{"id":97954,"date":"2023-02-01T10:21:50","date_gmt":"2023-02-01T03:21:50","guid":{"rendered":"https:\/\/advantage.vn\/?p=97954"},"modified":"2023-03-01T10:48:11","modified_gmt":"2023-03-01T03:48:11","slug":"logistics-layoffs-signal-industry-wide-culling-leave-seasoned-talent-available","status":"publish","type":"post","link":"https:\/\/advantage.vn\/en\/logistics-layoffs-signal-industry-wide-culling-leave-seasoned-talent-available\/","title":{"rendered":"Logistics layoffs signal industry-wide culling, leave seasoned talent available"},"content":{"rendered":"

Recent layoffs at big-name logistics companies could be the start of a wider culling of supply chain jobs amid economic uncertainty, according to experts, leaving plenty of talent available for firms still hiring.<\/strong><\/p>\n

Freight forwarder Flexport laid off 20% of its workforce last month, citing a macroeconomic downturn that is hurting its customers. Other seasoned industry names including\u00a0C.H. Robinson\u00a0and\u00a0DSV\u00a0are also relying on layoffs or hiring freezes as a way to reduce their labor costs.<\/p>\n

\u201cLower volumes, combined with improved efficiencies as a result of new organizational and operational structures, means we are overstaffed in a variety of roles across the company,\u201d co-CEOs Dave Clark and Ryan Petersen told employees\u00a0in a Jan. 11 memo.<\/p>\n

\"logistics<\/p>\n

Many companies in the sector had aggressively expanded their employee ranks to keep up with heightened demand sparked by the COVID-19 pandemic. Oftentimes, they competed in pricey bidding wars for talent across the supply chain.<\/p>\n

But with consumer spending now cooling in a cloudy economic environment, accelerated growth has turned into bloated operating expenditures over the past several months. As vulnerable companies respond by slashing payrolls, they leave an opening for other businesses to swoop in and add seasoned talent to their ranks.<\/p>\n

Technology companies could see the most pressure<\/h3>\n

Companies offering technology-driven logistics services and platforms are at the highest risk to enact future layoffs, said Spencer Shute, principal consultant at Proxima. Shippers aren\u2019t often looking to implement pricey new technology during an economic downturn, limiting the growth of the likes of Flexport, he added.<\/p>\n

Many logistics firms have the option to pare down their network\u2019s transportation and warehousing assets, such as FedEx\u00a0cutting back its flight frequencies. But companies with few \u2014 if any \u2014 physical assets to begin with don\u2019t have that as an option.<\/p>\n

\u201cThey don\u2019t have the assets or the fleets or maintenance programs, things like that, that they can try to reduce costs on,\u201d Shute said. \u201cIt ultimately comes down to labor, which is their biggest expense.\u201d<\/p>\n

Recruiting and sales employees are often targets of labor cost-cutting measures, and engineering roles could be at risk at some logistics companies, Shute said. On the other hand, more manual positions such as drivers and warehouse staff continue to be a high hiring priority for many employers.<\/p>\n

\"logistics\"<\/p>\n

But even frontline jobs haven\u2019t been immune to wider economic pressures. Seasonally adjusted warehousing and storage employment\u00a0fell about 3.7%\u00a0from June to December, according to the U.S. Bureau of Labor Statistics.<\/p>\n

Reducing labor costs in response to weakening demand isn\u2019t a new scenario for the logistics sector. However, the current environment has some unique qualities compared to past downturns that could give companies added pause before enacting their own cost-cutting measures, said Brad Hulbert, a director in Grant Thornton\u2019s sourcing and supply chain practice.<\/p>\n

Employers are attempting to rightsize their labor force while at the same time trying to minimize losses from recent hires, who have often required elevated recruiting and training expenses in a competitive hiring environment. Hulbert added that many companies are also already doing more logistics work with fewer employees, often by relying on technology platforms to reduce the amount of people needed to track shipments.<\/p>\n

\u201cIt gets harder and harder to squeeze that operating expenditure out of your annual levels, because you have already reduced headcount over the last five to 10 years with those efficiency gains in technology,\u201d he said.<\/p>\n

Resilient competitors poised to benefit<\/h3>\n

With several logistics companies cutting jobs and pressing pause on hiring, an influx of talent is now looking for work.<\/p>\n

Chris Shields, global CEO and founder of freight and logistics recruitment firm Freightalent, said there are plenty of candidates in the freight technology space available for hire, such as designers, developers and engineers. Resilient competitors with consistent growth have taken advantage of the situation, swooping in and bolstering their ranks with experienced employees.<\/p>\n

Even the firms that have announced layoffs continue to hire in other areas. C.H. Robinson has\u00a0jobs\u00a0in operations, technology and other areas open. Flexport, meanwhile, is looking to double its software engineering talent as it waits for conditions to improve.<\/p>\n

\u201cThe current slowdown in volume gives us time to focus on building our technology bench while the economy lags,\u201d Flexport\u2019s memo said. \u201cThen, as the economy recovers, we will be ready to be the Flexport that we all want to be\u2013the one stop for customers to make the movement of goods around the world easy.\u201d<\/p>\n

\"export<\/p>\n

However, Shields said employers with sudden, large-scale layoff announcements could be a deterrent to their recruiting efforts, even when customers\u2019 volumes rebound and hiring ramps up again.<\/p>\n

\u201cIt\u2019s going to be a massive advantage for all these other companies who are going through steady and solid growth continually,\u201d Shields said. \u201cThey\u2019re going to be able to get good talent, just because these other companies kind of shot themselves in the foot a little bit in the way that they\u2019ve managed things.\u201d<\/p>\n

supplychaindive.com<\/strong><\/p>\n

>> Other news:\u00a0<\/strong><\/span><\/p>\n