Demand for labour in logistics sector still on a tear thanks to crazy sales

Singapore

THE conflation of an e-commerce boom and prolonged border closures has driven up demand for manpower in the logistics space, even as companies turn to automation and technology to improve their operating efficiency.

"Salaries in the sector have increased at a faster rate compared to the overall rate of salary growth," said Lee Quane, ECA International's regional director of Asia. "This includes China and Singapore - 2 locations in the region where the e-commerce boom has been most pronounced."

A FairPrice spokesperson noted that they have had to "double up" on their efforts to address manpower issues since the start of the pandemic while J&T Express Singapore's CEO Andrew Sim said they had to look to new avenues to hire talent. "Previously, we had the opportunity to work with Project Gem @ East Coast to tap on their network to fill different positions including warehouse assistants and drivers," he said.

According to data from job platform FastJobs, the number of jobs posted in the warehousing and logistics category for the first 9 months of the year has increased 35 per cent from a year ago. Compared to 2019, the number of jobs posted has increased 65 per cent. Jobs in the sector include warehousing assistants, forklift drivers, packers, logistics coordinators, storekeepers, customer service and drivers.

"We've seen demand for workers in warehousing and logistics grow steadily even before Covid," said Lim Huishan, general manager at FastJobs Singapore. "This is due to the overall growth in e-commerce and the ongoing push for retail digitisation."

Covid, unsurprisingly, has increased demand for labour, and the sector was one of a few that saw sustained growth in job openings even throughout the "circuit breaker", said Lim.

But even after the short-term surge, there has been sustained and heightened demand in this space.

Looking specifically at Q3 figures, there was a 67 per cent increase in the number of jobs posted for warehouse packers versus the same period last year. Median salary per hour is now S$10, compared to S$8 last year.

Postings for warehouse administrators, meanwhile, have doubled, with median pay increasing modestly, from S$1,800 to S$2,000.

Postings for delivery drivers in Q3 of this year were 8 per cent below the number of ads posted for drivers last year as that was immediately after the "circuit breaker", when job activities saw a rebound.

"Notable is the increase in median salary, from about S$2,200 to S$2,500 in 2021, as companies try to hire more," said Lim.

Hays Singapore's manager for supply chain and logistics, Belinder Kaur, said the company has seen a "spike in demand" for roles in logistics and distribution, as well as third party logistics companies. They see up to 200 ads per week for jobs in this space.

Companies are expanding aggressively as they ride this wave.

J&T Express has experienced double-digit growth in parcel volume over the past 2 years, especially during shopping seasons, said Sim.

On Nov 10, the company announced the opening of 2 new warehouses in Singapore, at Changi Airfreight Centre, and Penjuru.

The new fulfilment centre at Penjuru will help J&T Express meet the growing demand for e-commerce warehousing solutions within Singapore, while the new warehouse at Changi Airfreight Centre will serve as a strategic hub for trans-shipment within the J&T network, including Singapore, Indonesia, Vietnam, Malaysia, Thailand, the Philippines, Cambodia and China.

Cainiao Network, the logistics arm of Alibaba Group, too is actively looking to expand its footprint in the region. On Nov 9, they announced a long-term plan to establish its smart warehouse network throughout South-east Asia.

Currently, their last mile network in Singapore includes partnerships with local partners such as Singapore Post, Roadbull and Park N Parcel, which gives them a comprehensive last-mile network comprising over 1,600 collection points, 600 couriers, and 500 lockers islandwide.

"We are constantly looking for ways to better serve our customers, and our partnership with the supply chain business unit of FairPrice Group - Grocery Logistics of Singapore - is an example of this," said Chris Fan, head of cross-border for Singapore at Cainiao Network.

"We witnessed the increasing demand for bulky goods shipment with more Singapore customers shopping on Taobao and Tmall for their home furniture, and thus saw the need for us to expand and strengthen our logistics services in Singapore, specifically for bulky goods delivery."

Perhaps unsurprisingly, Cainiao relies heavily on a digital infrastructure to optimise their operations.

"For example, to better cope with the continual growth of e-commerce in the region, we have worked with Lazada to develop the Apollo system... (which) was created to enhance parcel processing capacity by 10 times during peak periods such as 11.11. It is integrated with e-commerce and logistics partners, culminating in a 50 per cent increase in delivery accuracy and 10 per cent reduction in average cost through smart order splitting, route optimisation and pricing technologies," said Fan.

For J&T Express, training is a key component of their hiring and retention efforts.

"We pride ourselves in constantly upskilling our team, and we place great emphasis on ensuring that our employees are empowered to be involved in different levels of the business beyond their own business unit," said Sim.

"We also equip our operations team with technical skills through software learning courses focusing on data analysis and system management. For drivers who are always on-the-go, we have digitised our training modules so that our drivers can access them easily via their phones."

FairPrice, meanwhile, has actively varied their workforce mix to include casual workers and homemakers where feasible.

This is in addition to leveraging technology and upskilling their workforce.

"FairPrice ensures that employees' welfare benefits are competitive and in tandem with economic and market conditions. Not only do we leverage our own and network resources, we also enhance our retention strategy by strengthening the engagement of our existing workforce and differentiating what we offer to attract new hires and reconnect with former workers," said the spokesperson.

ECA's Quane said he expects salaries in the logistics sector to continue to increase at a faster clip compared to other industries in the short term.

"This trend is likely to continue in the short-term as the growth of investment alongside new entrants and competition in the sector are likely to stimulate the demand for labour, with companies likely to offer higher salaries in order to attract and retain talent," he said.

Added FastJobs's Lim: "E-commerce has changed the face of retail and it has also changed the patterns of labour demand. Fulfilment of online orders is a critical part of the online buying experience, and so this means that pickers, packers, warehouse assistants, delivery workers continue to be sought after."