New Zealand faces ‘18,000 logistics workers shortage’

26 May 2023

The logistics sector in New Zealand is facing “extraordinary challenges” as it struggles to recruit enough workers. 

Without immediate intervention, the existing labour shortage of 4,700 is projected to quadruple to 17,900 by as early as 2028, according to a new report by Deloitte and logistics group Hanga-Aro-Rau.

Rather than shortages being caused by retirements, most of the predicted shortages are likely to stem from people quitting the sector completely.

The report found that 50% of those who had already left their roles had left the logistics sector entirely. Meanwhile, some 23% of leavers left the country, while a further 14% have quit work due to the health or wellbeing of them or a family member. Only 9% chose voluntary unemployment, including taking early retirement. 

The report said: “The logistics sector has faced extraordinary challenges since the pandemic began in 2020.”

It added: “Supply chain disruption and rising fuel costs, coupled with issues recruiting and retaining staff exacerbated by the immigration tap temporarily turned off, have made the last few years immensely difficult.”

But Deloitte and Hanga-Aro-Rau found that Covid-19 has played its own role too, by prompting those workers over the age of 65 to leave the industry or retire early.

It said that because younger workers haven’t replaced those retiring in sufficient numbers (between 2020 and 2022, average annual employment in the 15-24 age cohort in logistics declined by 22.0%), worker shortages are being further compounded. Not helping this is the fact the proportion of women in the logistics sector also fell (by 14.8%), compared to pre Covid-19 levels.

The report noted: “The looming labour shortage arising from the current workforce reaching retirement age is a serious concern for the logistics industry. Stakeholders noted that without a clear pipeline from secondary or vocational providers, SMEs will continue to struggle to attract young talent and build a sustainable workforce.”

It suggested automation and technological advances should be embraced to alleviate worker shortages – especially to attract a more diverse workforce which has a smaller reliance on physical strength.

However, it also warned employers must ensure that everyone in the workforce feels ready and comfortable for any digital transformation through upskilling and training. 

The report said: “Where some employers were investing in technology for productivity improvement, they noted the importance of transitioning the current workforce to meet the changing skills required introduced by automation of some activities.”

Some firms surveyed said they had to increase the delivery of internal training programmes, specifically in data sciences and analysis. 

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