did so despite taking a hit to its employer brand. In 2020, frontline employees working for Amazon have repeatedly gone on strike and sued the company to draw attention to what they say are unsafe working conditions during the pandemic.
How did the company meet its logistics hiring goals for the 2020 holiday season? Rather than dismissing employee claims, lawsuits, and whistleblower complaints, Amazon stepped up and took accountability. In October of 2020, Amazon admitted that at least 19,000 workers have tested positive for COVID-19. It made changes – such as offering and ramping up on-site testing for COVID and spending over $85 million redeploying team members from typical roles to perform safety related tasks and audits at sites around the world. Amazon also has a dedicated facilities safety page that is at the forefront of its careers page, and it is transparent about its failures as well as what changes the company has made to keep employees safe.
What Does 2021 Have in Store for Recruitment and Hiring in Manufacturing & Logistics?
As part of its 2021 predictions guide, Forrester cited several areas that will drive growth in manufacturing and logistics in the coming year, including 3D printing of protective equipment, augmented reality (AR) headsets used to reduce time doctors spent with high-risk COVID-19 patients, reskilling machinists to build ventilators, and remote support used to help engineers guide customers through remote maintenance tasks.
Related: How we help manufacturing companies hire.
Additionally, warehouse automation technology, such as RFID and automated workflow solutions, will be key for logistics enterprises to maintain operations and manage critical workflows. Warehouses and distribution centers have historically been dependent on a large workforce to pick and pack orders, load/unload trucks, operate forklifts, and much more. However, warehouse operators had to implement social distancing measures and limit the number of employees in their facilities, which drastically accelerated the development and adoption of flexible automated solutions within warehouses as well as increasing the need for tech and other workers with different skill sets.
Safety protocols will be key to attracting workers in coming months, which means investing in tech and staffing solutions, such as thermal imaging kiosks that screen for fevers and provide reminders to wear masks, or staff like the designated safety ambassador roles that Amazon implemented. Expect competition to be stiff, which means using bonuses or pay increases to attract workers.
The biggest challenge for HR leaders in these industries will be upskilling workers for new technology and hiring experienced workers with specific skill sets in technology and supply chain management, along with warehouse and logistics automation. This means investing in comprehensive talent development programs and creating new career paths through training programs, apprenticeships, and outreach that attracts talent from competitors that may not be as quick to create development programs.