Is the Shift from “Just-in-Time” to “Just-in-Case” Driving a New Labor Shortage?

The coronavirus, with its devastating cost in lives, global financial loss and the general disruption to our society, has exposed holes and weaknesses in any number of areas that will be studied and argued for decades.

As a long-time logistics practitioner, it’s my job to identify the holes and needs in our logistics and supply chain processes that need to be filled and may also offer opportunities for growth. I’m sure that companies and governments are already reevaluating their suppliers, supply chains and production cycles as we speak.

From “Just-in-Time” to “Just-in-Case”

The recent hiccups we’ve witnessed in procuring critical supplies leads me to believe that the United States and Canada will take steps to prevent its recurrence.

Think of it as moving from a “Just-in-Time” logistics process to a “Just-in-Case” supply chain management model.

An obvious area for improvement is the need to shorten supply chains for critical materials and supplies. Onshoring or near-shoring has been talked about for several years, but I believe we’ll see concrete action to build this practice back into our supply chains.

As we’ve quickly seen, it is vital to all of us to improve our access to critical products, not just for the supplies needed by government, but also for companies providing essential services to keep our communities healthy, stable and thriving.

Prepare for Predictable Gaps Now, Not Later

We’ll discover both weaknesses and opportunities while we are in the process of shortening these supply chains and building up our network of domestic suppliers. The ongoing labor shortage immediately comes to mind as a top priority.

The labor shortage may have all but disappeared in the near-term, but it will return. Companies are already pressed to find qualified staff in the current logistics environment, and the competition to attract and retain talent in the warehouse will only get worse in the long-term. While millions have recently lost their jobs, and no one knows when, or if, many of these dedicated people will return to their original jobs.

My prediction is that 18 to 36 months, most of those who are temporarily unemployed will return to their pre-virus industries and the labor shortage will be back in full force.

Those of you who have an Amazon Distribution Center in your area already, have been fighting for warehouse labor, already know what I mean. As onshoring grows, even companies located in non-Amazon areas will find that qualified talent will become even harder to find and more expensive to secure.

Of all the areas we can focus on, I’d like to suggest two areas that can offer relief to this warehouse labor shortage:

1. Invest in new warehouse labor-saving devices. We’ve seen a steady emergence of rapidly deployable technologies that do a fantastic job in eliminating slow, labor-intensive processes. It’s not about using technology to reduce staff – rather, it’s a good practice to reduce costs and keep employees happy.
2. Recruit staff from the labor pool being reduced by retail businesses. Most of the workers being downsized by retailers are more than qualified to work in warehouse operations both on and off the warehouse floor.

The most successful businesses will begin to look at both options as more production and distribution moves back to North America.

If you haven’t had time to explore new technologies such as voice-directed picking and the latest in mobile devices, you’ll find that these technologies are:

1. Becoming more cost-effective
2. Keep improving, and are getting easier to deploy and use
3. Are welcomed by warehouse workers who are as interested in enhancing their jobs as you are in retaining their talent.

I’ve seen tremendous change in warehouse fulfillment over the years, and I love to share the practical business insights I’ve learned about. If you’d like to talk about the technologies, software and processes that pay for themselves in a year or less give me a call and you can investigate or have your staff investigate these during the current emergency.

Rick Williams, president and CEO of Creative Logistics Solutions (CLS), is a transportation management expert with 40 years of experience in shipping and supply chain operations and technology. CLS has worked with many companies to streamline workflow and improve productivity in the warehouse through the combination of streamlined workflows integrated with multi-carrier shipping software, integrated pack/ship stations, data collection solutions and more.