Supply Chain by the Numbers

- July 27, 2017 -

  Supply Chain by the Numbers for Week of July 27, 2017

Amazon on Massive Hiring Spree; the UK to Ban Gas-Powered Cars; Walmart has Plan for Reshoring US Manufacturing; New Foxconn Factory to Bring Thousands of US Jobs



That's amazingly how many jobs Amazon said it was trying to fill this week, the vast majority for positions at its fulfillment centers. In fact, Amazon says it's planning to make thousands of offers on the spot on Aug. 2, when it opens the doors to potential hires at 10 FCs. There will be more than 10,000 part-time jobs available at sorting centers, and some supporting and managerial positions. All that with great pressure relative finding and keeping distribution labor in many if not most US markets, and now here comes Amazon hoping to pluck 50,000 workers from the existing pool. This just continues the trend: at the end of the first quarter, Amazon had 351,000 employees, a 43% jump from the previous year. By the way, those who work more than 20 hours per week are eligible for benefits that are the same as those of Amazon's corporate employees and include health insurance, retirement savings and paid leave. All this as the nation's unemployment rate is 4.4%, near a 16-year low. Also by the way, on Wednesday, Amazon's stock price closed up 1.2% to $1,052.80 per share, bringing Amazon's market capitalization to $503.2 billion, the first time it has surpassed the half-trillion mark, and about four times its annual revenue.



That's how many gas or diesel powered cars and vans will be allowed to be sold in the UK after 2040, under new rules announced by the government this week. Britain's plans match a similar pledge made this month by France, and are part of a growing global push to curb emissions and fight climate change by promoting electric cars. In the UK's case, the key factor seems to be overall pollution, which is said to be causing a variety of health issues, more so than CO2 emissions and global warming, but that may just be positioning to the public for support of the change. It turns out that Norway intends to sell only electric cars from 2025, and India wants to do so by 2030. And a few weeks ago, Volvo announced that in its 2019 model year, all its cars will either by all electric or hybrids. Are we perhaps closer than many thing to the end of the fossil fuel era? Maybe, but a lot could happen by 2040 either way. In all these proposals thus far, it appears gas-based cars acquired before the deadlines could still be operated, just no new ones sold.



That's ultimately how many new jobs could be directly created from a planned new flat panel display factory from contract manufacturing giant Foxconn – which also owns electronics manufacturer Sharp – officially announced this week for somewhere in Southern Wisconsin. The plans for the factory have been rumored for months, as Foxconn was said to be negotiating with some six different states, mostly in the Midwest. There will initially be 3000 jobs at the plant, but that could grow to a massive 13,000 over time, the company says, with a resulting 22,000 indirect and induced jobs and 10,000 construction jobs created by the new plant, which is said to involve a $10 billion investment in what will be Foxconn's first US factory. It will produce flat screens used for televisions, automobiles, health-care and other electronic devices. While the precise location has not been finalized, it will be somewhere in the areas south of Milwaukee and north of the border with Illinois. Some local observers have said the new factory will put pressure on the local labor market to support that many jobs.


$300 Billion

That's the amount of US consumer goods imports annually – out of some $650 billion overall – that Walmart says might be moved to domestic production if a roster of public policy measures were adopted. Walmart this week said barriers to US manufacturing growth include a lack of available and qualified workers, lack of co-ordination and financing to support US manufacturers, complex regulations that create high compliance costs and legal risks, and a complex and too high US tax system, and and unfaor trade deals. The world's largest retailer, which committed to sourcing $250 billion worth of U.S.-made goods in 2013, said it identified those challenges as it worked with suppliers on that program over the last four years. It's policy proposals included building vocational training programs, reducing costs for private industry to train workers, rebranding U.S manufacturing to attract workers and drive demand for domestic products, encouraging component production to close supply chain gaps, and promoting manufacturing clusters through public-private cooperation. We'll note many of these ideas are similar to recommendations from the National Association of Manufacturers (NAM). Can this work? Who knows, but hats off to Walmart for the effort.