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Smart Robots Empower Warehouse Teams During Labor Shortage

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Archives, Global Logistics, Global Trade Daily

Smart Robots Empower Warehouse Teams During Labor Shortage

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AI-Powered GreyOrange robots help reduce human workforce walk rates, tedious tasks and turnover rate

Robots continue helping humans with everything from leisure to work activities – from playing music and delivering food to picking and packing inventory in distribution centers. As growing labor shortages, volatile lead times, global supply chain challenges and rising costs create ripple effects in global commerce, robotic automation has become the go-to solution for omnichannel fulfillment. With a 49% turnover rate in 2021, labor shortages are at a record high and are projected to grow long-term.

Robotic automation mitigates labor shortage challenges while improving the work environment for fulfillment associates as robots take on repetitive tasks and allow smart management teams to implement upskilling programs that support employee satisfaction and retention. GreyOrange’s fulfillment platform equips retailers to fulfill high volume ecommerce orders seven times faster and with 50% less physical effort.

Among the latest technology created to help mitigate the labor shortage spurred from a new partnership and solution that solves for inefficiencies and safety challenges in truck loading and unloading by combining Technica International’s iTLS technology with GreyOrange’s fulfillment orchestration platform, GreyMatter™.

Technica’s unique and innovative robotic truck loading and unloading solution iTLS improves dock efficiency and speed by leveraging GreyMatter™, a robot agnostic fulfillment orchestration platform with seamless integration, to orchestrate robots through the activity, enabling workers to focus on higher value tasks. Supply chain and logistics leaders now have another avenue to meet global challenges, including the current labor shortage, as cooperative robotic-human solutions are increasingly recognized by both workers and leaders as essential tools for supporting the workforce.

According to the Essential Warehouse Workers Briefing Book, most warehouse laborers work 12 hour shifts and walk between 15 and 20 miles per day, therefore demonstrating the need to preserve the human body with robots. With the right software and robots, physically demanding warehouse jobs are reimagined, with the intent to slow increasing warehouse attrition rates.

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Archives, Global Trade Daily, Special Reports

A Macroanalysis of the Future of Work and Employment From Its Facilitators

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Recent disruptions have made it clear that the nature of employment is changing. Labor shortages have proved persistent across industries, and employers are realizing that traditional workspaces, trends and workflows may not be ideal.

Perhaps the most notable shift coming from these trends is a broad movement toward remote work. As Nicole Sahin, CEO and founder of Globalization Partners, emphasizes, “companies who can build successful international teams will be ideally placed to succeed in the post-pandemic economy.”

These changes are coming to more than just office workspaces, too. The future of supply chain employment hinges on this shift.

Changing Workforces Today

This shift is already visible across workforces and industries today. While some companies have announced a return to in-person work, many plan to enable remote or hybrid options long term.

According to a Gartner survey, more than 80% of companies plan on enabling remote work at least part-time after the pandemic. Many of these businesses likely didn’t anticipate embracing these policies long-term but changed their minds after witnessing the effects. About 82% of executives reported similar or higher productivity after shifting to remote work.

Another trend impacting the future of supply chain workforces is the growing labor shortage. In a recent survey, 47% of third-party logistics companies cited finding, training and retaining qualified labor as a top challenge.

Amid these shifts, supply chain employment won’t remain the same for long. Here’s a closer look at what’s ahead for the industry.

Why Future Supply Chains Need Remote Work

The most significant change coming for supply chain employment is the same as other industries: remote work. Over the next few years, leading supply chain organizations will embrace off-site and hybrid jobs. Those that don’t will fall behind.

Remote work will be a necessity for future supply chains. Here’s why.

Higher Productivity

One of the biggest reasons supply chains will need remote work is because of its productivity benefits. Sahin emphasizes the benefits of remote work on productivity in a recent blog post. “Those who spend at least 60%-80% of their time working remotely were more likely to be engaged.”

Engaged workers tend to meet higher productivity standards, which supply chains need. Widespread disruptions will likely continue into the future, and logistics organizations must adapt to mitigate them and prevent future delays. Higher productivity is a crucial step in that direction.

If supply chains can boost employee productivity through remote work, they can meet growing logistics needs.

Acquiring Top Talent

Another critical advantage of flexible work environments is how they give companies access to global talent leaders. As Sahin explains in a LinkedIn post, “by spreading the net wide, you can tap into highly qualified talent pools, many of which are found in emerging economies … remote work can bring the best companies and the brightest people together.”

As the supply chain space grows more competitive, acquiring top talent will be increasingly valuable. Companies that can gain the expertise of worldwide leaders in management and technology can speed ahead of the competition. Since these people will come from all regions of the globe, working with them requires remote collaboration.

Mitigating Labor Shortages

Remote work will also help supply chains overcome the ongoing labor shortage. In the face of unfilled positions, logistics companies must look outside their immediate area, and traditional avenues in that area are declining.

Sahin explains: “While some companies depend on immigration programs to relocate talent, those avenues are facing increasing restriction. All the while, the skills gap widens.” The solution is to enable remote work to pull talent from around the globe.

If supply chains can access distant talent pools, local labor shortages won’t be as impactful. As the current “Great Resignation” continues, that will become all the more central to ongoing success.

How Remote Work Could Grow in Supply Chains

While it’s clear that supply chain workforces must go remote, the path to that goal is less evident. Unlike in office jobs, where much of the work-from-home revolution is happening, logistics involves a lot of hands-on, physical labor.

Despite these challenges, the supply chain industry can still capitalize on remote work. However, doing so will require significant change over the next few years. Here’s what that could look like.

Hybrid Offices

The first step the industry will take toward remote work is on the management side of operations. While truck drivers and many warehouse workers must be in-person to perform their duties, that’s not true of office employees. These jobs also potentially have the most to gain from remote work.

In an interview with Tealfeed, Sahin touched on how traditional office jobs are becoming a thing of the past: “it seems likely that the office-based environment that has remained a foundation of modern business could see permanent change.” When modern technologies make these jobs easily accessible remotely and working from home improves productivity, there’s little reason to keep them in a physical office.

Supply chain management is ideal for remote collaboration given its distributed, often international nature. If management teams need to collaborate across multiple countries anyway, it’s only natural that they should fully embrace work-from-home tools.

Industry 4.0 Technologies

The next step in the shifting future of supply chain employment is to bring hybrid work to the warehouse. Traditionally, these jobs were impossible to translate into the work-from-home model. Industry 4.0 technologies like 5G and the Internet of Things (IoT) offer a solutions.

Some companies have already started testing remote-controlled forklifts, enabling off-site employees to accomplish in-warehouse tasks. As faster, more reliable networks become widespread through 5G, similar technologies could apply to multiple workflows. Companies that invest in these methods earlier could drive the workforce shifts of the future.

This transition will take time, largely due to limited infrastructure. As Sahin points out, “As of October 2020, only 59% of the world’s population had internet access … [and] many communities with internet infrastructure don’t have the resources to access it.” Internet access will have to become more widely available and reliable for this shift to take full effect.

Employment Is Changing, Even for Supply Chains

After the disruptions of the past few years, it’s clear that supply chains must adapt. Part of that evolution is a shifting workforce, especially in embracing remote work.

The road to remote work for supply chain organizations is long, but the benefits are too promising to ignore. As current trends continue, logistics employment will shift to become more flexible, unlocking new possibilities.

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Archives, Global Logistics, Global Trade Daily, Warehousing

How Can Warehouses Attract New Talent in 2022?

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For the first time in a while, it seems as though workers are holding more power than their employers across all industries, including the supply chain. While warehouses are experiencing a period of unprecedented growth, thanks to the boom of e-commerce, the labor market isn’t able to keep up. As the industry continues to expand and productivity demands keep increasing, warehouses face a staffing problem. There’s a growing labor shortage in the logistics sector, making it increasingly difficult to recruit and retain employees.

While the labor shortage began long before the pandemic, the problem has intensified over the last year as a rampant rise in online shopping, rash of store closures, and mandatory social distancing hampered warehouse operations.

During this unprecedented labor shortage, how can warehouse managers focus on recruiting well in the new year? What are tried and true tactics that will still carry over, and what are some new out-of-the-box ideas to explore in this uncharted territory?

1. Offer Competitive Compensation

Monetary compensation is probably the number one factor when workers are deciding between similar jobs. In fact, warehouse employees ranked pay as their highest priority for 11 years in a row. Being able to offer competitive salaries is one of the most important ways to remain competitive to applicants. Aside from wages, benefits like generous matching 401ks and retirement savings plans can help attract applicants. These incentives, particularly those with longer-term payoffs, will also help retain current workers.

2. Provide Promising Career Paths

There is a common saying in the workplace, “People don’t leave jobs, they leave managers.” This holds true in the warehouse environment, where grueling physical labor, rigid shifts and undesirable work conditions are more common than in other professions. Perhaps more than any other industry, warehouses must invest the time and money in hiring and retaining top talent in middle management. Recruiting, promoting, and training quality managers can make employees feel valued and appreciated by fostering a collaborative culture, improving communication and processes and soliciting feedback from front-line workers. Managers that encourage and listen to feedback from warehouse workers will not only increase employee satisfaction and retention, but also gain valuable insight that can ultimately improve operations, increase efficiency and reduce costs.

To that end, providing thoughtful promotion and training opportunities is one of the best ways to prevent high turnover rates. Workers are less likely to be incentivized to stay very long if they don’t feel there is room for career opportunities. Employees who are promoted within three years have a 70 percent chance of staying, compared to just 45 percent with those who aren’t. According to the same study, workers who moved laterally had a 62 percent chance of staying. Any kind of opportunity to move within the company will attract and retain employees, but upward mobility is key. Promotions are great, but they aren’t the only means of providing growth. There are smaller, equally effective, steps like rewarding productivity with incremental raises.

3. Become A Known Name

While posting on popular job boards and paying for advertisements will help get the word out about your open positions, doing the work to become a local community name could give certain companies a competitive edge. Potential workers will be more likely to accept a position with a company they recognize, than one they’ve never heard about. If you get connected within the community, you’ll appeal more to the local workforce. This can be accomplished by establishing a presence and making relationships with trade schools, community colleges, and universities. Try and partner with these institutions to appear at job fairs or establish student work programs. Sponsoring or partnering with local nonprofits or community groups is another way to become a community staple.

4. Create Flexible Schedules

Warehouses are known for pretty rigid schedules for a reason; they objectively make it easier to manage a warehouse, but can also be off-putting to potential employees, especially in a present and post-pandemic world. Flexibility is a necessity for many workers and a feature that many employers may not offer. You can stand apart from the competition by adapting schedules to people’s needs. Flexible scheduling will also help retain employees, allowing them the ability to not sacrifice personal endeavors and responsibilities. Being able to adapt their schedule to the rest of their life provides a benefit they won’t be quick to abandon.

5. Establish an Employee Referral Program

An often overlooked tactic for employee recruitment and retention is implementing an employee referral program. It’s an effective incentive for employees when they can earn a bonus or extra time off from a successful referral hire. These rewards will encourage employees to help you recruit more talent and improve workplace morale. This is because referrals translate into your employees working with people they already know. This familiarity can make the workplace more comfortable, which helps prevent turnover. Workers who successfully referred another will also know they’ve made a meaningful contribution, increasing their chances of staying.

6. Ensure Optimal Working Conditions

With many warehouses already strapped for space, dedicating a large area for an employee rest and relaxation, gym or on-site child care may not be feasible. However, small upgrades like comfortable furniture, Wi-Fi access, charging stations for mobile devices and free snacks and beverages can go a long way to make employees feel more welcome. Since warehouse workers typically have long and unpredictable shifts, companies can provide added convenience for employees by bringing in food trucks, organizing a company carpool program or even covering the costs of rides and meal delivery.

It’s not just the bells and whistles that make for a more optimal working environment. Extreme temperatures and inadequate lighting not only affect employee wellbeing and productivity but can also compromise worker health and safety. Incorporating windows and skylights into your warehouse design can improve ventilation and also provide access to natural light, which studies show is the highest-rated office perk among many employees. In addition to bringing in more daylight, companies should consider replacing old fluorescent bulbs with LED fixtures, which enhance visibility, produce less heat and reduce maintenance and energy costs.

And, with less labor available, existing employees are likely feeling overworked. So how can you lighten the load with a lack of manpower? Many companies are turning to upgrade their technology with automation. Robotic goods-to-person solutions such as automated storage and retrieval systems (ASRS) and autonomous mobile robots (AMRs) that deliver goods to workers can significantly reduce travel time for employees while also increasing throughput and order accuracy. However, that does require a significant investment.

But, there are other, lower lift alternatives. In addition to robotics, software and wearable devices are also gaining popularity in the warehouse. These tools can be used to monitor worker safety and health, streamline processes and provide real-time training and support. Labor management systems can also be used to track performance and recognize and reward employees for going above and beyond.

As demand for warehouse space and labor continues to grow, hiring skilled workers will become increasingly competitive. Since warehouse employees don’t have the luxury of working from home, it’s up to companies to create a safe, comfortable and satisfying work environment with plenty of incentives to attract and retain top talent.

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Archives, Global Logistics, Global Trade Daily, Warehousing

Fight the Labor Shortage with Upskilling and Reskilling

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Warehouse and logistics employees were getting harder to find pre-pandemic, and the COVID-19 outbreak has increased that level of difficulty. Companies across all industries are having a difficult time finding, recruiting and retaining workers in an industry known for requiring long hours on your feet, some heavy lifting and high overall employee turnover.

“Competition for warehouse workers was already stiff before the pandemic. Stores were adding jobs at their warehouses and logistics networks as more customers ordered online,” CNN reports. When the global pandemic drove up ecommerce sales, it added more pressure on retailers to staff up at warehouses.

“Now, retailers are scrambling to add extra warehouse staff as they ramp up for the peak holiday season amid a record number of unfilled jobs,” CNN adds. Citing Korn Ferry statistics, the news outlet says 52% of retailers are facing “significant challenges” hiring warehouse employees right now, and that 33% of the companies surveyed are having an equally hard time staffing their stores.

Of course, at the opposite end of any major disruption lies new opportunities. In this case, companies have a chance to reverse the tide of the labor shortage through upskilling and reskilling. Are you up to the challenge? Read on to find out.

What are Upskilling and Reskilling?

The speed at which jobs are changing—sometimes due to automation and other times due to new business models—means that employees must constantly learn new skills in order to stay relevant and satisfied with their jobs. In many cases, traditional career paths or educational models aren’t enough to satisfy the rapidly evolving demands of the modern workplace. This is where upskilling and reskilling come in.

Upskilling is learning additional skills or enhancing existing abilities, often with the goal of advancement. A retail store clerk or office manager would upskill when transitioning to a management or corporate role, for example. Reskilling, on the other hand, is learning a new set of skills or training for a new role, often with the goal of transitioning to a new job or different industry. A truck driver who wants to become a computer programmer would need to reskill.

Updated Knowledge and Skillsets

Highlighting the value that upskilling and reskilling provide companies and their associates, Ohio News Time says more companies are investing in both because they help employees “perform better with the updated knowledge about their field and the latest developments in their industries.”

“Upskilling creates a positive impact on both organization and staff that can be witnessed through better performance and an increasing number of goals being achieved,” the publication points out. Upskilling and reskilling also help companies promote productivity and bring out the best in their associates; build more self-reliant, confident workforces; and help workers navigate through uncertainty.

“Uncertainty is a crucial reason for companies to invest in upskilling their employees,” Ohio News Time points out. “This includes all the technological advancements, new projects, and reorganizations.”

How Technology Supports Upskilling and Reskilling

With technology transforming every field and advancing the functionalities within those fields,  employees are learning how to leverage new advancements at work. The warehouse or distribution center (DC) is a perfect backdrop for seeing the value of upskilling and reskilling in action. Highly automated warehouses are much more attractive and require a more advanced skillset from the new generation of warehouse/supply chain employees.

For example, Cameron’s Coffee is a coffee roasting, packaging, and distribution company that receives its coffee beans from South America, stores them in Minnesota and ships them to hundreds of stores across the country. The company originally had a paper-only warehouse where individuals had to manually check and encode items.

Ready for a change, Cameron’s Coffee decided to update its warehouse and use a combination of the SOLOCHAIN WMS and MES that directly tied into its ERP. With the addition of the software coupled with iPads and handheld devices, the warehouse’s efficiency skyrocketed, sales increased by 50%, ecommerce grew by 200%, and the company was able to expand the size of its warehouse by 25%.

Equipped with their new software and iPads, the company’s employees were not only more efficient, but they were also happier in their jobs. The new technology increased their independence and reduced the amount of time required to complete tasks.

Time to Replace those Aging Systems

When you replace aging, manual warehouse systems with a modern WMS, you’ll not only get efficiency and productivity gains, but you’ll also experience an overall boost in employee morale. This is because the more you reduce the mental and physical strain on your employees the happier they will be.

Utilizing technologies that younger staff is comfortable with (e.g., iPads and touchscreen devices) helps them be more productive and safe at work. Implementing voice command technology in the DC, for instance, helps reduce mental strain and drives an increase in productivity.

5 Ways to Kick Off Your Upskilling Program

Over the next few years, upskilling and reskilling may become more important than ever before. According to the World Economic Forum’s most recent The Future of Jobs report, about 40% of employees’ core skills will change within the next five years. This means that 50% of all employees will have to upskill or reskill.

To companies that want to start their own in-house programs, AG5 suggests these five starting points:

1. Establish training programs for your current workforce.

2. Set up a mentorship scheme in which experienced veterans transfer still-needed skills to the younger generation.

3. Focus on creating versatile and multidisciplinary staff. Job rotation is a prime example of how to achieve this.

4. Add new tasks to existing job profiles so that staff have to learn new skills.

5. Hire specialists to fill gaps for which your current workforce has yet to be retrained.

With no end in sight to the current labor shortage, and with ecommerce once again expected to grow in the double digits in 2021, the time to start assessing your workforce and implementing upskilling/reskilling programs is now. Rather than waiting for your competitors to get a leg up on you, why not make some moves in this direction today?

Solutions exist today that can ensure any warehouse or distribution center operates at peak efficiency, 24 hours a day, seven days a week. From Warehouse Management Systems (WMS) and Transportation Management Systems (TMS) to Manufacturing Execution Systems (MES) and more, software platforms can deliver a wide range of benefits that ultimately flow to the warehouse operator’s bottom line.

Generix Group North America provides a series of solutions within our Supply Chain Hub product suite to create efficiencies across an entire supply chain. Our solutions are in use around the world and our experience is second-to-none. We invite you to contact us to learn more.

This article originally appeared here. Republished with permission. 

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Archives, Global Trade Daily, Special Reports

Cities With the Biggest Increase in Construction Jobs

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While the potential for trillions of dollars of new infrastructure spending looms on the horizon, America’s construction industry is struggling to even keep pace with current demand for new homes, businesses, roads, and bridges. A shortage of supplies and employees has created ongoing challenges for construction firms and their customers.

“The home building industry faces a major shortage of skilled workers. This persistent challenge endangers the affordability and availability of housing and hinders a robust economic recovery,” said Ed Brady, president and CEO of the Home Builders Institute (HBI), which recently released a report detailing the extent of the worker shortage. At the start of 2021, 60% of builders were experiencing a labor shortage, and the industry was in need of more than 300,000 additional workers, according to HBI. Even more recently, the trade association Associated Builders and Contractors estimated 430,000 additional workers would need to be hired in 2021.

While the construction labor shortage has been exacerbated by recent economic conditions, it is a trend that predates the COVID-19 pandemic. The longer-term issue stems from a decades-long decline in trade education and a lack of interest among younger workers, many of whom perceive employment in the construction industry as a last resort.

The construction labor shortage is most severe for framing crews and carpenters, where about 25% of firms reported a serious shortage and nearly another 50% reported moderate labor shortages, the HBI report noted. Other trades facing significant labor shortages included bricklayers, masons, concrete workers, painters, and plumbers.

Despite short- and long-term labor shortages at the national level, states where population growth has been hottest are also where construction hiring has boomed in recent years. From 2015 to 2020, the Bureau of Labor Statistics recorded about 35% growth in construction employment in Idaho and Nevada, as well as about 30% growth in Florida, Arizona, Oregon, and North Carolina. In contrast, states in the Mid-Atlantic and Midwest regions have seen construction jobs stagnate or even decline over the past five years.

To find which metropolitan areas have added the most construction jobs over the same time period, researchers at Construction Coverage analyzed BLS data between 2015 and 2020, calculated the percentage change in construction employment, and ranked all metros of 100,000 residents or more based on that growth.

Here are the large metropolitan areas that added the most construction jobs over the past five years.

Metro Rank   Percentage change in construction employment (2015–2020) Percentage change in total employment (2015–2020) Total change in construction employment (2015–2020) Total construction employment (2020) Median annual wage for construction workers (2020)

 
Sacramento–Roseville–Arden-Arcade, CA    1     48.8% 10.7% 17,510 53,370 $55,250
Charlotte-Concord-Gastonia, NC-SC    2     37.9% 8.7% 15,270 55,580 $41,270
Las Vegas-Henderson-Paradise, NV    3     34.1% No significant change 13,320 52,340 $49,140
Phoenix-Mesa-Scottsdale, AZ    4     33.3% 12.4% 25,900 103,640 $47,030
Tampa-St. Petersburg-Clearwater, FL    5     32.2% 7.2% 14,570 59,860 $38,870
Nashville-Davidson–Murfreesboro–Franklin, TN    6     31.3% 9.3% 8,210 34,470 $41,810
Portland-Vancouver-Hillsboro, OR-WA    7     30.9% 4.9% 13,360 56,580 $59,390
Jacksonville, FL    8     29.8% 9.8% 7,800 33,970 $38,450
Riverside-San Bernardino-Ontario, CA    9     29.6% 13.7% 19,100 83,650 $52,580
Miami-Fort Lauderdale-West Palm Beach, FL    10     28.5% 3.0% 23,080 103,950 $41,440
Salt Lake City, UT    11     27.2% 10.4% 8,370 39,130 $48,060
Orlando-Kissimmee-Sanford, FL    12     25.5% 6.6% 11,850 58,230 $39,670
Grand Rapids-Wyoming, MI    13     24.2% No significant change 3,770 19,320 $46,190
Raleigh, NC    14     22.1% 10.1% 5,100 28,180 $43,340
Indianapolis-Carmel-Anderson, IN    15     20.1% 2.7% 6,950 41,580 $48,360
United States    –     8.4% 0.9% 460,010 5,937,830 $48,610

 

For more information, a detailed methodology, and complete results, you can find the original report on Construction Coverage’s website: https://constructioncoverage.com/research/cities-with-biggest-increase-in-construction-jobs-2021

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3pls, Archives, Global Logistics, Global Trade Daily

The Labor Shortage is the Next Major Issue Facing the Supply Chain

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The labor shortage is fast becoming the next significant problem for the supply chain. Many frontline warehouse employees fall into the category of shift workers who have yet to return to the workforce, even as the economy bounces back, and the demand for workers still continues to climb. While these critical jobs remain difficult to fill, employers are focusing on optimizing the labor force they have and introducing incentives and employee recognition programs to keep the team they do have engaged and happy. 

A particularly painful category of workers that’s in short-supply and high demand is supply-chain planners. Now, in addition to having to manage the current logistics issues and shortages, employers are having to figure out how to fill the position that would have traditionally helped alleviate some of these bottlenecks or re-allocate duties to current employees who are likely already overworked. With job openings close to a 20-year high, supply chains are struggling to keep up with a new boom in consumer demand.1  

The labor shortage within the supply chain will ultimately end up costing manufacturers and the end customer more money as distribution teams continue to be backlogged and understaffed. While manufacturers and suppliers work to hire and train as quickly as possible, many are utilizing supply chain visibility tools to alleviate the strain of labor shortages within operations. With much of the strain falling on frontline employees, real-time warehouse visibility is more important than ever.

Industries Where Labor Shortages are Having the Greatest Impact 

Several companies, from fast food chains like Chipotle Mexican Grill, Inc. to chicken producer Pilgrim’s Pride Corp., and MGM Resorts International say they can’t find or even attract enough workers.2 In addition to the hospitality and warehousing industry suffering labor shortages, the automotive industry is also experiencing their own shortages due to reduced demand due to the chip crisis.3 Short-term shutdowns to sanitize facilities combined with difficulties hiring workers continues to cause strain and slow down growth for manufacturing.4 Because of this, many companies are now turning to labor management visibility for a better understanding of how to utilize their existing workforce more efficiently.  

Labor Management Solutions Producing Measured Success 

When short-staffed, it’s imperative to make smart decisions about the different tasks and activities being allocated to each employee inside the warehouse. Incorporating a warehouse visibility tool focused on labor management allows employers to see how the workforce is performing at the company, region, warehouse, shift or any other level defined in real-time. Having the ability to drill-down into the metrics and pinpoint measured versus unmeasured work issues helps identify the next steps needed to optimize labor utilization and productivity.  

Having a labor management visibility solution in place also provides real-time insight into those employees that are going above and beyond their assigned job functions. Employee recognition, pay for performance, and high-performance incentives for employees is more important than ever before to keep the existing workforce satisfied as well as engaged with their work. 

In a recent Rebus by Longbow customer case study, it was reported that the implementation of a labor management visibility solution enabled labor sharing across multiple sites, which reduced the need for two full-time equivalent employees per site as well as most of the overtime hours. This ultimately equated to 9% in labor savings equating to $1.3 million.5 

Intelligent Labor is the New Normal  

In the era of the “New Normal”, many of the former workforce remains unable to return to work due to health fears or the inability to find child or elder care. Because of this, it’s more important more than ever to utilize warehouse visibility and labor management tools to optimize productivity. The important thing to remember is to find an appropriate labor management system that is built for measuring tasks on the floor, not just reporting on them.  

With this enhanced real-time visibility, warehouse operators will be able to see where they can reallocate their labor force on the spot to maximize daily supply shipments in order to fulfill more orders each day.  

___________________________________________________________________

Alex Wakefield is the CEO of Longbow Advantage with over 20 years of experience in supply chain technology and implementations including leadership roles at IBM and Blue Yonder (formerly JDA/Red Prairie). His focus is on enabling distribution teams to better manage, leverage and action their data across the supply chain through the use of Rebus, the only real-time warehouse visibility and labor platform purpose-built for the supply chain. 

 ____________________________________________________________________

Sources: 
1: https://www.bloomberg.com/opinion/articles/2021-04-30/labor-shortage-rising-costs-supply-chain-hiccups-hit-manufacturers    
2: https://www.bloomberg.com/news/articles/2021-05-06/companies-warn-of-u-s-labor-shortages-economists-call-temporary  
3: https://www.autonews.com/manufacturing/plants-big-worry-missing-demand-because-chip-crisis  
4: https://www.industryweek.com/the economy/article/21156586/manufacturing-in-february-rapid-growth-checked-by-supply-hurdles  
5: https://meritmileinc-my.sharepoint.com/:b:/g/personal/jsternal_meritmile_com/EV7ZODTg1mhKrTWuE31cOw0BVB2L85t–qJckupxvHaWPg?e=Uu1KM0 

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Archives, Global Trade Daily, News

Labour Shortages and the EU Ban: New Challenges for the Palm Oil Market

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IndexBox has just published a new report: ‘World – Palm Oil – Market Analysis, Forecast, Size, Trends, and Insights.’ Here is a summary of the report’s key findings.

While Indonesia, planning to expand production, fights for the EU’s recognition of palm oil as a biofuel, Malaysia is faced with an acute shortage of labor due to the outflow of guest workers after the pandemic. Despite the challenges in these two countries, which produce 85% of the world’s palm oil, the global demand remains high. As the economies of the main importers, China and India, recover, the previous growth in demand is expected to continue.

Key Trends and Insights

In March 2021, the futures price for crude palm oil reached its highest level of 954 US$/MT in 13 years, according to the Malaysian Palm Oil Council, March 23. This is due to limited supply from manufactures as a result of the COVID-19 pandemic.

Malaysia, the world’s second-largest palm oil producer, faces severe labor shortages. Since the beginning of the pandemic, the country has stopped hiring foreign workers, and the former migrants have returned to their homeland. Malaysian suppliers have asked the government to fill a 50,000 labor shortage, which could lead to a 20% drop in palm oil production. They also ask to cut product taxes and invest additional funds in the industry.

Over the next two years, the rising demand from the world’s two largest importers, India and China, is expected to become the main driver for the palm oil market growth. These economies recover, and rapid urbanization contributes to an increase in the need for food products.

Falling production and rising prices for sunflower oil, as a result of the sunflower harvest failure last year, could further fuel demand for palm oil.

Increasing tariffs for container transportation and a planned reduction of palm oil consumption in Europe could hamper market growth. The Renewable Energy Directive (RED) II and other food safety regulations could decrease palm oil imports to the European Union and phases out the use of palm oil as biodiesel. In 2017, the European Parliament adopted a resolution that bans palm oil for biofuel production due to the large-scale deforestation and labor rights violations in Indonesia and Malaysia. Also, in 2019, the European Union imposed an import duty on Indonesian biodiesel.

Indonesia Dominates the Market and Continues to Expand Production

Global palm oil production rose remarkably to 76M tonnes in 2019, picking up 6.4% against 2018. The total output volume increased at an average annual rate of +5.4% from 2012 to 2019.

Indonesia (44M tonnes) is the world’s largest producer of palm oil, comprising approx. 57% of the global volume. Moreover, Indonesia’s palm oil production exceeded the figures recorded by the second-largest producer, Malaysia (20M tonnes), twofold. The third position in this ranking was occupied by Thailand (3M tonnes), with a 4% share (IndexBox estimates).

From 2012 to 2019, the average annual growth rate in Indonesia totaled +7.7%. The remaining producing countries recorded the following production growth rates: Malaysia (+0.8% per year) and Thailand (+7.9% per year).

Driven by increasing demand for palm oil worldwide, the market is expected to continue an upward consumption trend over the next decade. Market performance is forecast to decelerate, expanding with an anticipated CAGR of +3.1% for the period from 2019 to 2030, projected to bring the market volume to 106M tonnes by the end of 2030.

India and China to Remain as the Top Importers

In 2019, global palm oil imports rose markedly to 50M tonnes, picking up by 7.2% on the previous year. The total import volume increased at an average annual rate of +2.8% over the period from 2012 to 2019.

In value terms, palm oil imports amounted to $30.5B (IndexBox estimates).

In 2019, India (9.7M tonnes), distantly followed by China (5.5M tonnes), Pakistan (3.2M tonnes), the Netherlands (2.8M tonnes), and Spain (2.7M tonnes) represented the key importers of palm oil, together creating 47% of total imports. The U.S. (1.6M tonnes), Italy (1.5M tonnes), Bangladesh (1.5M tonnes), Egypt (1.1M tonnes), Malaysia (1.1M tonnes), Russia (1.1M tonnes), Myanmar (1M tonnes), and Kenya (0.9M tonnes) followed a long way behind the leaders.

From 2012 to 2019, the biggest increases were in Spain, while purchases for the other global leaders experienced more modest paces of growth.

In value terms, the largest palm oil-importing markets worldwide were India ($5.4B), China ($3.4B), and Pakistan ($1.8B), together comprising 35% of global imports.

Source: IndexBox AI Platform

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ProMat Day Three Combines Education, Awards, and Comedy

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Thought leaders, exhibitors, and attendees kept the momentum going on day three of this year’s massive ProMat Trade Show in Chicago, despite chilly temperatures. Wednesday’s education seminars continued addressing some of the biggest industry challenges while identifying key differentiators that foster optimal results and competitive advantage.

One of the most talked about themes at this year’s conference is the major issue of labor shortages. Employee recruitment and retention are among the biggest concerns for industry players. As automation continues reducing unnecessary manpower, human involvement has become a complex role to balance. Topic leaders across multiple sectors have already made it very clear that humans in the workplace continue to be a critical component. Even so, some companies continue expressing uncertainty in how to approach tapping into the labor market.

OPEX Corporation’s John Sauer addressed these concerns head-on in a presentation on Wednesday. Sauer is the Senior Business Development Manager for OPEX and boasts 8 years of front line material handling management experience. In his presentation, Sauer confirmed some of the biggest issues among employees in warehouses are factors some might consider to be small – such as climate control, physical demands, consistent hours, and work independence. At the end of the day, employees nowadays are looking for more than just a salary – they want to feel some importance and pride in what they do.

In today’s technology-centric environment, these factors can be addressed through strategic implementation of the technology at-hand. By utilizing technology for optimizations in operations and creating an environment that supports a positive work environment for employees, retention and recruitment challenges can be alleviated.

MHI Industry Night

Wednesday concluded with a special networking event featuring comedian and actor Craig Ferguson following the announcement and recognition of leading companies for “Best Innovations” and Young Professional Awards. There were 108 submissions for the awards and only four finalists were selected for each category. Among the winners included:

Best New Innovations:

Fetch Robotics for CartConnect

Locus Robotics for Gamification

Attachments for Forklift Safety Device (FLSD)

CMC srl for Pick2Pack

Best Innovation of an Existing Product:

ProGlove for Mark 2 Smartglove

RightHand Robotics Inc. for RightPick: The Piece Picking Solution

Artitalia Group Inc. for Versatile Nesting Cart

Swisslog Logistics Automation for ItemPiQ

Best IT Innovation:

Yard Management Solutions for Eagle Eye Yard Management Software

LogistiVIEW for Vision Pick and Put Wall

Schaefer Systems for WAMAS Lighthouse

KNAPP Inc. for redPILOT