Looking for warehouse workers you can rely on? Older folks can be highly reliable and productive, provided you give them the support and benefits they need.
Contributing Editor Toby Gooley is a writer and editor specializing in supply chain, logistics, and material handling, and a lecturer at MIT's Center for Transportation & Logistics. She previously was Senior Editor at DC VELOCITY and Editor of DCV's sister publication, CSCMP's Supply Chain Quarterly. Prior to joining AGiLE Business Media in 2007, she spent 20 years at Logistics Management magazine as Managing Editor and Senior Editor covering international trade and transportation. Prior to that she was an export traffic manager for 10 years. She holds a B.A. in Asian Studies from Cornell University.
If you have anything to do with staffing warehouses and distribution centers, then you've probably given some thought to the subject of demographics lately.
Demographics? That statistics-heavy stuff you read about in social studies? Yes, indeed—and let's hope you paid attention in class that day. That's because any long-term strategy for staffing warehouses and DCs has to consider the changing demographic profile of the American workforce—or else risk being caught shorthanded.
Most likely, what you've heard on the topic has focused on today's multilingual workforce. That's something virtually all warehouses and DCs are dealing with, whether they're located in urban or rural locales. (See "¿habla warehousing?" DC VELOCITY, September 2007.)
Important as that is, it's not the only demographic issue you need to be aware of: Age should also be on your radar screen. The U.S. population is getting older; people are living longer and working longer. According to "65+ in the United States: 2005," a National Institute on Aging report compiled by the U.S. Census Bureau, the number of senior citizens in this country is expected to double by 2030, when nearly one in five Americans will be 65 or older.
Right now, that trend may not be apparent in many warehouses (youthful immigrant workers still dominate the average DC's workforce). Yet it's a big enough worry that the Council of Supply Chain Management Professionals (CSCMP) annual conference in 2007 included two sessions on "disruptive demographics," including lengthy discussions of the impact of an aging population on supply chains. At last year's Material Handling Logistics Summit, moreover, a group of business executives, material handling equipment vendors, and academics identified the impact of demographics on distribution and logistics as their top concern.
The graying of America is a trend that will affect most, if not all, warehouses and DCs. The downside, of course, is the inevitable loss of knowledge and experience when large numbers of baby boomers retire. But there is an upside, especially if you're willing to think of an aging population as an opportunity instead of a problem: Employing "over 50" workers can actually boost warehouse productivity.
16 steps to a safer workplace
The American Society of Safety Engineers (www.asse.org) suggests the following steps to make industrial workplaces safer for older employees. Though the list was created with older workers in mind, the group says the changes will benefit workers of all ages.
Improve illumination and add color contrast.
Eliminate heavy lifts, elevated work from ladders and long reaches.
Design work floors and platforms with smooth and solid decking while still allowing some cushioning.
Reduce static standing time.
Remove clutter from control panels and computer screens, and use large video displays.
Reduce noise levels.
Install chain actuators for valve hand wheels, damper levers, or other similar control devices. This brings the control manipulation to ground level, which helps to reduce falls.
Install skid-resistant material for flooring and especially for stair treads.
Install shallow-angle stairways in place of ladders when space permits and where any daily, elevated access is needed to complete a task.
Increase task rotation, which will reduce the strain of repetitive motion.
Lower sound-system pitches, such as on alarm systems, as they tend to be easier to hear.
Lengthen time requirements between steps in a task.
Increase the time allowed for making decisions.
Consider necessary reaction time when assigning older workers to tasks.
Provide opportunities for practice and time to develop task familiarity.
Older achievers
That older workers should be more productive than the young 'uns may sound counterintuitive. After all, everyone knows that as people age, they think and move more slowly, and their eyesight, hearing, and muscle strength decline. That's true, but medical researchers, gerontologists, and safety engineers all agree that it's no reason to write off the over-50 crowd in a warehouse setting. In fact, research cited by the American Society of Safety Engineers and federal health agencies shows that workers 55 and older have fewer accidents on the job than do younger people. (When they are injured, though, they often take longer to recover.)
As for why older workers outperform their younger counterparts, there are a number of possible explanations, says Brian R. Sherman, director of ergonomic services for The Ergonomics Center of North Carolina at North Carolina State University. "They have more experience, and they may have moved up in their jobs so that now they're managers, or they may be leveraging support within their group," he suggests.
Another factor in their favor: Mature workers tend to subscribe to the "work smarter, not harder" philosophy. Forty-five percent of productivity increases in warehouses and DCs comes from more effective use of time, says Jeff Boudreau, a partner at workforce productivity specialists XCD Performance Consulting. In his experience, older employees excel in this area. "They are less easily distracted, and they know how to stay on task," he says. "The more senior warehouse associates usually are at the top of the list in terms of productivity, quality, and consistency. I've never found somebody who's not been able to achieve performance incentives due to age."
That's significant, because performance standards are not adjusted for specific groups of employees, says Evan Danner, president of TZA Consulting, which develops engineered performance standards and labor management systems. "You set specific standards for different functions … but in a world of engineered standards, you cannot set different standards based on age," he explains.
What about positions that require working with technology, such as highly automated material handling equipment? Boudreau says that seniors may not always be as tech-savvy as their younger co-workers, but he strongly disputes the notion that they can't be successful in technology-related jobs. "We've tracked all different types of [warehouse] workers on training curves. Even when we have set up moving goals, we have always found that older workers progress up the training curve the same as anyone else," he says.
Sherman agrees that older folks can make the grade when it comes to mastering tasks. "A number of studies on worker performance, including research papers that compare job performance and age, generally have found no correlation—either positive or negative—between the two relative to technical competence," he says.
Hiring mature workers can be an antidote to one of warehousing's most intractable problems: employee turnover. Danner has found that older workers tend to stay in their jobs longer, particularly in a unionized environment with good pay and benefits. They usually care more about benefits than 20- somethings and are more rooted in their communities. As a result, they're less likely to change jobs when something new comes along—like the oil companies that Boudreau says are "literally poaching people in the parking lot" of a West Texas warehouse operated by one of his clients.
Not ready to hang it up
The advantages of hiring mature workers seem clear enough. But do they actually want to work? Apparently, they do. A 2004 survey of 2,300 baby boomers conducted by Merrill Lynch, pollsters Harris Interactive, and the consulting firm Age Wave found that 76 percent of the respondents planned to continue working after retirement. In an earlier study of 1,000 people aged 55 and older, conducted by Age Wave on behalf of insurance giant AIG SunAmerica, about 95 percent of respondents said they expected to work at least part time after they retire, either by choice or by necessity.
Add those findings to current worries about the future of Social Security and the state of the U.S. economy, and you can't help but expect more mature workers to be knocking on your door looking for work. That could well happen, but they won't all be looking for a 40-hour week: Only 6 percent of the respondents to the Merrill Lynch study said they would want full-time work.
Flexible scheduling and good benefits are the biggest lures for mature workers. Adjusting work flows and scheduling to accommodate part-time workers takes some effort, of course, but the benefits often make up for it. Boudreau tells of one retailer who went to high school PTA meetings to recruit middle-aged and older mothers to work in a DC during school hours; the company also gave the part-timers a discount on merchandise and made the work environment as pleasant as possible. That strategy netted the retailer a number of reliable long-term employees, he says.
Another example is that of a company that moved its DC from northern New Jersey to a rural community in the southern part of the state because of the availability of large tracts of land. It soon found that the labor pool in its new location was too small to fully staff the DC with fulltime workers. Instead, Boudreau says, the company found the reliable—mostly part-time—workers it needed among the retirees in the "55-plus" communities that were springing up in the area.
Safe and sound
Although mature workers easily match (or outpace) their younger counterparts when it comes to productivity, there's no denying that their reactions may be a little slower, their eyesight may be a little fuzzier, and they may tire a little sooner than their younger colleagues. There are some basic steps you can take to help older workers consistently perform at high levels in the safest possible environment. For a quick rundown, see the sidebar titled "16 steps to a safer workplace." Here are a few additional recommendations:
Consider each person individually, and screen carefully (in accordance with labor laws, of course). Be alert for potential problems, such as a decline in memory or eyesight, but don't assume that everyone over a certain age is unfit. "It's kind of like an upside-down funnel," explains Sherman of The Ergonomics Center. "Young children's strength capabilities don't vary much, but as we get older, capability can differ greatly among people in their 50s and 60s." Boudreau, too, cautions against stereotyping: At one client's DC, a woman in her 70s is among the most productive trailer loaders.
Pay special attention to ergonomics. Workers of different ages may be prone to certain types of injuries; read up on the research and take steps to prevent those injuries from occurring. Of particular concern: hazards that could cause a loss of balance, trips, and falls.
Take the "vision test." Look around your operation. Does it present any obstacles for someone whose vision is no longer 20/20? Better lighting and clearly readable signage improve visibility, as do uncluttered screens and larger characters on terminals and scanners.
Match employees with the right jobs. Since engineered performance standards can't be adjusted for individuals, the smart route is to place people where they're most likely to be successful, says Danner. "If a worker is over 60, I would question whether you want to put him in a pick module where he has to handle 400 cases an hour," he says. "But he could probably be very successful in a piece-pick area where weight is not a big factor and there is more emphasis on dexterity and skill."
Offer health and wellness programs for mature workers. Making those programs available is an effective way to help them stay in the workforce longer, agree all of the experts consulted for this article. Health is a major concern for even the halest and heartiest of this generation; by supporting older employees' health needs, you'll not only keep them working longer but will earn their loyalty, too.
Respect for all
Health and safety considerations aside, there are a few other factors that come into play in managing an older workforce. For instance, it's important to keep in mind that boomers and their elders have a very different way of looking at work, authority, and personal development than do the current crop of young professionals. In some DCs, there now are four generations working together— and that creates some managerial challenges.
Danner notes, for example, that friction sometimes occurs between young people with degrees in logistics or supply chain management and the older, more experienced workers they may supervise.
Yet for all their differences, workers from the various generations have this in common: they want respect. Regardless of their age or experience, they want to be treated as individuals with valuable ideas and knowledge that can be tapped for the benefit of all.
That's not something older workers can always take for granted. In some companies, there's still a tacit assumption that older folks are inflexible, uncreative, and generally less capable than younger co-workers. Therein lies an opportunity to make your DC stand out from the crowd. Give older workers what they want and need—including respect—and you could gain some of the most reliable, self-directed, and productive employees you've ever had.
CVS puts demographics to work
To see what the DC workforce of the future might look like, just go to one of the DCs run by CVS Caremark, the Woonsocket, R.I.-based drugstore chain. In 2007, 10 percent of new hires in the company's distribution centers were over 50 years old. Currently, 25 percent of the DC workforce is over 50, and in 10 years that figure is expected to top 33 percent, says Kevin F. Smith, the company's senior vice president-supply chain and logistics.
Though that wasn't planned, Smith says he's not alarmed by the trend. He believes that having older workers on the job is an asset. "Older workers are more experienced and knowledgeable, and this helps in creating a safe and productive workplace," he says.
Over the past eight or 10 years, CVS has been automating more of its operations and making ergonomic enhancements to its DCs. Smith says the retailer made that decision to improve processes, boost productivity, and lessen the likelihood of repetitive stress-related injuries in the workforce in general, but those measures have proved to be especially helpful to older workers.
The combination of efficiency and more mature workers has produced a steady increase in productivity and improvements in customer service. Smith believes that CVS's distribution centers are safer and more productive than ever. That's a tribute to all of the company's associates, both young and old, he says. But older employees have played a big role in that success. "We believe that our current mature workers add to that productivity, rather than detract from it, because of their experience, knowledge, and expertise," Smith observes. "These are associates who know our business and continually help us to fine-tune processes that help us to serve our customers better. These individuals understand the processes they work with better than anybody else and therefore are more apt to recognize ways to improve those processes."
Congestion on U.S. highways is costing the trucking industry big, according to research from the American Transportation Research Institute (ATRI), released today.
The group found that traffic congestion on U.S. highways added $108.8 billion in costs to the trucking industry in 2022, a record high. The information comes from ATRI’s Cost of Congestion study, which is part of the organization’s ongoing highway performance measurement research.
Total hours of congestion fell slightly compared to 2021 due to softening freight market conditions, but the cost of operating a truck increased at a much higher rate, according to the research. As a result, the overall cost of congestion increased by 15% year-over-year—a level equivalent to more than 430,000 commercial truck drivers sitting idle for one work year and an average cost of $7,588 for every registered combination truck.
The analysis also identified metropolitan delays and related impacts, showing that the top 10 most-congested states each experienced added costs of more than $8 billion. That list was led by Texas, at $9.17 billion in added costs; California, at $8.77 billion; and Florida, $8.44 billion. Rounding out the top 10 list were New York, Georgia, New Jersey, Illinois, Pennsylvania, Louisiana, and Tennessee. Combined, the top 10 states account for more than half of the trucking industry’s congestion costs nationwide—52%, according to the research.
The metro areas with the highest congestion costs include New York City, $6.68 billion; Miami, $3.2 billion; and Chicago, $3.14 billion.
ATRI’s analysis also found that the trucking industry wasted more than 6.4 billion gallons of diesel fuel in 2022 due to congestion, resulting in additional fuel costs of $32.1 billion.
ATRI used a combination of data sources, including its truck GPS database and Operational Costs study benchmarks, to calculate the impacts of trucking delays on major U.S. roadways.
There’s a photo from 1971 that John Kent, professor of supply chain management at the University of Arkansas, likes to show. It’s of a shaggy-haired 18-year-old named Glenn Cowan grinning at three-time world table tennis champion Zhuang Zedong, while holding a silk tapestry Zhuang had just given him. Cowan was a member of the U.S. table tennis team who participated in the 1971 World Table Tennis Championships in Nagoya, Japan. Story has it that one morning, he overslept and missed his bus to the tournament and had to hitch a ride with the Chinese national team and met and connected with Zhuang.
Cowan and Zhuang’s interaction led to an invitation for the U.S. team to visit China. At the time, the two countries were just beginning to emerge from a 20-year period of decidedly frosty relations, strict travel bans, and trade restrictions. The highly publicized trip signaled a willingness on both sides to renew relations and launched the term “pingpong diplomacy.”
Kent, who is a senior fellow at the George H. W. Bush Foundation for U.S.-China Relations, believes the photograph is a good reminder that some 50-odd years ago, the economies of the United States and China were not as tightly interwoven as they are today. At the time, the Nixon administration was looking to form closer political and economic ties between the two countries in hopes of reducing chances of future conflict (and to weaken alliances among Communist countries).
The signals coming out of Washington and Beijing are now, of course, much different than they were in the early 1970s. Instead of advocating for better relations, political rhetoric focuses on the need for the U.S. to “decouple” from China. Both Republicans and Democrats have warned that the U.S. economy is too dependent on goods manufactured in China. They see this dependency as a threat to economic strength, American jobs, supply chain resiliency, and national security.
Supply chain professionals, however, know that extricating ourselves from our reliance on Chinese manufacturing is easier said than done. Many pundits push for a “China + 1” strategy, where companies diversify their manufacturing and sourcing options beyond China. But in reality, that “plus one” is often a Chinese company operating in a different country or a non-Chinese manufacturer that is still heavily dependent on material or subcomponents made in China.
This is the problem when supply chain decisions are made on a global scale without input from supply chain professionals. In an article in the Arkansas Democrat-Gazette, Kent argues that, “The discussions on supply chains mainly take place between government officials who typically bring many other competing issues and agendas to the table. Corporate entities—the individuals and companies directly impacted by supply chains—tend to be under-represented in the conversation.”
Kent is a proponent of what he calls “supply chain diplomacy,” where experts from academia and industry from the U.S. and China work collaboratively to create better, more efficient global supply chains. Take, for example, the “Peace Beans” project that Kent is involved with. This project, jointly formed by Zhejiang University and the Bush China Foundation, proposes balancing supply chains by exporting soybeans from Arkansas to tofu producers in China’s Yunnan province, and, in return, importing coffee beans grown in Yunnan to coffee roasters in Arkansas. Kent believes the operation could even use the same transportation equipment.
The benefits of working collaboratively—instead of continuing to build friction in the supply chain through tariffs and adversarial relationships—are numerous, according to Kent and his colleagues. They believe it would be much better if the two major world economies worked together on issues like global inflation, climate change, and artificial intelligence.
And such relations could play a significant role in strengthening world peace, particularly in light of ongoing tensions over Taiwan. Because, as Kent writes, “The 19th-century idea that ‘When goods don’t cross borders, soldiers will’ is as true today as ever. Perhaps more so.”
Hyster-Yale Materials Handling today announced its plans to fulfill the domestic manufacturing requirements of the Build America, Buy America (BABA) Act for certain portions of its lineup of forklift trucks and container handling equipment.
That means the Greenville, North Carolina-based company now plans to expand its existing American manufacturing with a targeted set of high-capacity models, including electric options, that align with the needs of infrastructure projects subject to BABA requirements. The company’s plans include determining the optimal production location in the United States, strategically expanding sourcing agreements to meet local material requirements, and further developing electric power options for high-capacity equipment.
As a part of the 2021 Infrastructure Investment and Jobs Act, the BABA Act aims to increase the use of American-made materials in federally funded infrastructure projects across the U.S., Hyster-Yale says. It was enacted as part of a broader effort to boost domestic manufacturing and economic growth, and mandates that federal dollars allocated to infrastructure – such as roads, bridges, ports and public transit systems – must prioritize materials produced in the USA, including critical items like steel, iron and various construction materials.
Hyster-Yale’s footprint in the U.S. is spread across 10 locations, including three manufacturing facilities.
“Our leadership is fully invested in meeting the needs of businesses that require BABA-compliant material handling solutions,” Tony Salgado, Hyster-Yale’s chief operating officer, said in a release. “We are working to partner with our key domestic suppliers, as well as identifying how best to leverage our own American manufacturing footprint to deliver a competitive solution for our customers and stakeholders. But beyond mere compliance, and in line with the many areas of our business where we are evolving to better support our customers, our commitment remains steadfast. We are dedicated to delivering industry-leading standards in design, durability and performance — qualities that have become synonymous with our brands worldwide and that our customers have come to rely on and expect.”
In a separate move, the U.S. Environmental Protection Agency (EPA) also gave its approval for the state to advance its Heavy-Duty Omnibus Rule, which is crafted to significantly reduce smog-forming nitrogen oxide (NOx) emissions from new heavy-duty, diesel-powered trucks.
Both rules are intended to deliver health benefits to California citizens affected by vehicle pollution, according to the environmental group Earthjustice. If the state gets federal approval for the final steps to become law, the rules mean that cars on the road in California will largely be zero-emissions a generation from now in the 2050s, accounting for the average vehicle lifespan of vehicles with internal combustion engine (ICE) power sold before that 2035 date.
“This might read like checking a bureaucratic box, but EPA’s approval is a critical step forward in protecting our lungs from pollution and our wallets from the expenses of combustion fuels,” Paul Cort, director of Earthjustice’s Right To Zero campaign, said in a release. “The gradual shift in car sales to zero-emissions models will cut smog and household costs while growing California’s clean energy workforce. Cutting truck pollution will help clear our skies of smog. EPA should now approve the remaining authorization requests from California to allow the state to clean its air and protect its residents.”
However, the truck drivers' industry group Owner-Operator Independent Drivers Association (OOIDA) pushed back against the federal decision allowing the Omnibus Low-NOx rule to advance. "The Omnibus Low-NOx waiver for California calls into question the policymaking process under the Biden administration's EPA. Purposefully injecting uncertainty into a $588 billion American industry is bad for our economy and makes no meaningful progress towards purported environmental goals," (OOIDA) President Todd Spencer said in a release. "EPA's credibility outside of radical environmental circles would have been better served by working with regulated industries rather than ramming through last-minute special interest favors. We look forward to working with the Trump administration's EPA in good faith towards achievable environmental outcomes.”
Editor's note:This article was revised on December 18 to add reaction from OOIDA.
A Canadian startup that provides AI-powered logistics solutions has gained $5.5 million in seed funding to support its concept of creating a digital platform for global trade, according to Toronto-based Starboard.
The round was led by Eclipse, with participation from previous backers Garuda Ventures and Everywhere Ventures. The firm says it will use its new backing to expand its engineering team in Toronto and accelerate its AI-driven product development to simplify supply chain complexities.
According to Starboard, the logistics industry is under immense pressure to adapt to the growing complexity of global trade, which has hit recent hurdles such as the strike at U.S. east and gulf coast ports. That situation calls for innovative solutions to streamline operations and reduce costs for operators.
As a potential solution, Starboard offers its flagship product, which it defines as an AI-based transportation management system (TMS) and rate management system that helps mid-sized freight forwarders operate more efficiently and win more business. More broadly, Starboard says it is building the virtual infrastructure for global trade, allowing freight companies to leverage AI and machine learning to optimize operations such as processing shipments in real time, reconciling invoices, and following up on payments.
"This investment is a pivotal step in our mission to unlock the power of AI for our customers," said Sumeet Trehan, Co-Founder and CEO of Starboard. "Global trade has long been plagued by inefficiencies that drive up costs and reduce competitiveness. Our platform is designed to empower SMB freight forwarders—the backbone of more than $20 trillion in global trade and $1 trillion in logistics spend—with the tools they need to thrive in this complex ecosystem."