Advancements in technology have brought forth several warehouse automation trends that will help companies maximize efficiency this year. According to recruiters in St. Louis, Missouri, the growing demand for warehouse automation is due in large part to the persistent labor shortages and supply chain disruptions that have affected just about every industry over the past two years.
However, manufacturing has arguably suffered the most. In a Deloitte survey of US manufacturers, 80 percent said they had experienced a major disruption to their supply chain during the pandemic.
COVID-19 still looms large over the supply chain, shaping warehouse automation trends through the rest of the year.
A Warehouse Staffing Agency in St. Louis, MO Shares 5 Trends Shaping Warehouse Automation This Year
Staffing agencies stay up to date on the latest warehouse and supply chain trends to provide the most accurate warehouse staffing services to both clients and job seekers. Based on their experience in the field, recruiters from the top warehouse staffing agency in St. Louis, Missouri predict the following trends in warehouse automation this year.
#1 Persistent Labor Shortages Will Drive a Need for Warehouse Automation
Just about every industry has been rocked by labor shortages since the pandemic, and the warehouse industry is no exception. We expect to see the industry address its labor shortage by stepping up the push for more automation.
The labor market for the supply chain industry is much different than it was during the peak of the pandemic. In the summer of 2020, unemployment in the industry peaked at nearly 16 percent. Last year, it was slightly more than 4 percent — a return to pre-pandemic levels. In addition to low unemployment, large numbers of baby boomers retired early during the pandemic. These people left the labor force and are unlikely to come back.
Labor costs in the industry have also increased. According to the Federal Bureau of Labor Statistics, labor costs have risen approximately 23 percent over the past five years.
In response, distribution centers and warehouses will continue to adopt more automated warehouse technologies. This trend in warehouse automation will reduce their reliance on manual labor and insulate companies from the type of massive labor market fluctuation we saw from 2020 to 2022.
#2 Warehouse Automation Technologies Will Maximize Space
Warehouses need space and lots of it. Unfortunately, commercial space at the start of 2023 is limited and expensive. According to one report, the industrial vacancy rate in the US hit an all-time low of 3.2 percent in 2022. At the same time, the asking rate for industrial property rentals hit an all-time high of $8.70 per square foot. Projections for the vacancy rate and industrial rent are expected to remain at these levels throughout the rest of the year.
In the face of limited space and high rents, warehouses and distribution centers will focus on “building up”, and the key part of that strategy is leveraging automation to optimize floor-to-ceiling storage. This will allow for warehouses to store more inventory per square foot.
Using automation to increase floor-to-ceiling storage comes as the industry shifts to more of a “just in case” model. Labor shortages and supply chain disruptions have created a lot of uncertainty, and the way to address this level of uncertainty has been to buy up more inventory. This is a major switch from the leaner “just in time” approach that was used before the pandemic.
#3 Increase Warehouse Safety with AI
Fairly or not, the supply chain has had to battle a poor reputation for health and safety. In some respects, the increased adoption of automation will help to address this reputation. Robotics are well suited to handle strenuous and repetitive tasks. Injuries caused by heavy lifting and repetitive motions will be greatly reduced as more automation is adopted. This will help to keep workers on the job, keeping them gainfully employed and mitigating the rise of both insurance premiums and worker’s compensation claims. This modernization of safety within the supply chain will likely lead to an increase in retention and a greater ability to attract top talent.
But the rise in automation will also open up new safety concerns. As it becomes less practical to keep robotics separate from human workers, there will be an increased risk of robotics-related accidents and injuries. Unfortunately, OSHA and other regulatory bodies have been slow to develop robotics-related safety standards. This area of the industry is currently self-regulated, and companies that can show a proven track record of safe robotic operations will differentiate themselves from robotics companies that cannot.
Safer robotics will be achieved through developments in sensor and AI technology. Drones and other robots that can detect signs of accidents and take actions to prevent them will be safer than those that cannot.
#4 Demand for Automated Storage Systems Will Rise
In addition to labor shortages, warehouse and supply chain operations have had to deal with ever-increasing expectations from consumers. In response, there has been an increased demand for automated storage systems, and this is one warehouse technology trend expected to continue through 2023. According to Research and Markets, as many as 50,000 robotic warehouses may be developed by 2025.
Another emerging warehouse automation trend is the increased adoption of newer forms of automation, including palletizing/depalletizing robotics and autonomous mobile robots (AMRs). The latter are expected to result in major productivity benefits. For example, rather than having employees walk carts across a warehouse, autonomous carts can transport picked orders and returns. Palletizing/depalletizing robotics will replace humans in performing heavy lifting and repetitive tasks, allowing warehouses to shift more labor toward higher-value positions.
Increased use of automated storage systems is part of a greater warehouse technology trend for more mobile robotics. A report from Interact Analysis said the market for mobile robots will increase six-fold between 2021 and 2025, to reach a value of $18 billion.
When it comes to adopting an automated storage system, warehouses have two options: completely build a system from the ground up, or use off-the-shelf components. Companies looking to build their own system will typically partner with an outside robotics firm that is experienced in designing and developing warehouse-specific robotics. This is a fairly nascent industry and so companies looking to build a system should look for established companies with a roster of satisfied clients.
Companies could also use off-the-shelf robotics to create a patchwork automated storage system. Although it may be tricky to fit together different proprietary robotics, using off-the-shelf components avoids costly design and development stages. One of the big drawbacks to this approach is limited product availability, and this issue can become acute when the time comes to expand the storage system.
#5 Growth in Warehouse Robotics & Drones
We typically associate drones with flying outside and aerial photography. But increased flying drone use is a big trend in warehouse automation for 2023. Automated warehouse drones are now capable of scanning pallets and counting inventory without human oversight. Flying drones can then connect to inventory management systems through the cloud, allowing for instant updating of inventory levels. One type of automated warehouse drone from Corvus Robotics is capable of scanning hundreds of pallets per hour and operating for weeks without needing to charge.
Warehouse operations come in all different sizes, and not every operation is capable of investing in cutting-edge robotics. Part of the growth in warehouse robotics will be the increased use of robotics-as-a-service. Obtaining robotics from a third-party provider isn’t a new phenomenon in the supply chain, but costs are forcing companies to reevaluate spending priorities. Robotics as-a-service can be a much more affordable way to leverage newer technologies that will attract new customers and realize significant productivity benefits. This approach also offers a company much greater flexibility than purchasing warehouse robots.
Fill Jobs at Your Automated Distribution Center with the Top Warehouse Staffing Agency in St. Louis, MO
These are exciting times to be in the warehouse and supply chain industries. As a longtime provider of warehouse staffing services in St. Louis, Missouri, the recruiters at Westside Personnel couldn’t be more excited about emerging trends in warehouse automation and what they mean for the industry.
Founded in 1994, Westside Personnel has warehouse temp agencies in Pacific and Fenton, MO that have seen many industry trends come and go. Through it all, we have provided unsurpassed customer service and built a reputation as a trusted staffing provider for warehouses and manufacturing companies throughout Missouri. We continue to serve our clients and job seekers with the highest levels of customer service, industry knowledge, professionalism and integrity.
Our recruiters understand that labor shortages and tight production deadlines will always be with the supply chain industry, and we’re committed to helping our clients overcome these core challenges of their business. With warehouse staffing services from Westside Personnel, you can quickly fill a few warehouse jobs to meet important deadlines, or we can help your warehouse operation locate the specialists it needs to handle a critical project.
If your supply chain operation needs warehouse workers that can handle the latest technologies while understanding legacy challenges, partner with Westside Personnel. To learn more about our services, contact our warehouse staffing agency in St. Louis, Missouri or request an employee today.