Warehouse jobs were supposed to be the future of the retail industry, offering opportunities for displaced employees and reshaping the American workforce.
Amazon, Target, Walmart and other companies pledged to create hundreds of thousands of these positions at competitive wages — and increasingly with perks like free college thrown in— so they could fill the deluge of online orders that began with the pandemic and continue unabated.
But the industry is facing an unexpected problem: Far too few people are willing to take on the often-grueling work, according to industry officials and economic data. It is the latest sign that the job market is being buffeted by unexpected trends that are leading workers to reconsider the types of positions they want—and upending industries across the economy.
”Every year we say, ‘Wow, this is really difficult’ — and every year, it gets more challenging,” said Sabrina Wnorowski, vice president of human resources at Radial, which operates fulfillment centers for brands such as Cole Haan, Aeropostale and the Children’s Place.
The company, she said, is offering daily raffles with prizes like PlayStations and iPads, as well as pizza parties and on-site food trucks in a bid to attract 27,000 warehouse workers this year, up 30% from 2019.”Given high unemployment, you’d expect that it would be easy to attract labor,” she said, “but it’s been the opposite.”
The warehouse industry has already cycled through millions of workers, some of whom say they’ve sworn off warehouse jobs altogether. That, labor economists say, is creating new challenges for retailers scrambling to fill crucial jobs unloading trucks, picking orders and delivering packages.
The warehouse and transportation industry had a record 490,000 openings in July, a gap that experts predict will widen in coming months.
The dearth of willing workers is hitting companies just as they’re preparing for a fraught holiday season. Supply chain hiccups, shipping delays and out-of-stock products are expected to cut into retailers’ sales and profits, and analysts say staffing shortages make the outlook even more uncertain.
The number of seasonal postings advertising “urgent” or “immediate” vacancies on the jobs site Indeed has grown tenfold from a year ago, according to company economist Ann Elizabeth Konkel.
Aldi has bumped up the average starting pay at warehouses to $19 an hour. Walmart is promising extra pay for supply chain employees who show up to all scheduled shifts. And Sleep Number is offering sign-on bonuses of as much as $1,000 at distribution centers in Ohio and California, plus free mattresses for all new hires.
The country’s largest retailers are going a step further: Walmart, Target and Amazon announced this summer that they would begin offering free college tuition and textbooks to employees.
”There is a lot more urgency this year,” Konkel said. “But on the flip side, when we look at job seeker interest, we’re really not seeing a rebound. ”
In interviews with more than a dozen current and former warehouse workers across the country, nearly all described being overwhelmed amid staff shortages, with few prospects for moving up.
Many spoke of 60-hour workweeks and requests to take on even more shifts during the peak holiday season. Some longtime employees — particularly those who worked through the early days of the pandemic — say they resent newcomers who are being wooed with large signing bonuses and higher wages. But even those incentives, they say, haven’t been enough to keep workers from leaving.
”People quit every single day,” said David, who works at an Amazon fulfillment center in Washington state and asked to be identified by his first name only because he fears retribution at work.
”The job is brutal: 10 hours on your feet,” he said. “Half the people quit after their first day.” A spokeswoman for Amazon declined to comment on the worker’s claim or on the company’s overall turnover rate.
Labor experts say the nation’s 1.5 million warehouse jobs have been reshaped by the industry’s biggest player, Amazon, which has 950,000 U.S. workers, making it the country’s second-largest private employer.
Amazon, according to experts, has had a mixed impact on local job markets. The company has created hundreds of thousands of fulfillment jobs, often at better pay than what’s offered in the local community.
At the same time, critics say, it also has dragged down working conditions and wages for the warehouse industry, where starting pay has generally been higher than in other sectors, including retail and hospitality.
In counties with an Amazon warehouse, turnover is often double the national industry rate, according to the National Employment Law Project.
”Once Amazon gets to town, turnover skyrockets and wages decline,” said Irene Tung, senior researcher and policy analyst for the National Employment Law Project. “Amazon is the standard-bearer, and it is dragging down working conditions for everybody.
”The company, which pays a starting hourly rate of $15, often requires employees to work 10-hour shifts with rigid quotas. A recent Washington Post analysis of Occupational Safety and Health Administration data found that rates of serious injury at Amazon are nearly double those of other U.S. warehouses. And this summer, officials in Washington state concluded that there was a “direct connection” between injuries at Amazon warehouses and its “employee monitoring and discipline systems.”
“Employers have to wake up to the fact that these jobs are not sustainable,” Tung said. “People can’t stay, because they get injured or because their bodies just give out.”
Barbara Agrait, a spokeswoman for Amazon, said the company has invested hundreds of millions of dollars in injury prevention, including a staff of nearly 8,000 safety personnel and ongoing training tools and technology.
”The safety and well-being of our employees is always a top priority,” she said in a statement. “When setting [employee] expectations, we take into account things like time in role, experience and their safety and well-being.”
She also noted that many employees look to Amazon for short-term work “to make some extra income when they need it.
A “large percentage” of workers, she said, are “rehires,” though she declined to share specifics. The company, which is hoping to hire 125,000 warehouse and logistics workers before the holidays, is offering $3,000 bonuses and starting hourly wages of as much as $22. It also recently dropped marijuana testing requirements.”
Coming out of COVID, there’s been a major shift in the willingness of workers to take on jobs,” said David Niekerk, a former vice president of human resources for global operations at Amazon. “The volume of workers [warehouses] are looking to hire are pretty staggering at a time when the whole country seems to be having trouble staffing.”
Hiring 100,000 each
Walmart is looking for 20,000 logistics workers ahead of the holidays, while UPS, Kohl’s and Target are planning to hire about 100,000 apiece. But labor experts say actually finding those employees will be tough in a labor market where there are already more job openings than unemployed Americans.
”Employers came into this holiday season already deep into a labor shortage,” said Andrew Challenger, senior vice president at staffing firm Challenger Gray & Christmas. “It’s slamming every industry, but particularly positions in retail, transportation and warehousing — those are by far the hardest jobs to fill right now.”
Four months into his job at a warehouse in El Paso, Ricardo is already thinking of quitting. He makes $10 an hour preparing orders for customer pickup and delivery, and says he’s exhausted.”
I feel like I’m doing the work of six people,” said Ricardo, who asked to be identified by his first name because he fears losing his job. “You know when you’re worked to the bone, and you just want to go home, eat and sleep? It’s like that all the time.”
Analysts note that warehouse and delivery workers are under increased pressure this year, given widespread product shortages and shipping delays that are complicating an already stressful environment.
“Workers are exhausted, and they’re working very physical jobs,” said Ellen Reese, chair of labor studies at the University of California at Riverside. “Add in the long hours and quick pace of the holiday season, and that can lead to a lot of additional risks.”
In Colorado, uniform company UniFirst has for months been posting job openings promising life insurance, employee discounts and weekends off. But so far, hardly anyone is interested.
”We are overwhelmed, understaffed and without applicants,” said a driver for the company, who spoke on the condition of anonymity because he fears losing his job. “The only applicants we’ve been getting are middle-aged men in their 50s and 60s. When we do get anyone younger than 30, they’re usually here no more than a month.”
While competitors have raised wages, starting pay at the facility remains $15 an hour, he said.
UniFirst spokesman Adam Soreff said the company provides competitive pay and benefits. But “like many companies in today’s market, we are operating in a difficult and challenging environment.
”The employee said he is trying to keep pace by clocking 14-hour shifts, five days a week. But after 18 years in the industry, he’s considering leaving it altogether.
“Morale is low,” he said. “Nearly every day, I’ll sit in my car for 10 minutes in the employee parking lot and say to myself, ‘Just get through another day.’ ”
Abha Bhattarai, The Washington Post via Bloomberg.
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