Just when you thought it was safe to go back in the water…

This is an excerpt of the original article. It was written for the July-August 2021 edition of Supply Chain Management Review. The full article is available to current subscribers.

July-August 2021

We all know the old saying: “When the going gets tough, the tough get going.” It has been repeated so often it’s cliché. I’d like to suggest a variation: “When the going gets tough, leadership matters.” To say that supply chains have had a tough time of it would be an understatement. Despite the positive vaccine news here in the United States, global supply chains are not out of the woods yet.

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For more than 25 years, supply chain professionals have viewed end-to-end supply chain visibility as the Holy Grail, the key to unlocking supply chain value. With the evolving maturity of digital supply chain visibility, control towers and ecosystem commerce platforms, many supply chain professionals believe the quest is almost finished. With the Grail almost in our grasp, a new challenge has rapidly emerged as the dominant issue: The supply chain talent pool has sprung a leak. Recruiting, staff development and retention are fast becoming the critical issues in most enterprise supply network ecosystems.

In its “2021 Supply Chain Talent Insights,” Gartner noted that supply chain employees perceive the economy to be recovering more rapidly than the labor market. Gartner also noted that the percentage of supply chain employees with high intent to stay at their current organization decreased in the fourth quarter of 2020. The U.S. Bureau for Labor Statistics reports that, for the total U.S. economy, the labor market has tightened considerably with the April 2021 unemployment at 6.1%, down from 14.8% one year ago. The Organisation for Economic Co-operation and Development (OECD.org) indicates that the global unemployment rate is at 6.93% (April 2021) versus 8.69% 12 months earlier. National Public Radio reports that many vacant positions are in industries requiring in-person work, including parts of the supply chain ecosystem: delivery services and warehousing. And, while millions are unemployed, news media report employers are claiming that they can’t find workers.

What’s an employer to do?

In response to staffing challenges, companies can adjust a variety of levers including recruiting, monetary compensation, health benefits and other compensation elements and terms of employment. In the context of the “new beginning” after COVID-19, firms also need to address hiring candidate preferences for remote work, increased workplace safety, additional flexibility and potentially for childcare options. The primary challenges with these staffing levers are that they are relatively commoditized (the ability to raise wages is not unique to any firm), many indirect compensation increases represent declining return on investment (for example, increased medical coverage for orthotics may not have the sample positive impact as prescription coverage) and the persistent gap between job vacancies and unemployment rates indicates that available positions do not always meet the needs of the job-seeker.

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