Automation will create warehouse jobs: JLL

Automation will create warehouse jobs: JLL

8 March 2019

The Age reports this week that up to 46 per cent of jobs in Australia will be automated by 2030, dramatically changing many jobs as we know them and raising unemployment by up to 2.5 per cent.

However, two American logistics veterans claim that fully automated warehouses will actually require more blue-collar workers—at least until robots get far more sophisticated, says the AFR.

“Warehouse jobs in American have grown by 400,000 over the last few years while retail jobs are down 140,000,” said Rich Thompson, international director of supply chain and logistics solutions for real estate giant JLL.

“Labour demand from logistics facilities has gone way up and the overall logistics jobs market is way up,” said Mr Thompson, who advises multibillion-dollar global companies on their logistics and supply chain strategies.

Fears about deep job cuts in warehousing have increased since Coles announced plans to spend almost $1 billion on two new state-of-the art fully automated warehouses and set aside $146 million for the cost of redundancies and exiting existing leases.

But while Coles may require less personnel to operate its warehouses in the coming years, Mr Thompson said demand for “pick-and-pack jobs” had boomed from online retailers delivering direct to customers, a scenario which should also play out in Australia.

“E-commerce has exploded the demand for logistics jobs,” said Mr Thompson who recently visited Australia along with fellow American executive Craig Meyer, JLL’s president of industrial.

The pair said automation was great at moving pallets around and getting them to people, but the technology had not yet been developed that could pick out a specific pair of shoes, a red golf shirt and other items and pack them in a box to be delivered to a customer.

“If you order a red golf shirt and you get a blue one instead, that’s a problem,” Mr Thompson said.

Mr Thompson said one of the most influential decisions for corporate occupiers when it came to site selection for new warehouses was choosing a location where they can get access to labour.

“The rapid growth of e-commerce has changed the game of fulfillment. In a “traditional” distribution centre, one that would replenish retail stores for example, a 500,000-square-foot facility might employ 100–150 workers,” he said.

“A similarly sized building, but one focused on fulfilling individual customers’ online orders, might employ 3 to 10 times as many people (during peak seasons) and require a higher skill set. Movement from palletised shipments to more frequent, smaller, individual orders results in more “pick and pack” or case picking, which is far more labour-intensive.

“These factors have made attracting and retaining labour one of the most influential determinants of distribution centre site selection today,” he added.