Search By Topic The Green Supply Chain Distribution Digest
Supply Chain Digest Logo

Category: Supply Chain Trends and Issues

Supply Chain News: Pandemic Slows Down Growth Warehouse Jobs and Wages


Rapid Growth in Employment and Recent Rise in Pay has Reversed, at Least for Now

Sept. 8, 2020
SCDigest Editorial Staff

The growth in US warehouse job has been extremely strong for a decade, rising from 660,000 in July, 2011 to 1.18 million in July of 2020, the most recent data point available from the US Bureau of Labor Statistics.

Supply Chain Digest Says...

Despite the massive growth in jobs over the past decade, wages for warehouse workers are up on average just 1.47% per year since 2011 – well below the inflation

What do you say?

Click here to send us your comments
Click here to see reader feedback

That's an annual growth rate of a very strong 6.63%, far beyond the annual growth in overall US job creation, growth fueled by rising imports from China and other low cost countries and the rise of ecommerce.

From July 2014 to July 2015, warehouse jobs were up a very strong 10.5%. That was followed by an even higher 11.4% jump in July 2015 to July 2016.

As can be seen in the chart below, based on BLS data, that growth has finally slowed, not because of fundamental changes in the overall dynamics but simply due to a very weak economy, with a record quarterly decline in GDP in Q2 as a result of the virus pandemic.

If fact, with the data showing only a small year-over-year decline in the number of non-supervisory warehouse jobs in July despite the massive decline in GDP, that could be viewed as showing the fundamental strength of the demand for warehouse workers.

Amazon, Walmart, Target and other retailers that have sees demand soar have been adding tens of thousands of warehouse jobs, even as demand is down in many other sectors based on fewer units shipping out the door.

The number of US warehouse jobs actually peaked in March, at 1.21 million, as the virus outbreak first was seen in the country, before starting the modest slide in the number of jobs in the sector through July.

Many shippers continue to report a shortage of warehouse employees. As a part of its recent announcement on using some new order picking machines at a distribution center in Memphis, FedEx Corp. said that the DC had more than 500 job openings it couldn't fill.



Source: SCDigest, from BLS Data

(See More Below)




The 10-year story on wages is a bit more interesting.

As can be seen in the chart below, even as demand for warehouse workers started to take off a decade ago, hourly wages (including the value of health and other benefits) says flat.

The hourly wage $16.02 in July 2011, and just $15.96 in July 2016, which would seem to throw traditional supply and demand analysis out the window.

That odd dynamic finally started to change in 2017, when by July wages had jumped to $17.12, up 8.9% from the prior year - a non-surprising catch up.

The wage rate continued to rise to $18.71 in July 2019, ultimately reaching an all-time high in April 2020 at $19.21, before falling back with the lower jobs numbers to $17.65 in July of this year.

That means that despite the massive growth in jobs over the past decade, wages for warehouse workers are up on average just 1.47% per year since 2011 – well below the inflation.

However, if you use the all-time April high of $19.21 as the reference, the average increase is a more favorable 2.43% - almost all of that, however , in just the past three years.

In 2018, Amazon announced it would institute a new $15 minimum wage (before benefits) for its fulfillment center workers, calling on other shippers to follow suit, with many such as Target heading in that direction even in not all the way there yet.

WhAny reaction to these numbers on warehouse jobs and wages? Let us know your thoughts at the Feedback section below.




Follow Us

Supply Chain Digest news is available via RSS
RSS facebook twitter youtube
bloglines my yahoo
news gator


Subscribe to our insightful weekly newsletter. Get immediate access to premium contents. Its's easy and free
Enter your email below to subscribe:
Join the thousands of supply chain, logistics, technology and marketing professionals who rely on Supply Chain Digest for the best in insight, news, tools, opinion, education and solution.
Home | Subscribe | Advertise | Contact Us | Sitemap | Privacy Policy
© Supply Chain Digest 2006-2019 - All rights reserved