Overcoming the warehouse labor shortage through strategic staffing

Warehouse jobs have seen tremendous growth ever since the pandemic spurred an e-commerce boom, and they’re not showing any signs of slowing down. In October alone, the Bureau of Labor Statistics reported that the industry added 54,000 jobs. But as anyone in warehouse management or operations can tell you, applications are nowhere near keeping pace with the number of positions posted. In times like these, strategic staffing becomes more important than ever.

This is something that Steven Houston, a Senior Consultant with supply chain consultant firm Joshua Tree Group, knows all too well. With expertise in warehousing, transportation, logistics, and labor, the consulting group offers end-to-end distribution insights — particularly to facilities with large headcounts and multiple shifts.

We sat down with Houston recently to get his insights on combating current labor challenges, optimizing operations, and how warehouses can better utilize the labor they already have as we enter into an unprecedented peak season. Read on for highlights from that conversation.

Think critically about headcount

In working with clients, Houston has found that companies don’t always have a great read on how many people they actually need working on the warehouse floor. At a certain point, it becomes a numbers game with diminishing return. As more people are added to an operation, there comes a point where the impact each person added has on the total output lessens. This is why it’s important to know the quality of the individual and the value you expect they will yield.

“One of the most common problems that we see is having a lot of labor being thrown at a problem,” Houston said. “Warehouse operations don't know who's actually in the building… they don't know exactly where they're adding value.”

In situations like this, flexible staffing solutions like Instawork can be a great option. With traditional staffing models, a distributor might order 10 workers a day for 90 days to get through the peak season, but their actual volume will vary. Instawork, on the other hand, allows operators to book shifts on a weekly basis so they can scale up and down as needed rather than get locked into contracts. And when warehouses do need staff, they can get them in quickly.

“We love the Instawork model because you can get a lot of heads in the building, especially for the short-term peak.”

 

- Steven Houston, Senior Consultant at the Joshua Tree Group

Get people excited to join — & stay

Warehouse jobs have gotten a bad rap in the past, Houston said, but luckily, there have been many positive changes in recent years.

“[When] I joined Joshua Tree Group four years ago, warehouses were seen as dirty workplaces where people just moved boxes,” Houston observed.

But today, he said, warehouse environments are cleaner, shinier, and adopting leading-edge technology, which makes working there much more attractive. Highlighting the technological advancement and opportunities to learn critical skills when recruiting can help candidates see working in a warehouse as an investment in their career, not just grunt work.

Your work isn't done once you hire somebody, though. With notoriously high turnover rates in the warehouse industry, retention needs to be a top priority. 

Houston recommended using short- and long-term incentives to keep people engaged, motivated, and showing up for work. Some ideas might include a bonus for each week a staffer stays on, or food and parties if you hit certain goals.

“People want to know that you care about them,” Houston said. “Having some fun things can help you create an environment where people actually want to come to work.”

 

Optimize workflows to boost productivity & throughput

While the pandemic-driven labor shortage has shaken things up, Houston said, the greatest challenge the warehouse industry faces is still the same as before: “How do we get more out of the same labor and move units faster? In other words, how do we become more efficient?”

As a consultant, Houston often starts by asking questions like “Do we need this process?” and “Is this the best way to do this work?” Often, he said, he finds inefficiencies that clients don’t pick up on — in their minds, it’s just how things are done. Houston recommended examining workflows closely to identify places you can make improvements, even if they’re small. This might include adding a sign with instructions or removing the number of steps needed for each pick.

“If you remove the number of decisions an associate has to make every single day… you're taking away [seconds] and increasing your throughput,” he explained.

And while a few seconds might not seem like much, these little time-savers can add up to hours across the team — which will help your staff reach their full potential.

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