Why supply chain workers are key to recovery

Count­less key work­ers are keep­ing the coun­try going dur­ing the coro­n­avirus pan­dem­ic. Health work­ers have kept peo­ple alive, while busi­ness­es are man­ag­ing to keep the econ­o­my going, albeit at a slow­er pace. But it is sup­ply chain work­ers who have become the unex­pect­ed heroes.

Ware­house and dis­tri­b­u­tion work­ers became key work­ers dur­ing lock­down, deliv­er­ing goods to the nation’s doors, at a time when online shop­ping spiked, and ensur­ing super­mar­ket shelves remained well stocked.

“The inter­est in sup­ply chains has gone through the roof in the last three to four months,” says Dr Andrew Lahy, glob­al head of strat­e­gy and inno­va­tion, at DSV Panalpina, and co-direc­tor of Cardiff University’s PARC Insti­tute of Man­u­fac­tur­ing, Logis­tics and Inven­to­ry, who has worked in sup­ply chain oper­a­tions for two decades. “It’s always been per­ceived as a bit bor­ing,” he says. “It’s trucks, it’s ware­hous­es, it’s sheds. It’s not the excit­ing stuff.”

But now it’s a major dri­ver of employ­ment as peo­ple recog­nise the impor­tance of sup­ply chain jobs to the econ­o­my. “What we’ve seen with coro­n­avirus was just an accel­er­a­tion of a change that was already hap­pen­ing,” says Lahy.

It’s always been per­ceived as a bit bor­ing. It’s not the excit­ing stuff

COVID-19 came soon after Brex­it, both of which attuned con­sumers to the idea of logis­tics and how their goods are pro­duced and shipped. Sup­ply chain oper­a­tions is a fast-paced indus­try that requires quick prob­lem-solv­ing skills and work­ing in the sec­tor is now a legit­i­mate career path.

Growing recognition for supply chain jobs

“Peo­ple tend to recog­nise more what the sup­ply chain is all about,” says Michael Bourlakis, pro­fes­sor of logis­tics, pro­cure­ment and sup­ply chain man­age­ment at Cran­field School of Man­age­ment. “With COVID-19, we’ve had peo­ple pan­ic buy­ing and then the role of the sup­ply chain got some recog­ni­tion, but to have a big­ger or more last­ing impact, I think there needs to be more aware­ness about its role.”

The sup­ply chain got some recog­ni­tion, but to have a big­ger or more last­ing impact, there needs to be more aware­ness about its role

This could come through increas­ing employ­ment. Along­side career oppor­tu­ni­ties for those who under­take a sup­ply chain man­age­ment degree, more and more peo­ple are slot­ting into sup­ply chain jobs from oth­er lines of work.

Dur­ing the ear­ly stages of the pan­dem­ic, even air­line pilots reskilled as Tesco deliv­ery dri­vers and Ama­zon took on thou­sands of new work­ers. The online retail­er has since said it plans to fill anoth­er 7,000 sup­ply chain jobs in the UK to meet demand this year and a fur­ther 20,000 posts to deal with the Christ­mas rush. It’s also build­ing three new ful­fil­ment cen­tres where ware­hous­ing and dis­tri­b­u­tion work­ers will work along­side robots to com­plete cus­tomer orders. In the Unit­ed States and Cana­da, it plans to hire 100,000.

Ensuring supply chain workers treated fairly

Yet many big ecom­merce com­pa­nies have come under fire for their treat­ment of sup­ply chain work­ers. Ama­zon has been crit­i­cised for allow­ing its work­ers to take only min­i­mal breaks, while fash­ion retail­er Boohoo’s sup­ply chain was the sub­ject of neg­a­tive head­lines dur­ing the height of the pan­dem­ic. With the rise of ware­house pick­ing machines and the desire for ever­more fast-paced deliv­ery and logis­tics, ensur­ing employ­ees are treat­ed well is more impor­tant than ever.

“It’s the peo­ple, the process­es and the tech­nol­o­gy as well now,” says Lahy. “The com­pa­nies doing it well man­age to com­bine all three of those things. Just hav­ing one or two is often not enough and, def­i­nite­ly, if you’re miss­ing the peo­ple side, it doesn’t mat­ter how good your process­es and your tech­nol­o­gy are, in the end sup­ply chains are about peo­ple.”

The rise of automa­tion in the sec­tor is grow­ing, but it’s cer­tain­ly still on the hori­zon, rather than at our fin­ger­tips. “We’re a long way from hav­ing autonomous deliv­er­ies to get prod­ucts to con­sumers,” says Bourlakis. “It makes sense to me, whether it’s Tesco, Ama­zon or Mor­risons, for big retail­ers to hire work­ers. It’s going to be a dri­ver for sure, as long as this ecom­merce increase will be sus­tain­able, which I think it will be.”

Keep­ing those employ­ees hap­py will be cru­cial; even in a once-in-a-life­time down­turn, peo­ple won’t stick with jobs if they are treat­ed bad­ly. And with pub­lic per­cep­tion of sup­ply chain work­ers nev­er high­er, employ­ers would be fool­ish to mis­treat their staff.

“There is still some work to be done to tack­le this chal­lenge in the sup­ply chain,” Bourlakis con­cedes. “In every sec­tor you might see issues.” But pub­lic views are shift­ing. “At the end of the day, food and prod­ucts that come onto our tables wouldn’t be there unless effi­cient sup­ply chains bring them,” he adds.

Regionalising supply chains

The sup­ply chain is also mutat­ing to adapt to demand, which means more jobs are required clos­er to home rather than abroad. “What we’re see­ing increas­ing­ly now is com­pa­nies accel­er­at­ing this dri­ve towards dis­trib­uted man­u­fac­tur­ing,” says Lahy.
When he start­ed in the sec­tor, man­u­fac­tur­ing moved from the UK to Asia, with a sep­a­ra­tion of roles. Some­one made a prod­uct in Asia, deliv­ered a fin­ished good to Europe, and it was picked and packed in the UK. “Increas­ing­ly, those two things – man­u­fac­tur­ing and logis­tics – are merg­ing. In the medi­um and long term, it’s com­bin­ing those skills,” he says.

Work­ers look­ing to enter the indus­try will need to be mul­ti-tal­ent­ed, with quick minds and prob­lem-solv­ing skills to unpick the log­jams that occur. And com­pa­nies that pre­vi­ous­ly had not thought about their sup­ply chain will now be see­ing it with fresh eyes. “Some retail­ers didn’t have the sup­ply chain as a pri­or­i­ty, but I think it will become some­thing to think about very care­ful­ly in the future,” says Bourlakis.

The future may be uncer­tain, espe­cial­ly when it comes to employ­ment and the wider econ­o­my, but things are look­ing up for the sup­ply chain.

Could supply chains be saviours of the job market?

The UK job mar­ket isn’t look­ing good. The unem­ploy­ment rate rose to 4.1 per cent in the three months to July, with near­ly 700,000 peo­ple dis­ap­pear­ing from the nation’s pay­roll since March. The unem­ploy­ment rate among 16 to 24 year olds is 13.4 per cent.
Bar work­ers, restau­rant staff and tem­po­rary jobs are all off the table. Pinch points are occur­ring in the job mar­ket. But could the sup­ply chain be a life­line, buck­ing the down­ward trend of employ­ment?

“The dam­age to the UK labour mar­ket over the near term is like­ly to be rel­a­tive­ly uneven with sec­tors most acute­ly impact­ed by ongo­ing restric­tions such as con­sumer-focused firms hard­est hit, while those able to func­tion more eas­i­ly are like­ly to see strong demand for labour,” says Suren Thiru, head of eco­nom­ics at the British Cham­bers of Com­merce.

“Sup­port – assis­tance with retrain­ing costs, cost of employ­ment – to help peo­ple shift from strug­gling sec­tors to those that are grow­ing can lim­it the expect­ed surge in unem­ploy­ment.”

That’s borne out with com­pa­nies like Ama­zon hir­ing. Dr Andrew Lahy, glob­al head of strat­e­gy and inno­va­tion, at DSV Panalpina, says: “There was a drop when coro­n­avirus start­ed, but I’m see­ing peo­ple try­ing to hire now. Com­pa­nies are real­is­ing they have to adapt their sup­ply chains, and they need the skills and peo­ple who can do that.”

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