Warehouses and distribution centers turn to automation in response to persistent labor shortages

More than 43 million Americans left their jobs in 2021, according to The Washington Post. This mass exodus has put a strain on operators of warehouses, distribution centers and 3PL providers who have been forced to deal with labor shortages as e-commerce sales have exploded in recent years. . These staffing issues have been exacerbated by high turnover rates among workers facing longer hours and increased stress as they attempt to meet the fulfillment needs of their employers.

Automation offers significant benefits to employers struggling to adequately staff warehouse environments. In addition to reducing the need for labor and making work less demanding for current employees, automation can increase productivity, control accuracy and reduce workplace injuries. Given these advantages, it is no surprise that the global warehouse automation market is expected to double in value over the next four years, according to a study conducted by the harvard business review. Indeed, supply chain managers who participated in the study identified automation as one of their top digital investment priorities.

The net impact of automation is not inherently positive, however, at least not initially. Although automation can save employers money in the long run, the initial costs can be high and the implementation time can be considerable.

The most commonly identified concern associated with automation is the supposed loss of jobs. However, this perceived disadvantage has drawn serious skepticism from commentators, many of whom argue that the increased productivity from automation creates as many job opportunities as it eliminates. Additionally, automating repetitive and simple tasks allows employees to learn new skills, take on more complex tasks, become self-sufficient to move up the value chain, and makes workers’ jobs safer and more meaningful.

Nevertheless, these changes often cause anxiety and uncertainty among employees. For this reason, employers looking to incorporate automation into some aspect of their warehouse operation should make a deliberate effort to communicate honestly and openly with the workforce. They should educate employees that the changes are not meant to cut jobs, but to help them do their jobs and create opportunities for advancement.

Employers should also take proactive steps to provide growth opportunities for employees, including opportunities for entry-level warehouse workers to eventually advance to management positions. If current employees can see a path to meaningful career advancement, the idea that more menial tasks could be shifted to automation should be less of a concern.

The importance of initial communication and education regarding automation is especially true for unionized employers. Employers with union shops will likely need to spend more time and energy educating union leaders about the positive effects of automation. Preparing and educating employees and their bargaining agents on integrating automation should ease the transition.

Warehouse work is one of the pillars of our global economy. Automation has serious utility and is becoming more of a necessity (rather than just a competitive advantage) in today’s job market. It has the potential to solve tough personnel issues, increase efficiency and empower employees. Nonetheless, employers implementing automation technology in warehouse environments would do well to consider the impact on their current workforce by investing in opportunities for growth and advancement.

Please contact a Jackson Lewis attorney with any questions.

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