News / Covid and more freight the toxic mix driving supply chain talent challenge

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Problems from shortages of warehouse workers and drivers have been permanent in the logistics sector since the Covid-19 pandemic triggered a toxic mix of surging freight flows and a lack of resources to deal with them.

However, the problem extends further up the hierarchy: supply chain management is another segment hit by shortages, according to numbers released by LinkedIn.

Widely used for forging connections between professionals, the business web platform uses member profiles to calculate how many people leave their jobs each month.

Using average numbers from 2016 – the year LinkedIn started its calculations – as a “base separation rate”, it found the average rate for supply chain managers quitting rose 28% from 2020 to 2021, the highest rate since 2016.

Job openings suggest a similar, if not more dramatic, story: between January 2020 and March 2022, the number of vacancies for supply chain managers on ZipRecruiter more than doubled.

LinkedIn analysts attribute the rise in the number of managers quitting to two factors – burn-out and opportunities elsewhere. Both caused by the pandemic and its repercussions that put supply chain executives into a virtually constant ‘firefighting’ mode.

“The industry lost a lot of people who found logistics stressful,” said Helmut Berchtold, president & CEO of logistics recruitment specialist adi Consult.

Some observers have blamed outdated processes and a lack of investment in technology to take care of repetitive processes, as one of the sources of frustration. The high demand for supply chain experts has been the second, and possibly larger, driver, as companies are offering better compensation packages to attract qualified professionals.

According to a survey published last year, more than half the supply chain professionals interviewed were expecting a pay rise within 12 months.

The Association for Supply Chain Management’s 2022 Salary and Career Report, published on 25 May, confirms that remuneration of supply chain professionals has improved considerably. Average pay went up 9% last year, and total compensation rose on average by 12%. Nearly half the professionals (48%) had four weeks or more paid holiday last year.

The report indicates that working conditions have also improved. Two-thirds of supply chain professionals work in a hybrid or permanent work-from-home setting, it says.

The authors of the report are less alarmist about an exodus of supply chain professionals than the analysts at LinkedIn, however. They discovered that 14% of respondents found a new job, an improvement of 1% over the previous year.

“This past year brought continued uncertainty across all industry and supply chain professionals were once again under tremendous pressure to keep pace with a never-ending stream of disruptions,” said ASCM CEO Abe Eshkenazi. “Amid all these global challenges, it’s reassuring to see supply chain professionals remaining resilient and continuing to love the vital work they do, while remaining loyal to this critical industry.”

That loyalty has its limits, though. According to one recent estimate, supply chain professionals are open to new job opportunities within six months of getting their current position and Mr Berchtold agreed that job tenure had shrunk.

“We’re headed for shorter life cycles, as far as jobs are concerned,” he said, adding that in current market conditions, companies and recruitment specialists are struggling to find qualified candidates.

The ASCM has repeatedly stressed that companies have to invest in talent. While remuneration is the obvious lever, several studies indicate that supply chain professionals value other aspects, such as a flexible and/or collaborative work environment, investment in tools and technology and ongoing training.

Mr Berchtold warned that firms must ensure the concessions they offer to potential recruits are in line with their overall work and benefits culture, in order to avoid clashes down the road.

“Whatever you sacrifice in culture now is going to bite you later,” he said.