How recruiting and retaining talent can help to navigate ongoing challenges in the logistics sector

Transportation and logistics companies are relied upon by industries, governments, and consumers to move goods from raw materials to end consumers. Over the last few decades, the sector has powered global growth, with it now being a 9.7 trillion-dollar industry, which is expected to reach a value of 13.8 trillion dollars by 2028. 

Stacey Hayes-Allen  
Stacey Hayes-Allen

Stacey Hayes-Allen, Director of Corporate Partnerships at Arden University, explores the challenges the industry is facing and how upskilling plays a part in navigating these to ensure the industry continues its growth trajectory. 

Transportation and logistics companies are always dealing with supply chain risks and must respond to operational events, while balancing capacity daily. The industry takes risk seriously, with robust contingency plans in place, sharing resources and building partnerships across the sector to mitigate potential issues.  

But the ongoing challenges and changes have thrown some of the risk navigation off course, creating a gap that needs to be filled. According to reports, transportation and logistics businesses are currently concerned with six key supply chain risks and drivers. These include sustainability, technology, labor, changes in business models and regulation, decarbonization and ESG. Global trade, geopolitics and geoeconomic risk were other key issues highlighted for the sector.  

All these challenges tie into one another. Achieving sustainability, for instance, will require the sector to readily adopt new technologies, or an electric fleet, and thus be aware of new regulations. Adopting technology will also mean the logistics industry will continue to see increased use of robotics, automation, customer-corporate integration, and digital transformation across the entire value chain, impacting consumer preferences, products, services, and corporate structures. In turn, this will mean companies in the industry will need to change their business model to be more focused on a digital-first approach to build better collaboration. 

To navigate these challenges, the industry needs to ensure its staff can embrace the changes coming their way. Companies need to make sure they are upskilling staff to avoid creating a big gap between what the sector is demanding and what it can offer. 

Being prepared to tackle the challenges 

Labor risks significantly influence the transportation and logistics industry. The availability of workers, wage pressures and regulatory compliance issues can all impact operational efficiency and increase costs. The industry relies heavily on a diverse workforce, including drivers, warehouse personnel and logistics professionals. Challenges such as driver shortages, high turnover rates and a lack of skilled workers can cause disruptions in the supply chain, resulting in delays and service level impacts. 

Yet extensive skills shortages already exist. Earlier last month, Descartes Systems Group (DSG) released a study that revealed 76 percent of supply chain and logistics leaders across Europe, Canada, and the US are experiencing notable workforce shortages in their operations. The study, ‘How Bad is the Supply Chain and Logistics Workforce Challenge,’ showed that 37 percent of leaders felt the shortages they are facing are at high-to-extreme levels. 

Additionally, the transportation and logistics industry is not immune to the talent war facing all sectors for digitally-savvy talent. The logistics sector is particularly struggling to fill more technical positions, such as knowledge workers and manager roles, which is not really surprising considering that big business changes are on the way to address the challenges the industry is facing. So, what can be done to get ahead before the gap gets too big? 

The critical importance of upskilling silhouettes of dock workers in a container port

Effective partnerships are the cornerstone of the transportation and logistics industry, and it seems more important, now than ever before, for the industry to partner with educational institutions that can upskill staff.  

Between 2019 and 2021, there was a 40 percent increase in the number of job postings offering on-the-job training in the logistics sector, and a 45 percent rise in job postings that included career advancement opportunities beyond the initial position. Interestingly, research also indicates a sharp increase of 333 percent in job postings that require no prior experience, demonstrating how companies are becoming more open to hiring entry-level applicants or those looking to switch careers. All of this highlights the importance of training and career development as key factors in attracting job seekers to work in the logistics industry. 

Onboarding talent in entry roles, such as drivers, for instance, while allowing them to undertake qualifications to upskill into a more senior management role, not only gives incentive for people to join a company, but it will also allow talent to understand a business better while learning. This will ensure they can apply their learnings specifically to a business, allowing them to meet the unique needs of that business to help transform it alongside all the aforementioned risks and changes providing both vertical and horizontal on the job learning pathways into new and more senior roles. 

If staff know that the business will help to support their long-term career goals, they are more likely to join and stay. By offering incentives for workers to learn and develop, employers can show how they value existing talent, prepare for the skills of the future, attract new talent and, ultimately, begin to close the growing skills gap. This also solves the challenge of a business’ ageing workforce, with incentives such as career development and attracting new and younger talent by bridging generational challenges.  

By addressing these aspects, organizations can overcome the barriers to maintain a strong learning culture. This will push the workforce towards sustained success, in an environment where attracting and retaining talent is becoming increasingly challenging, as risks in the transportation and logistics sector grow harder to overcome.  

For a list of the sources used in this article, please contact the editor.  

Stacey Hayes-Allen  

Stacey Hayes-Allen is an experienced business developer, relationship manager and consultant. Driven by a passion for talent attraction, engagement and development, she has over ten years’ experience collaborating and partnering with HR functions across FTSE250 and smaller SMEs on their people strategies. Today, Stacey leads on employer relations at Arden University – ensuring that ‘real world’ learning meets the workplace needs of employers in an ever-evolving employability landscape.