Strong online sales spur warehouse expansion
Logistics companies went on a hiring spree in November to handle the holiday surge in online shopping, adding thousands of jobs picking items off shelves in warehouses and delivering packages to customers’ homes.
The warehousing and storage sector, which includes the fulfilment centres where workers pick, pack and ship e-commerce orders, added 8,100 jobs in November, the most the sector has added in a single month since December 2015, the Labor Department reported Friday.
November marked the eighth straight month of expansion in a sector that has boomed as more people buy goods from e-commerce giants such as Amazon.com Inc. On Cyber Monday this year, shoppers spent $6.59 billion online, nearly a billion dollars more than last year, making it the biggest online shopping day yet, according to software company Adobe Systems Inc.
Those gains come as the broader jobs market logged strong growth across sectors ranging from manufacturing and health care to construction. Overall nonfarm payrolls added 228,000 positions—more than economists had expected—and the unemployment rate held at 4.1%, a 17-year low.
Job growth accelerated in the transportation sector, bolstered by strong manufacturing activity and increased freight demand from retailers.
Trucking payrolls grew by 1,800 in November as carriers riding a resurgent freight market scrambled to find more drivers in a tight labour market. In November, average rates for refrigerated transport and for dry vans, which haul everything from consumer electronics to clothes, hit a three-year high on the spot market, where shippers book transportation on a daily basis, according to DAT Solutions LLC.
Many large trucking fleets are raising driver pay, and expect hiring to get harder as more truckers retire or leave for jobs in industries that pay more keep them closer to home, such as energy or construction.
On the delivery side, courier and messenger firms, including the parcel carriers that handle last-mile delivery of online orders, added 2,200 jobs in November.
While inventories dipped last month, factory orders are rising and production sped up in November, the time of year when orders typically drop off, according to the Institute of Supply Management.
Imports are also up at the nation’s top ports of entry, Los Angeles-Long Beach and New York-New Jersey, where combined October cargo volumes rose 2.5% year-over-year. December imports at major retail container ports are expected to increase 1.5% compared with the same month in 2016, according to the Global Port Tracker report, released monthly by the National Retail Federation and research firm Hackett Associates.
“Retailers are doing last-minute restocking as consumers head toward the finish line of the shopping season, but the majority of holiday merchandise is already in the country and ports are beginning to quiet down,” said Jonathan Gold, NRF’s vice president for supply chain and customs policy.
Big employers such as United Parcel Service Inc. and FedEx Corp. have been ramping up hiring for months, and are also bringing on tens of thousands of seasonal staff for the holiday peak.
Deutsche Post AG’s DHL is bringing on 6,000 seasonal workers across its North American units that handle contract logistics, fulfilment, freight transportation and express delivery. It expects volume growth of between 15% and 40% across those businesses in the 2017 holiday season.
“On Black Friday we saw about a 20% increase in volume” shipped through DHL’s outbound logistics network, “and 25% on Monday,” compared with the same period in 2016, said Lee Spratt, chief executive of the company’s e-commerce division.
With report from WSJ
