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Distribution & Fulfillment
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Transportation
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Material Handling Equipment

Labor Shortage Impacts: Mitigation Through Innovation

Industries across the U.S. are experiencing steep labor shortages as the nation comes into what we hope to be a post-pandemic job market. While businesses are posting record job openings, hiring continues to be a challenge, and logistics managers are not immune. What can shippers do to mitigate the impacts of the labor shortage? The answer lies in innovative solutions.

Logistics Labor Shortage by the Numbers

According to Barron’s, as of April 2021, there were twice as many unfilled manufacturing jobs as there were pre-pandemic, on average. In fact, there are more job openings at American manufacturing companies than at any point since at least the 1990s. The transportation, warehousing and utilities category is also seeing a record number of open positions, up 30% from the pre-pandemic average.

60% of warehouse operators cite labor recruitment and productivity as a top challenge. In an effort to attract and retain employees, many businesses are increasing wages and offering more competitive benefits packages. This has resulted in rising labor costs across the supply chain, though many believe the cost of not adjusting wage expectations to be even greater. Needless to say, staffing issues and employee churn pose a great risk to long-term productivity and costs maintenance.

 

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Shippers Solution? Innovation.

Where most U.S. industries shifted to remote work during the pandemic, the durable consumer goods industry remained largely in-person by necessity. Generally speaking, the industry requires workers with specialized skills who are able to show up to work each day. Technological advancements are helping make these jobs more accessible for people by introducing a remote work aspect. And for the jobs still left vacant, innovative solutions are augmenting human labor, thus helping warehouse operators remain efficient and cut costs.

Kenco is on the front lines of using innovation to solve for labor shortage problems and build a resilient supply chain despite external market circumstances. This month, Kenco became the first North American 3PL to partner with Phantom Auto to utilize its remotely operated forklifts to service customers. Using Phantom Auto’s technology, a warehouse forklift can be operated remotely from anywhere in the world with online connectivity. Operators sit at a console outfitted with a steering wheel and pedals and are able to safely and skillfully operate the vehicles. The technology will first be rolled out in a pilot program with Kenco Innovation Labs.

Phantom Auto’s technology removes geographical restrictions to hiring, thus broadening the labor pool. Candidates don’t have to live within commuting distance to warehouses, and employers can potentially reach people in rural areas with limited employment opportunities. Additionally, Phantom provides an accessibility aspect by expanding MHE operator jobs to individuals with mobility issues that might have otherwise been unable to operate machinery in-house.

Additionally, Kenco is deploying AutoStore’s Robotics Shuttle system, an automated storage and retrieval system that uses robots to fetch densely packed goods. We are also rolling out a fleet of self-driving robots from Locus Robotics Corp and testing out autonomous tractors that tow carts loaded with pallets. These innovations will be integral in filling the gaps left by the labor shortage.

 

Finding Opportunity in Adversity

Warehouses need to be proactive in their approach to moving forward with labor challenges. Solutions beyond more competitive pay and benefits are needed and will help generate cost savings and efficiencies to offset rising labor costs. The current state of labor provides an opportunity for companies to nail down efficient, long-lasting supply chain solutions beyond people management. In our adventures with the newest innovations, Kenco is helping pave the way for far more resilient, cost-effective supply chains for our customers.

 


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Kenco Logistics

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Kenco provides integrated logistics solutions that include distribution and fulfillment, comprehensive transportation management, material handling services, real estate management, and information technology—all engineered for Operational Excellence.