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Labor Scarcity and Automation in Distribution and Fulfillment

Labor Scarcity and Automation in Distribution and Fulfillment

To most people, the idea of automated labor seems like something out of the realm of sci-fi. With visions of Rosie the Robot dancing in our heads, it’s hard to believe we’re living in the future that so long seemed restricted to the realm of fiction.

And yet, these days, automated labor has become more common, and more practical, than ever before—and nowhere is this truer than within the distribution and fulfillment industries.
Automation investment can make sure that your distribution center is prepared for the challenges of operating at peak profitability in the current market landscape.

As employers face issues of employee unreliability, high turnover, and increasing labor shortages through the distribution space, automation is more than just a future fantasy. It’s quickly becoming vital to commercial success in the here and now.

A closer look at labor scarcity

According to a recent report published by The Washington Post, over 43 million Americans quit their jobs over the course of 2021. Commonly called the “great resignation,” this wave of employee departures shows no sign of slowing. In fact, some employers report that resignation is currently at an all-time high.

So what’s the future of the great resignation? Expert predictions vary, with some stating that the trend will continue into 2023 and beyond. Other experts predict that more Americans are getting back to work—but that the attitude towards labor and willingness to walk away from a job that no longer feels rewarding will likely stay the same.

As demand for online shopping surges and e-commerce sales continue to become a preferred retail method for Americans throughout the United States, employees face increased hours and higher stress levels as they try to keep up with the growing demand.

The result? An increasingly unstable labor market that shows no signs of self-correcting, leaving employers facing higher costs and worse results. In fact, according to one study, as many as 73% of warehouse operators struggled to find adequate labor.

We need to face the facts: what was once a trend is quickly becoming a labor market norm, one that disproportionately impacts operators of distribution centers, warehouses, and other third-party logistics professionals, where staffing shortages are worsened by increasingly high turnover rates.

Automation: the wave of the future
Automation may once have seemed like a sci-fi solution to the sector’s labor woes, but these technologies have increasingly become a critical aspect of the manufacturing and logistics world’s real-world operations.
In fact, a study published in the Harvard Business Review indicated that within the next four years, the global warehouse automation market can be expected to double in value, with supply chain leaders describing warehouse automation as, …” One of their top three priorities for digital investment.”
Workers cited by the study also expressed optimism, with many sharing their excitement for the potential of automation technologies to improve safety, increase speed and efficiency, and allow them to produce higher-quality work.
The advantages of automating processes that were once performed by human labor is clear to employers who have struggled to maintain adequate staffing within their warehouses. Automation cuts down on your need to hire, making it easier to increase order accuracy, and productivity, and focus on reducing workplace injury for warehouse employees.
Not only does automation reduce the need for labor, but it also makes work less demanding, reducing the turnover rate and leading to lower stress levels and a more positive work environment that encourages employees to stick around.
These days, there are many forms of warehouse automation in common use. Companies use warehouse management systems to automate manual processes, inventory control, and data capture, supporting data analysis. Using this software in conjunction with technology such as sensors and robotics helps minimize the need for human labor, increasing efficiency and reducing costs.
Making automation practical
It’s no secret that warehouses and the fulfillment industry as a whole continue to be major drivers of change within the American economy. Around 1.5 million American workers are employed in the warehouse and storage sector, many of whom are ambivalent about the impact that the coming automation revolution may have on their careers.
However, when approached correctly, automation can actually be a critical asset in supporting the fulfillment sector for both workers and employers alike. The key to making automation an asset? Communication and training at every step of the way.
Automation can do a lot, but it still requires human intelligence and discernment to perform at its most effective level. Instead of framing automation as a threat to employees, employers should share the way that automation can make their lives better, and their jobs easier.
Done correctly, automation takes the pressure off, handling all the most dangerous, difficult, and repetitively dull tasks, leaving workers free to think more creatively and focus on building their skill sets on a higher operational level.
This need for training is apparent even to workers who are otherwise enthusiastic about the potential automation brings to their workspaces. As 35% of the warehouse workers interviewed in the Harvard study reported, workers fear that inadequate training resources will make it difficult for employees used to the old way of doing things to succeed in the new digitized, automated workspaces of the future.
“I think the more the warehouse is automated, the better we’ll all perform,” said one warehouse supervisor cited by the study. “Robots will greatly diminish our workloads, reduce risks, and increase productivity. But if we don’t know how to handle them, they’re hardly going to do any good.”
To assuage these fears, employers in the distribution and fulfillment space need to place a priority on training, communication, and open conversations with employees as they move forward into the coming automation revolution.
Emphasizing the potential career growth possibilities moving towards automation offers will allow workers to envision their longer term prospects working within the fulfillment sector, helping get them on board to perform the tasks necessary for accessing the full potential of automation technology.
As warehouse work continues to be a mainstay of the global economy, automation technologies can make a major positive impact. When human capital combines with the power of automation, anything is possible.