Ben Ames has spent 20 years as a journalist since starting out as a daily newspaper reporter in Pennsylvania in 1995. From 1999 forward, he has focused on business and technology reporting for a number of trade journals, beginning when he joined Design News and Modern Materials Handling magazines. Ames is author of the trail guide "Hiking Massachusetts" and is a graduate of the Columbia School of Journalism.
Talk to the venture capital firms that back logistics startups, and you’ll notice that some of them have changed their tune lately when it comes to the future of warehouse labor. A few years ago, that conversation was largely about the potential for emerging technologies like self-driving vehicles and robotic picking arms to replace humans on the road and in the DC. Some investors even talked about the rise of the lights-out or “dark” warehouse that would operate entirely without people.
Instead of planning to replace the workers on their payrolls, companies in the logistics sector are now talking about how to retain and re-educate those associates. Conversations about dark and “autonomous” warehouses have shifted to topics like “upskilling” and retraining the people already working in their facilities.
One reason for these employers’ newfound appreciation for human workers is simple necessity—with unemployment stuck at a historically low 3.7% in November, they’re struggling to fill even skeleton crews.
But there is a bigger trend at work here, one that has led to an increasing focus on employees’ workplace conditions, not just their hours and wages. In a recent trade show keynote, a professor from the University of Tennessee described rising demands by the youngest workers entering the labor market today—Generation Z—for jobs that deliver rewards beyond the simple paycheck. Sure, salary is important, but these workers also value diversity, social justice—particularly in the wake of national protests following George Floyd’s death at the hands of Minneapolis police—and sustainability.
Those younger workers are also concerned about quality-of-life issues, including the freedom to work from remote locations at flexible hours. For evidence of how important work/life balance has become, you need look no further than the recent rail industry labor strife. When railroad unions threatened to strike soon after Thanksgiving in 2022, they were demanding better workplace conditions—such as paid sick leave and more reliable schedules—rejecting a White House-brokered deal that provided them with solid pay raises.
A similar trend is sweeping through the ranks of truck drivers, according to Nishith Rastogi, CEO and founder of Locus, a California startup that operates a last-mile logistics platform. When asked what 2023 holds for the transportation and logistics markets, he predicted that the trucking industry would continue to struggle with the same issues it faced in 2022, citing examples like union strife and labor shortages. “Drivers are tired of the pressure to make daily on-time deliveries and will increasingly push back on undesirable working environments, making driver empowerment and health/wellness a necessary factor for success,” Rastogi said.
In response to the rising attention to working conditions and quality of life, some of the warehouse automation startups have pivoted to a greater focus on the role of the human worker in logistics operations. Specifically, they are looking at ways to make their autonomous mobile robots (AMRs) better “colleagues” to the people they work with and, ultimately, more valuable to the overall operation.
At a recent trade show in Boston organized by the Association for Advancing Automation (A3), a speaker from tech developer Locus Robotics emphasized the importance of sharing the data analytics generated by the company’s AMRs not only with shift managers but also with the hourly associates on the floor. According to the speaker, the benefits include opportunities to reward top workers, coach their slower colleagues, train new workers, and help existing workers learn new jobs. Pulling back the curtain on workplace statistics generates benefits at every level of the corporate ladder, it seems.
In all corners of the warehouse, workers are making their voices heard. And that’s a good thing: Business success relies on logistics professionals, whether they sit behind a desk, in the cab of a forklift or over-the-road truck, or at the controls of a robot. Supply chain is a team sport.
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The U.S. manufacturing sector has become an engine of new job creation over the past four years, thanks to a combination of federal incentives and mega-trends like nearshoring and the clean energy boom, according to the industrial real estate firm Savills.
While those manufacturing announcements have softened slightly from their 2022 high point, they remain historically elevated. And the sector’s growth outlook remains strong, regardless of the results of the November U.S. presidential election, the company said in its September “Savills Manufacturing Report.”
From 2021 to 2024, over 995,000 new U.S. manufacturing jobs were announced, with two thirds in advanced sectors like electric vehicles (EVs) and batteries, semiconductors, clean energy, and biomanufacturing. After peaking at 350,000 news jobs in 2022, the growth pace has slowed, with 2024 expected to see just over half that number.
But the ingredients are in place to sustain the hot temperature of American manufacturing expansion in 2025 and beyond, the company said. According to Savills, that’s because the U.S. manufacturing revival is fueled by $910 billion in federal incentives—including the Inflation Reduction Act, CHIPS and Science Act, and Infrastructure Investment and Jobs Act—much of which has not yet been spent. Domestic production is also expected to be boosted by new tariffs, including a planned rise in semiconductor tariffs to 50% in 2025 and an increase in tariffs on Chinese EVs from 25% to 100%.
Certain geographical regions will see greater manufacturing growth than others, since just eight states account for 47% of new manufacturing jobs and over 6.3 billion square feet of industrial space, with 197 million more square feet under development. They are: Arizona, Georgia, Michigan, Ohio, North Carolina, South Carolina, Texas, and Tennessee.
Across the border, Mexico’s manufacturing sector has also seen “revolutionary” growth driven by nearshoring strategies targeting U.S. markets and offering lower-cost labor, with a workforce that is now even cheaper than in China. Over the past four years, that country has launched 27 new plants, each creating over 500 jobs. Unlike the U.S. focus on tech manufacturing, Mexico focuses on traditional sectors such as automative parts, appliances, and consumer goods.
Looking at the future, the U.S. manufacturing sector’s growth outlook remains strong, regardless of the results of November’s presidential election, Savills said. That’s because both candidates favor protectionist trade policies, and since significant change to federal incentives would require a single party to control both the legislative and executive branches. Rather than relying on changes in political leadership, future growth of U.S. manufacturing now hinges on finding affordable, reliable power amid increasing competition between manufacturing sites and data centers, Savills said.
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.