Having the right people and the right kind of management practices in place are key to being prepared for peak season demands, industry experts informed the members of the Warehouse Education Research Council.
The advice was offered by Brian Devine, senior vice president of EmployBridge, a leading supply chain staffing agency and the parent company of ProLogistix, and Gerald Perritt, managing partner of The Perritt Group, the supply chain and operations management consulting firm.
In areas where there are heavy concentrations of distribution centers – such as southern California, Dallas/Fort Worth, Indianapolis, Eastern Pennsylvania, and major port cities — the number of unfilled positions in distribution centers is “astounding,” they point out.
Those working in supply chain management ask why it is a continuing struggle to hire and retain quality warehouse workers? Is it all about the CARES act and unemployment claims? How will you execute peak season amidst these challenges?
“Times were challenging before the pandemic struck due to historically low unemployment rates,” the Devine notes. “However, firms with very good people processes in place before Covid-19 also are now experiencing hiring and retention struggles, although their struggles are not nearly as intense as those companies that had less focus on hiring and retention processes leading up to the pandemic.”
For many of those already struggling organizations, thoughtful planning for the peak season is not even on the table right now, he says.
“We believe the single most critical issue is the imbalance of unemployment benefits compared to the available jobs and pay rates today,” the authors declare.
For example, at $13 per hour, an employee receives about $520 for a typical 40-hour week. Normally, unemployment benefits pay 50% of previous earnings. Until the CARES Act expired at the end of July, employees were receiving $600 per week from the federal government and on average about $300 per week from their state governments.
A late July survey of warehouse workers by ProLogistix found the pandemic has affected the desire and ability of 40% of the respondents to go to work. Also, 49% say they are most concerned about their and their families health and safety.
“By now, most companies should have fundamental warehouse Covid-19 response countermeasures and procedures in place,” the authors say. “If you do not, there is still time to improve the health and safety practices in your operations.”
Because of the pandemic, frontline supervisors who are already overextended will face even greater stress and need support from top management.
“Logistics cannot be executed from home. If our hourly and salaried team members are coming in to work every day as an essential business, it is only fair that our senior leadership team is leading from the front during this crisis,” says Hari Sivaprakasam, chief operating officer of Sunland Logistics Solutions.
Lightening the mood helps, too. “The best general managers have a good blend of seriousness and sense of humor,” Devine and Perritt observe.
Find team members who thrive in doing this, motivate them to help lighten the mood and give your teams something positive to talk about when they get home. “You can show your teams that you respect and value them in a fun way,” they say.
Management also needs to get creative, especially in geographic areas where hiring is difficult. Instead of having your human resource and recruitment teams “fishing in the same ponds” as your competitors, have them focus on identifying quality candidates outside your normal geographic scopes.
“It will require more time and effort to organize transportation and schedules,” they say, “but it will likely eliminate the daily, ‘I had 15 more people not show up today’ report.”
A region leader for a multi-national company tapped into the college student market and found success in hiring students who need flexible hours. Other warehouse operators have done the same.
Avoid the excuse loop, they urge. “The best general managers we’ve worked with rarely make comments about things that are out of their control.”
There are two groups of people you can hire from. One is the large group of people who are working, about 130 million people strong. The other group are people who were already undependable and are quite happy to ride out the pandemic as long as possible, Devine and Perritt say.
“Focus your recruitment and retention efforts on the first group of people,” they recommend.
For more detailed advice, see this article at the WERC website.