The document discusses the talent shortage facing the logistics and supply chain industry. It outlines several key points: 1) The industry is experiencing shortages of skilled workers at both entry-level and managerial positions due to factors like retiring baby boomers, fast-changing technology, and lack of interest from young people in logistics careers. 2) One major challenge is the ongoing shortage of truck drivers, which could grow to 240,000 by 2022 if demand continues rising at its current rate. 3) To address these shortages, companies are exploring new sources of talent like veterans, people with disabilities, and non-English speaking workers. They are also collaborating with educational institutions and associations to develop

1. ISM August 201520
Identify gaps and opportunities in recruiting and development
processes, and look to new sources of talent to fill labor
shortages in the logistics side of the supply chain.
The LOGISTICS WORKFORCE
Talent Crisis
By Lisa Arnseth

2. ISM August 2015 21
I
n a perfect world of commerce, there would be skilled
workers clamoring for job openings in the logistics,
warehousing and distribution fields. New college grad-
uates with advanced training skills would interview with
numerous organizations before choosing the best fit, and
older workers might even hold off retirement long enough
to pass along legacy knowledge to the workforce.
We don’t live in that perfect world.
The reality: The talent pool for these fields is small and
not enough people are suiting up to dive in. Technologies
are advancing quickly, federal regulations are strict and the
aging workforce is beginning to retire. According to the United
States Census Bureau, by 2025 more than 60 million members
of the baby-boomer generation will have exited the workforce,
but in that time only an estimated 40 million new employees
will begin their working careers. That deficit has industry
management in all sectors very concerned.
In logistics and supply chain, the most immediate chal-
lenge is the fast pace of change surrounding the skills com-
panies need to operate increasingly sophisticated equipment
and systems, says George Prest, CEO of the Material Handling
Institute (MHI). “Supply chains today require a broad set of
skill sets that cross over all functional operations at local and
global levels, and we need a well-trained workforce to operate
the leading-edge equipment that’s reshaping the landscape,”
he says. “Our top challenge is increasing the awareness that
supply chain is a career choice that’s on the cutting edge of
technology and innovation. It’s an exciting and rewarding
industry and one that has not always received the consider-
ation it deserves.”
Michael Mitkitka, CEO of the Warehousing Education and
Research Council (WERC), agrees that young people may not
be attracted to careers with the word “warehousing” in their
DNA, because the preconception is these jobs involve little
more than “moving boxes around on forklifts.”
“In our industry, we have a challenge attracting talent
because it’s not always clear to people what these careers
entail,” says Mitkitka. “It’s especially true for the front-line
and technically skilled positions. No college students want
to talk to an organization like ours with warehousing in our
name, but they will later in their careers when they realize the
opportunities to be strategic, to drive out costs and increase
efficiencies in just that one link of the supply chain.”
A Serious Shortage
The talent shortage isn’t just happening with entry-level
positions. According to the 2015 19th Annual Third-Party
Logistics Study by Dr. C. John Langley Jr. of Pennsylvania
State University, and by Capgemini Consulting, Penske
Logistics and Korn/Ferry International, mid- and senior-level
positions in logistics and supply management careers are
lacking the necessary talent. Why? Because the role of the
supply management practitioner is expanding to include more
strategic positions within organizations beyond operational
functions, and companies are losing managers in leadership
roles to competing 3PLs, manufacturers, retailers and con-
sulting companies.

3. ISM August 201522
And there cannot be a serious dis-
cussion about the labor/talent crisis
in supply chain logistics without
mentioning the ongoing truck-driver
shortage. Trucking is the primary
freight mode in North America,
moving 69.1 percent of all domestic
freight tonnage in 2013. The industry
handles the majority of all NAFTA
trade, moving 55.4 percent of trade
with Canada and 65.4 percent of all
trade with Mexico, according to the
American Trucking Association (ATA).
The 2015 19th Annual Third-Party
Logistics Study notes that if freight
demand continues to grow at the cur-
rent rate, by 2022 the driver shortage
could grow to nearly 240,000 drivers.
The ATA recommends that to keep
pace with demand, approximately
100,000 drivers need to be added to
the trucking workforce annually over
the next decade.
There are a number of reasons the
trucking industry has been hit particu-
larly hard. For one, many experienced
long-haul truck drivers are nearing
retirement, and an increase in safe-
ty-related regulations (including limits
on how many hours a driver can be
behind the wheel) have, in many ways,
cut into productivity for the existing
driver pool. As with warehousing,
young people tend to shy away from
jobs as professional truck drivers. And
because in most states, professional
drivers need to be at least 21 years old
with strict insurance requirements,
it means drivers need two years of
experience behind the wheel. New
high-school graduates who could
become drivers end up taking other
career paths.
Align Supply and Demand in
the Workforce
From warehouse workers to truck
drivers, the struggle to find people
for these crucial positions is very
serious. “Access to talent can be as
much of a constraint for business as
access to capital or raw materials,”
says Prest. He notes that some of the
more progressive companies in the
logistics fields are starting to take a
supply management approach to their
talent challenges, “which makes a lot
of sense when you consider that it
really is about aligning supply and
demand in your workforce.”
According to Prest, that supply
management approach involves
determining how many people are
needed, with what skills, and when
and where they are needed. “This
thought process seems to help com-
panies truly understand the problem,
identify gaps and opportunities in
their own recruiting and development
processes, and justify the invest-
ments they need to make in order to
improve,” he says.
In trucking and logistics compa-
nies, recruiting efforts are starting
to include social media and creative
advertising to draw in new talent,
with the promise of higher wages
and a range of bonuses. It may mean
a higher cost of doing business, but
trucking companies recognize that to
find and retain the best talent, they
will need to pay for it.
Don’t Fear the Teacher
Those in management usually
understand the importance of con-
tinuing education, training and certi-
fication to grow one’s career, but in
some cases they might frown on it for
their own employees — consciously
or subconsciously. “We hear some
people say that their bosses are afraid
to support training initiatives because
there’s a chance the employees might
leave for better opportunities,” says
Mitkitka. “But we want bosses to
consider this: Are you doing the best
thing for your organization if you do
not provide training opportunities? If
you’re not helping develop the best
employees with relevant skills and
access to the latest training, you’re
really not going to be retaining the
best employees.”
Mitkitka says exposing employees
to the best practices of other compa-
nies and industries in both manufac-
turing and nonmanufacturing fields
through attendance at conferences,
trade shows or achieving professional
certifications can open their eyes to
innovative new ways to improve per-
formance. There is always a chance
that as employees network with other
professionals, they may be lured away
to other companies, but overall Mitkitka
believes the gains of stepping outside
the company’s four walls to learn new
best practices far exceed the risks.
“You might be in manufacturing,
but if you hear a retailer speak about
a process, you might find it valu-
able in what you do,” says Mitkitka.
“There’s a benefit in seeing how other
companies are handling, for example,
their shipping and receiving. If I’m a
widget-maker and I’m only looking at
what other widget-makers do, am I
really giving myself the benefit of the
real best practices out there?”
Tap Different Populations for
Talent
If you continually pump one well
for water over and over for years, the
well will eventually dry up. The only
solution is to find a new place to dig
a fresh, new well. It’s the same thing
for logistics labor: The time to look for
new wells of talent is now.
This could mean intensifying your
company’s efforts to recruit from pop-
ulations whose primary language
might not be English. According to
Mitkitka, WERC conducted a survey
in 2014 and found that many respon-
dents’ organizations did not neces-
sarily support multilingual education.
“Depending on your location, in order
to expand your workforce you may
need to consider targeting a non-
English-speaking population. Keep
an open mind and target your recruit-
ment communication efforts accord-
ingly and you may find a wealth of
talent,” he recommends.
The Logistics Workforce
Talent Crisis

4. ISM August 2015 23
People with disabilities is
another group that might have
been inadvertently overlooked in
the past. Several companies are
now successfully employing indi-
viduals with various handicaps
or special needs. One of the best-
known is Walgreens’ “Inclusive
Workforce” initiative, in which
Randy Lewis, Walgreens’ senior
vice president of supply chain and
logistics, spearheaded an initia-
tive to create job opportunities for
people with disabilities at a time
when the company was investing
in new technology in its distribution
centers.
In 2007, Walgreens opened a
distribution center in Anderson,
South Carolina, and specifically
targeted people with disabilities
to work at the facility. Today, up
to 40 percent of the workforce in a
number of Walgreens’ distribution
centers and warehouses have dis-
abilities of some kind.
Walgreens specifically trained
managers to ensure an inclusive
workplace where people with and
without disabilities could work
side-by-side, with no special treat-
ment or allowances. “Walgreens is
proud to say there’s no difference
in pay, no difference in terms of
expectations. This is not a charity
program. This is just the way they
do business,” notes Mitkitka.
Veterans of the military are
increasingly being recruited to
work in the logistics and supply
management fields, as well. As
more veterans return from duty in
Iraq and Afghanistan, there have
been more initiatives to employ
this highly skilled segment of the
workforce. Not only are ex-mili-
tary personnel recruited by top
corporations thanks to their logis-
tics and tactical training abilities,
but federal programs are also now
available to assist them in finding
jobs and education opportunities.
In particular, there are programs
that are making it easier for vet-
erans to earn commercial drivers’
licenses. Several trucking compa-
nies including Schneider, J.B. Hunt
and YRC Freight are well-known
for their ambitious veteran-hiring
initiatives, many of them teaming
up with the U.S. Chamber of
Commerce’s Hiring Our Heroes pro-
gram to connect with veterans and
provide training and onboarding
to get these individuals ready for
careers behind the wheel.
Collaborate and Innovate
One thing is certain: No one can
solve the talent shortage challenge
alone. Whether it’s working with
existing employees to offer devel-
opment opportunities or reaching
out to students and untapped seg-
ments of the workforce, all of these
things require a willingness to be
flexible and cooperate with others
to achieve long-term goals.
“Whatever your supply chain
challenges, collaborate with
industry associations, universities
and educational institutions, your
suppliers and partners,” says Prest.
“That is the best way to identify the
best solutions as you develop your
next-generation supply chain.” In
the case of MHI, the association is
working with a number of compa-
nies, the National Center for Supply
Chain Technology Education
(NCSCTE) and the Manufacturing
Skills Standards Council to create
training and certification pro-
grams for supply chain automation
technicians.
According to a 2013 study
by the NCSCTE and California
Community Colleges Center of
Excellence, a supply chain auto-
mation technician specializes in
the operation and maintenance of
warehouse and distribution-center
equipment. Nearly 80 percent of
businesses surveyed for the study
employed at least one supply chain
technician, and 30 percent said they
would increase that number over
the next two years — meaning that
the industry will need to add 61,000
more supply chain technicians by
the end of 2015. The development
of training and certification pro-
grams for these skilled positions
should help fill the need.
Finding creative solutions by
working in tandem with others
could be the key to solving this
complex, multilayered talent
challenge. Industry associations
such as MHI, WERC, the American
Trucking Association, the National
Organization on Disability, the
Wounded Warrior Project and
Institute for Supply Management®
are just a few groups that can
provide resources, networking
opportunities, certification, and
comprehensive research and
data to help companies develop
solutions. The important thing is
reaching out and taking action now,
says Mitkitka.
“The speed at which supply
chain innovation is being adopted
— coupled with rising consumer
expectations for anytime, any-
where service — is stressing
traditional supply chains to near-
breaking points,” says Prest.
Companies that fail to innovate or
to take the talent shortage seriously
now will face intense struggles in
the near future.
As more companies make cre-
ative strides in finding the right
talent, it’s important not to slow
down in these efforts. Technology
is leaping forward faster than ever
and new markets are expanding
around the world. While none
of these labor challenges can be
solved overnight, they will not go
away, either. ISM
Lisa Arnseth is a senior writer for Inside
Supply Management®
.
© Institute for Supply Management®
. All rights reserved. Reprinted with permission from the publisher, the Institute for Supply Management®
.