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Automation Will Be Critical To Meet Industrial Labor Shortages

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The industrial sector has historically had a tough time finding enough skilled labor—but technology may be the key.

As much as 30% of the industrial sector workforce can be replaced by tech, according to a new global logistics report by Cushman & Wakefield. In locations with higher wage costs, adopting automated solutions in lieu of headcount can have a big impact on a company’s bottom line.

“Recognizing that labor costs can be both cyclical and structural in nature and that it may take years to implement a new, long-term course for the business, companies can begin by finding ways to diversify their exposure over the short- to medium-term,” the report advises. “Either geographic or operational diversification can successfully achieve labor cost reduction allowing for a ‘wait and see’ approach ahead of any commitment to a complete and costly overhaul of production and supply chains.”

Automation has been critical in the wake of global COVID-19 restrictions to allow companies to increase efficiency and maintain productivity—and tech has also been a key component of ESG issues. Occupiers are increasing technology into warehouses to create smart buildings in response to both the search for greater efficiency and both current and forecasted labor shortages.

In the longer term, 69% of the 746 companies surveyed in the Thomas Industrial Survey in Q2 2020 reported they are looking to bring production back to North America.  And about 55% of those surveyed say they will likely invest in automation to improve production performance, product testing, quality and process control.

“Such transformations and relocations are likely to gather momentum with an increasing number of companies, especially those based in the U.S. and Europe, believing their revised labor requirements can more easily be met near or in their own countries,” the Cushman & Wakefield report notes.

The shift to automation will also require occupiers to rethink warehouse design, says Anthony Cataldo, an architect with Lowney Architecture.

“Down the road, there will be more reliance on automation, not only inside facilities but outside too,” he told GlobeSt.com in an earlier interview. “Incorporating additional power supplies are essential for buildings to adapt and prepare for future equipment and robotics down the road.”

 

Source:  GlobeSt.