2018 MHI Executive Summit and Annual Conference
* By Doug Reed, MHI Executive Vice President of Strategic Development *
The “e” in e-commerce could stand for “explosion” these days, and it’s showing no signs of slowing down. But we don’t have to tell you that.
“When you look at a large-scale fulfillment center, whether it’s highly automated or a manual facility, it can actually require two or three times the number of workers that a retail replenishment would have,” says Jason Franklin, product manager, labor and business intelligence for MHI member Intelligrated. “And that’s because of the picking.”
Amazon and other large-scale entities may have enlisted the automated help of Kiva robots, he notes, but they still need a human workforce—and so do the rest of the companies in the supply chain. And as online orders continue to pour in, the Baby Boomers continue to age out.
“We’ve got this blue-collar generation that was all about ‘do what your Dad did, work hard and stay with the same company and you’ll grow,’” Franklin explains. “Those things are out the door now. And because of that, Millennials have a different expectation as to what a job should provide.”
Franklin tells the story of a Nashville facility that’s dealing with some labor challenges.
“Another company is building a facility right next door that’s air conditioned and heated,” he says. “So if you’re someone who’s got a job that pays $10 an hour and you can get the same pay across the street, are you going to choose the one where it hits 110 degrees in the summer or the one that’s climate-controlled?”
And the competition across town is just as easy to vet. Years ago, job seekers had to visit each potential employer to get a sense of the opportunities available. Today, they can check 10 different listings on their phones at lunch. They can eliminate seven that pay $10 an hour and focus on three that pay $11. And of those three, which is closer to home? Which has better benefits? It’s all out there.
“If you look at the U.S. labor market from 2016 to now, non-management workforce labor—which means warehouse labor—has gone up nearly 10 percent in roughly two years.” Franklin says it’s the shortage driving the cost.
“Making sure you get the right people—and retain them—is becoming that much more important because you not only have less people to choose from, you’re paying the ones you do hire more.”
Attracting top talent these days is about positivity when it comes to management and perks—at the very least, better ones than the warehouse next door—when it comes to motivation.
Read on to find out what it takes to woo and win the cream of the crop.