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Supply Chain by the Numbers
   
 

- April 9, 2020 -

   
  Supply Chain by the Numbers for April 9, 2020
   
 

Amazon's Changing Sick Leave Policies at FCs; Ocean Containr Carriers Facing Mortal Financial Threat; Amazon Suspending Its Own Parcel Service for Merchants; Warehouse Jobs Jump while Massive Layoffs in Rest of Economy             

   
 
 
 
 

5

That is how many hours pay workers at Amazon fulfillment centers receive if they are sent home after new temperature checks started for all employees entering the FCs – that after previously offering no wages for such workers. That is just one of a number of policy changes at Amazon relative to workers in the face of the coronavirus crisis – policies that apparently are changing very rapidly, and drawing complaints from a growing number of workers. Amazon has said it will provide up to two weeks of paid sick leave for all full- and part-time employees who show symptoms, have the virus or are in quarantine. The company is also offering unlimited unpaid time off for all hourly employees through the end of April. According to an article on cnbc.com this week, several Amazon employees who have the virus or are in quarantine say they haven 't been paid. Those who have been paid say they're only getting 60% of their regular weekly pay. However, NBC notes, other Amazon workers said they've had no issues getting paid while in quarantine. SCDigest observes that administering such a program across Amazon's huge workers pool would be a challenge indeed. An Amazon spokesperson told CNBC that the company is "working with employees to gather the information we need to approve" extra paid sick time.

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5.0%

That was how much FedEx stock jumped early this week the day after a report from the Wall Street Journal said that Amazon was going to temporarily suspend its nascent service of taking over parcel shipping for merchants on its Amazon Marketplace channel. UPS shares were up 4.2%. The issue? Amazon needs to deploy all the human and vehicle resources it has to keep up with surging demand for consumer staple goods being ordered on-line in the midst of the coronavirus crisis. The parcel service, known as Amazon Shipping, was available in just a handful of US cities. It worked by inducting merchant parcels directly into its own network, which could then by delivered by Amazon itself, UPS or the United States Postal Service, perhaps moved close to the final shipping area on an Amazon truck or plane. FedEx ended its relationship with Amazon in 2019. So why would its stock jump? Because it reduces the       threat that Amazon would take the business away from FedEx at these Amazon merchants, which sell through Amazon but manage their own fulfillment and shipping.


 
 
 
 

212

That was the huge number of voided ocean container ship sailings this week – up from an already substantial 45 cancelled sailings the week before. Demand for imports is falling rapidly due to the virus, following weakness on the supply side as the coronavirus spread in China starting in January. Those latest financial shocks come asthe carriers were already losing money in the face of very weak rates for years. Lars Jensen, chief executive of Copenhagen-based SeaIntelligence Consulting, says that right now "all carriers are facing mortal risks." SeaIntelligence estimates the biggest international carriers will see combined losses ranging from $800 million to $23 billion this year. If the losses come in anywhere near the upper end of that range, the results will be catastrophic. Alfred Hartmann, the head of Germany's large ship owners association, warned that repayment of some shipping loans "will turn out to be problematic."

 
 
 
 

8200

That is how many warehouse jobs were filled in March, even as companies shed workers in huge numbers in other sectors, according to data from the US Bureau of Labor Statistics last Friday. That news comes as some retailers such as Kroger, Amazon and Walmart are seeing huge spikes in demand from customs stocking up and in some cases hoarding food and other basic goods to ride out the coronavirus crisis. Overall, the US has lost some 10 million jobs in the last couple of weeks. Labor demand is "off the charts" at distribution operations handling essential products, said Brian Devine, senior vice president of logistics-staffing firm ProLogistix. Devine said companies are asking to bring on 40 to 100 new warehouse workers at a time, with some employers telling workers "this is not a temporary job." A number of retailers have raised hourly wages for DC workers by $2.00, at least temporarily, increasing the attractiveness of jobs in DCs.

 
 
 
 
 
 
 
 
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