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Wage and bonus increases seen as necessary to attract warehouse talent

Berkshire Grey survey finds executives bullish on automation to offset labor shortage

More than three-quarters of supply chain executives believe wages and bonuses will need to be increased to attract and retain warehouse workers moving forward.

The survey, conducted by warehouse automation and robotics firm Berkshire Grey, found that 76% of surveyed executives believe wages will need to rise and 63% said they’ll need to increase bonuses to attract and retain workers. Those same executives pointed to automation as a way to minimize some of the future workers’ concerns.

“Labor issues across industries continue to vacillate, but unlike the temporary shortages seen in other industries, continued eCommerce growth and shifts in generational employment preferences are uniquely impacting the fulfillment industry and predicted to lead to long-term labor shortages that will only compound in the coming years,” said Steve Johnson, president and COO at Berkshire Grey. “In addition to compensation strategies, companies need to utilize robotics automation in order to stay ahead of this demographic shift. Not only is it a huge attractor for young talent due to the increased safety and specialized upskilling it enables, it is also a game-changer in terms of cost reduction, throughput and ROI.”

The survey found that 71% of execute believe robotics automation is necessary to counter reduced applications from younger generations. Just 13%, though, say there are using robotic automation. More than half (51%) are in the process of adoption or planning to adopt.

A majority of executives (51%) believe the use of automation will increase employee satisfaction and 43% believe it will lead to a decrease in employee turnover. Those figures align with an earlier study from Lucas Systems that found 74% of warehouse on-floor workers said they would consider taking a pay cut to work at a company that utilized technology to help them in their job. More than 2 in 5 workers believe robots will reduce physical stress (46%) or help them achieve better speed (44%) or accuracy (40%) in item picking, the survey found. In addition, 90% said they believe technology is a critical driver in employee attraction and retention.

The Berkshire Grey study noted that 64% of supply chain officers believe there is a generational difference in employment preferences that is fueling a shortage of workers. With the lowest birth rate in U.S. history combined with Baby Boomers retiring, the executives are concerned about filling future jobs, especially in the more labor-intensive e-commerce fulfillment space.

More than three-quarters (78%) of executives expect to save more than 10% on order fulfillment costs as a result of robotics automation, the survey found. Most executives (85%) currently using robotics are planning to increase their investment, with the most likely deployments coming in packaging/labeling (62%), item sortation (59%), returns (58%) and goods retrieval (58%).

The results are based on a survey of over 200 senior-level supply chain decision makers in the U.S. at e-commerce and retail businesses. 

Click for more articles by Brian Straight.

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Brian Straight

Brian Straight leads FreightWaves' Modern Shipper brand as Managing Editor. A journalism graduate of the University of Rhode Island, he has covered everything from a presidential election, to professional sports and Little League baseball, and for more than 10 years has covered trucking and logistics. Before joining FreightWaves, he was previously responsible for the editorial quality and production of Fleet Owner magazine and fleetowner.com. Brian lives in Connecticut with his wife and two kids and spends his time coaching his son’s baseball team, golfing with his daughter, and pursuing his never-ending quest to become a professional bowler. You can reach him at bstraight@freightwaves.com.