How to Manage a Warehouse Labor Shortage

A warehouse or distribution center has many moving parts. Each one requires workers who are skilled in particular areas to keep the facility operating at peak performance. From pickers and packers to drivers and assembly workers, the labor force in a warehouse is diverse. When there’s a shortage of personnel, the impact is felt throughout the company—and even by its customers.

Warehouses sometimes experience high employee turnover because there are so many competitors vying for top talent that employees often leave one warehouse to work at another. Therefore, knowing how to manage a warehouse labor shortage is important for any warehouse manager. Even more important is knowing how to keep employees from leaving in the first place.

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What Causes a Warehouse Labor Shortage?

A warehouse worker may leave one job for another for several reasons. Much like any profession, employees are commonly lured away by promises of higher wages, better benefits, more flexible work schedules, better training, greater opportunities for advancement, worker incentive programs and other attractive offerings.

With the U.S. national unemployment level down to 3.5 percent as of fall 2019, the job market in the warehouse industry is strong. As a result, there are many openings for workers to pursue.

How to Handle a Warehouse Labor Shortage

Because warehouse labor shortages are inevitable, it is best to have certain processes in place to minimize the impact. This is most easily accomplished by using automation and technology.

Implementing robotics and automation technology ensures a warehouse can still operate on some level, even with a reduced physical workforce. This doesn’t mean you should replace all of your employees with robots, but it will help protect your warehouse against unexpected shortages in manpower.

When trying to determine which processes can benefit from automation, consider current information on the costs to process an order, the number of employees needed per shift, picking and packing process details, the number of orders open and your error rate.

How to Best Manage Warehouse Employees

A warehouse will always need workers, no matter how automated it becomes. How you manage your employees will determine whether you attract and retain top talent or risk losing them to your competitors. To improve your retention rates:

  • Keep your warehouse clean, well organized and safe for workers.
  • Implement ergonomic workstations and equipment.
  • Offer competitive pay and benefits.
  • Provide ongoing training and support.
  • Maintain flexible work schedules.
  • Train for flexibility to ensure workers can perform more than one job.
  • Build an incentive program to encourage top performers.
  • Engage with workers on a regular basis.
  • Listen to your employees, and be open to their ideas and suggestions.

Warehouse workers are just like everyone else: They want to do their jobs and be respected. They also want to be happy at work and enjoy the rewards of a job well done.

Learn about Prologis’ efforts to close labor shortages through their Community Workforce Initiative, which recently opened a Trade and Logistics Lab at a high school in Miami to help build a pipeline for skilled workers in distribution, logistics and transportation.


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