While salaries across much of the economy remain stagnant, supply chain and logistics professionals are seeing steady growth in pay. The reason: Skilled professionals are in high demand.
Peter Bradley is an award-winning career journalist with more than three decades of experience in both newspapers and national business magazines. His credentials include seven years as the transportation and supply chain editor at Purchasing Magazine and six years as the chief editor of Logistics Management.
News reports tell the story of flat wages across most of the economy. Logistics professionals tell a different story.
The results of DC Velocity's annual salary survey, where we ask readers about their jobs, career satisfaction, and pay, show that 62 percent of those responding received raises in 2012 and that those raises averaged just under 6 percent.
Not that 2012 was that good for everyone. About 31 percent said their salaries stayed the same, and 7 percent suffered decreases.
Overall, DC Velocity readers are well compensated. Average compensation, based on 977 usable responses, was $108,296. That's up about $2,000 from the previous year's numbers. The median income for respondents—that is, the midpoint of salaries among all of those reported—was $90,000. That means half of those responding make above that number, half below. (For a breakdown of average salaries by position, see Exhibit 1.)
Opportunities—and compensation—are especially strong for managers and executives with solid experience. "Frankly, just about every search we go through, the top talent generally has multiple opportunities to choose from," says Dave MacEachern, leader of the executive search firm Spencer Stuart's worldwide transportation and third-party logistics practice and a member of its global supply chain practice.
Supply chain professionals are also happy with their jobs and with the profession, according to the survey. Nearly 86 percent say they are satisfied with their careers, while 87 percent would recommend the profession to a young person entering the job market.
Not that the job is easy. About 77 percent of respondents report working more than 45 hours a week, and 39 percent say the amount of time they put in has increased over the past three years.
What makes it hard for many firms seeking top talent is that large companies with well-established supply chain organizations don't let top people get away easily. As Exhibit 2 indicates, it's the large companies that tend to pay best. (To provide as accurate a comparison as possible, Exhibit 2 only looks at the average salary for managers, as nearly half of all respondents are managers.)
It's at those large firms where the best opportunities for advancement lie, and where young and ambitious folks should go to cut their teeth, MacEachern adds.
"There are well-established organizations—P&G, GE, Frito-Lay, Dell—that have really institutionalized supply chain knowledge and where a lot of good people are developed," he says.
Supply chain skills have become so crucial that the chief supply chain officer has, at many companies, assumed the role of chief operating officer, MacEachern says. "That whole role of COO has almost disappeared, supplanted by the chief supply chain officer because now the plants are reporting to supply chain guys, not operating guys," he says.
WHAT EMPLOYERS LOOK FOR
What are firms looking for in supply chain talent? First on the list, says MacEachern, is leadership. "This is a function that as recently as 10 years ago was a fairly technical role, and technical skills were at a higher premium than leadership," he says. "But what we're seeing today is that the supply chain is being elevated to the executive committee and reporting to the CEO. It is very often managing 60 to 70 percent of the cost of goods sold. It is such an integral part of a company's success today. The leadership element—the ability to build a team, the ability to integrate a team, the ability to have that team working together—is so vital."
Those skills now extend to managing third-party logistics service providers (3PLs), a capability MacEachern says will only grow in importance as outsourcing becomes a bigger part of the logistics landscape. "That whole partnership model and the ability to integrate and work closely with third-party providers is huge," he says.
IT skills remain a relevant part of the supply chain executive's resume, according to MacEachern. Given the importance of technology in the modern-day supply chain, no manager can succeed and advance without a strong grounding in that area, he says.
Education pays off, too; not surprisingly, pay escalates with the level of education. Historically, though, even high school graduates who climb to management positions do quite well. That group reports an average salary of just under $88,000. (See Exhibit 3.)
International experience is another must for anyone looking to work at a large corporation, MacEachern says. "Global experience is a given for almost every assignment we undertake. If you don't have exposure and experience working in Asia, China—it's tough to move from a purely domestic role into a global role," he says.
MacEachern says that professionals with an engineering background are in particular demand. "A lot of them go into engineering, then move into the supply chain," he says.
In addition, he urges young professionals with ambitions for a career in supply chain management to spend some time in a manufacturing environment. "If we're building the perfect supply chain executive, you'd almost always like to see somebody that's had manufacturing experience," he says. "Manufacturing has now gotten to the point that everybody's engaged in pretty sophisticated continuous improvement programs—lean, Six Sigma. You get great training from a technical perspective. Moving into leading a production organization, leading an hourly group, is a great way to start a career. You could be 25 years old managing a hundred people who are all older than you. It's a great experience.
"If you decide procurement is your profession of choice, do you need manufacturing experience? No. But manufacturing keeps it wide open for you. A lot of companies want to see manufacturing in the background."
MacEachern suggests that young professionals pursue work with companies noted for their training and development programs. "If you can get in on the ground floor of one of the Fortune 200 or Fortune 300 organizations that have training and development programs, you really are going to give yourself a leg up," he says. "You probably need to make a couple of moves early on to make sure you're getting into the right company. And if you have landed in the right organization, then do your best to move across functional roles. If you're in procurement, move over to ops, move into planning, move into distribution, into transportation. Get some diversity early on. It becomes a little tougher as you get older."
MacEachern admits today's job prospects are bleak for those starting out. But he remains confident in the future of the profession. He says opportunities for logistics and supply chain professionals will only expand as more companies realize they need to improve suboptimal supply chains in order to compete in the future.
In addition, the rapid growth of online commerce demands responsive and efficient supply chains—and the professionals to run them, MacEachern says.
"One of the biggest trends we're seeing is [an uptick in hiring] in the business-to-consumer world," he says. "We're seeing a lot of activity over how to manage the back office. For brick and mortar retailers, most of the growth is coming online. There will be a lot of opportunities for people coming out of master's or undergrad programs in supply chain and logistics."
Nearly one-third of American consumers have increased their secondhand purchases in the past year, revealing a jump in “recommerce” according to a buyer survey from ShipStation, a provider of web-based shipping and order fulfillment solutions.
The number comes from a survey of 500 U.S. consumers showing that nearly one in four (23%) Americans lack confidence in making purchases over $200 in the next six months. Due to economic uncertainty, savvy shoppers are looking for ways to save money without sacrificing quality or style, the research found.
Younger shoppers are leading the charge in that trend, with 59% of Gen Z and 48% of Millennials buying pre-owned items weekly or monthly. That rate makes Gen Z nearly twice as likely to buy second hand compared to older generations.
The primary reason that shoppers say they have increased their recommerce habits is lower prices (74%), followed by the thrill of finding unique or rare items (38%) and getting higher quality for a lower price (28%). Only 14% of Americans cite environmental concerns as a primary reason they shop second-hand.
Despite the challenge of adjusting to the new pattern, recommerce represents a strategic opportunity for businesses to capture today’s budget-minded shoppers and foster long-term loyalty, Austin, Texas-based ShipStation said.
For example, retailers don’t have to sell used goods to capitalize on the secondhand boom. Instead, they can offer trade-in programs swapping discounts or store credit for shoppers’ old items. And they can improve product discoverability to help customers—particularly older generations—find what they’re looking for.
Other ways for retailers to connect with recommerce shoppers are to improve shipping practices. According to ShipStation:
70% of shoppers won’t return to a brand if shipping is too expensive.
51% of consumers are turned off by late deliveries
40% of shoppers won’t return to a retailer again if the packaging is bad.
The “CMA CGM Startup Awards”—created in collaboration with BFM Business and La Tribune—will identify the best innovations to accelerate its transformation, the French company said.
Specifically, the company will select the best startup among the applicants, with clear industry transformation objectives focused on environmental performance, competitiveness, and quality of life at work in each of the three areas:
Shipping: Enabling safer, more efficient, and sustainable navigation through innovative technological solutions.
Logistics: Reinventing the global supply chain with smart and sustainable logistics solutions.
Media: Transform content creation, and customer engagement with innovative media technologies and strategies.
Three winners will be selected during a final event organized on November 15 at the Orange Vélodrome Stadium in Marseille, during the 2nd Artificial Intelligence Marseille (AIM) forum organized by La Tribune and BFM Business. The selection will be made by a jury chaired by Rodolphe Saadé, Chairman and CEO of the Group, and including members of the executive committee representing the various sectors of CMA CGM.
The global air cargo market’s hot summer of double-digit demand growth continued in August with average spot rates showing their largest year-on-year jump with a 24% increase, according to the latest weekly analysis by Xeneta.
Xeneta cited two reasons to explain the increase. First, Global average air cargo spot rates reached $2.68 per kg in August due to continuing supply and demand imbalance. That came as August's global cargo supply grew at its slowest ratio in 2024 to-date at 2% year-on-year, while global cargo demand continued its double-digit growth, rising +11%.
The second reason for higher rates was an ocean-to-air shift in freight volumes due to Red Sea disruptions and e-commerce demand.
Those factors could soon be amplified as e-commerce shows continued strong growth approaching the hotly anticipated winter peak season. E-commerce and low-value goods exports from China in the first seven months of 2024 increased 30% year-on-year, including shipments to Europe and the US rising 38% and 30% growth respectively, Xeneta said.
“Typically, air cargo market performance in August tends to follow the July trend. But another month of double-digit demand growth and the strongest rate growths of the year means there was definitely no summer slack season in 2024,” Niall van de Wouw, Xeneta’s chief airfreight officer, said in a release.
“Rates we saw bottoming out in late July started picking up again in mid-August. This is too short a period to call a season. This has been a busy summer, and now we’re at the threshold of Q4, it will be interesting to see what will happen and if all the anticipation of a red-hot peak season materializes,” van de Wouw said.
The report cites data showing that there are approximately 1.7 million workers missing from the post-pandemic workforce and that 38% of small firms are unable to fill open positions. At the same time, the “skills gap” in the workforce is accelerating as automation and AI create significant shifts in how work is performed.
That information comes from the “2024 Labor Day Report” released by Littler’s Workplace Policy Institute (WPI), the firm’s government relations and public policy arm.
“We continue to see a labor shortage and an urgent need to upskill the current workforce to adapt to the new world of work,” said Michael Lotito, Littler shareholder and co-chair of WPI. “As corporate executives and business leaders look to the future, they are focused on realizing the many benefits of AI to streamline operations and guide strategic decision-making, while cultivating a talent pipeline that can support this growth.”
But while the need is clear, solutions may be complicated by public policy changes such as the upcoming U.S. general election and the proliferation of employment-related legislation at the state and local levels amid Congressional gridlock.
“We are heading into a contentious election that has already proven to be unpredictable and is poised to create even more uncertainty for employers, no matter the outcome,” Shannon Meade, WPI’s executive director, said in a release. “At the same time, the growing patchwork of state and local requirements across the U.S. is exacerbating compliance challenges for companies. That, coupled with looming changes following several Supreme Court decisions that have the potential to upend rulemaking, gives C-suite executives much to contend with in planning their workforce-related strategies.”
Stax Engineering, the venture-backed startup that provides smokestack emissions reduction services for maritime ships, will service all vessels from Toyota Motor North America Inc. visiting the Toyota Berth at the Port of Long Beach, according to a new five-year deal announced today.
Beginning in 2025 to coincide with new California Air Resources Board (CARB) standards, STAX will become the first and only emissions control provider to service roll-on/roll-off (ro-ros) vessels in the state of California, the company said.
Stax has rapidly grown since its launch in the first quarter of this year, supported in part by a $40 million funding round from investors, announced in July. It now holds exclusive service agreements at California ports including Los Angeles, Long Beach, Hueneme, Benicia, Richmond, and Oakland. The firm has also partnered with individual companies like NYK Line, Hyundai GLOVIS, Equilon Enterprises LLC d/b/a Shell Oil Products US (Shell), and now Toyota.
Stax says it offers an alternative to shore power with land- and barge-based, mobile emissions capture and control technology for shipping terminal and fleet operators without the need for retrofits.
In the case of this latest deal, the Toyota Long Beach Vehicle Distribution Center imports about 200,000 vehicles each year on ro-ro vessels. Stax will keep those ships green with its flexible exhaust capture system, which attaches to all vessel classes without modification to remove 99% of emitted particulate matter (PM) and 95% of emitted oxides of nitrogen (NOx). Over the lifetime of this new agreement with Toyota, Stax estimated the service will account for approximately 3,700 hours and more than 47 tons of emissions controlled.
“We set out to provide an emissions capture and control solution that was reliable, easily accessible, and cost-effective. As we begin to service Toyota, we’re confident that we can meet the needs of the full breadth of the maritime industry, furthering our impact on the local air quality, public health, and environment,” Mike Walker, CEO of Stax, said in a release. “Continuing to establish strong partnerships will help build momentum for and trust in our technology as we expand beyond the state of California.”