Shifting demographics, slowing economy present challenges for materials handling industry
FKI Logistex's North American president discusses major trends affecting the materials handling industry.
By Bob Trebilcock, Editor at Large -- Modern Materials Handling, 12/19/2007
The last few years have been good to the materials handling automation industry. Industries such as retail have built and expanded facilities to support the growth of their businesses and added automation to improve productivity.According to Steve Ackerman, president of FKI Logistex North America, going forward, the industry is facing some challenges and opportunities. Ackerman identified three major trends impacting materials handling users and the materials handling industry.
1. Changing labor demographics
All kinds of businesses are having trouble attracting and keeping qualified personnel. That is especially true for manufacturers and distributors as the baby boomer workforce prepares to retire. The generation following them is less willing to stay put in one job forever; what’s more, many of the employees going to work in factories and distribution centers are the newly-arrived for whom English is a second language.
“What that means is our customers need to look to automation to get repetitive motion jobs out of the warehouse because there are fewer people who want to move cases at the end of the line,” says Ackerman. “At the same time, with high turnover and communication issues in the DC, we need to create quicker, more effective training courses and technologies that can operate in multiple languages. We need trouble-shooting and diagnostic screens that are less verbal and more intuitive.”
Ackerman adds that while there is less skilled labor in the warehouse today, automation systems are getting more complex to operate and maintain. Those two trends are at odds with one another, Ackerman says. “As an industry, we need to do a better job of setting expectations with clients who are entering into highly-automated projects,” he says. “They understand the capital investment. They also have to understand the people investment.”
2. A closer alliance between industry and academia
Last summer, Ackerman attended a conference for the materials handling industry and the academic community sponsored by the Material Handling Industry of America and CICMHE. He was struck by how little dialogue was going on between the industry developing the materials handling systems of the future and the academics training the next generation of practitioners.
Ackerman believes the industry should proactively coordinate with academia on curriculum and skill sets. He also believes the industry needs to reach out more effectively to students.
“If you go back to those changing demographics, we’re going to have to work harder to recruit and retain talented people,” says Ackerman. “One way to do that is to have solid college programs. Another way is to support graduate programs and create internships to bring talent into the industry. That’s an area where we can work together.”
Ackerman says some community colleges are already looking for industry input for their engineering technology programs. “We don’t have that same level of cooperation at the university level,” he says.
3. A new economic climate
It’s not just homeowners and consumers who are having a tougher time borrowing money. Industry is also facing its own credit crunch and reduced confidence levels.
“I am already seeing signs of a slowing market for automated systems in the U.S.,” says Ackerman. “A lot of the momentum in our industry has come from the wholesale and retail distribution environment. With consumer confidence levels shifting, large capital projects are in a wait-and-see mode.”
It’s not all bad news, however. Ackerman believes there are opportunities for the industry outside of the United States. “Canadian industries just got a 50% increase in their buying power with the decline of the dollar,” he says. “They should be looking at automation projects to improve their competitiveness.”
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