Brexit, the ‘Perfect storm’: The skills shortage for logistics and supply chain management
By Liam Fassam, Director of Supply Chain Research Centre, Senior Lecturer Supply Chain Management, University of Northampton
I write this in a rather pensive state as I begin my weekly commute from London back to Luxembourg. As the aircraft climbs out of City airport lumbering through the summer evening’s turbulence, I cannot help but think of the confusion and turmoil reigning supreme in the financial districts below, coupled with the wider impact that Brexit will have on the UK’s infrastructure and those that are so reliant upon it.
There has been much discussion over the past 10 years relating to the skills shortage within the UK across many industry sectors, including the logistics and supply chain sector, an area that arguably underpins all of the crucial infrastructure within the UK and beyond, ensuring the basic staples of life are provided for, alongside of course those wonderful things we call ‘luxuries’. This skills shortage is further compounded by the current crop of middle/senior management leading the strategic direction of the industry being of an age where retirement is a real and somewhat pleasant option (lucky them), with many companies in the sector concerned about succession planning. One example amongst a plethora of cases being abundant within industry that highlights the reality of this issue is Yodel (Topham, 2014), which collapsed under the seasonal pressures, with little capability to pull on resource to meet demand, leaving E-tailers such as Amazon with a back log of 200,000 shipments over Christmas [season’s greetings!]. This inability to fulfil the service delivery was not down to physical infrastructure challenges, but a lack of skilled staff available to serve the needs of the sector and deliver on time performance for ‘us’ the consumer.
This example of logistics infrastructure failure relating to skilled resource, cast my mind to a recent research study published through the Centre of Excellence Logistics and Supply chains (CELAS) at the University of Northampton (Gough & Fassam, 2015), findings of which supported that 55% of companies had suffered from challenges associated with recruiting people with the right skills, with 70% of participants having workers within their operations from outside the borders of the United Kingdom.
So what have skills, logistics and mobile workers got to do with the UK national economy?
Imagine a country that was part of an alliance that permitted freedom of movement, one [freedom of movement] that supported the workforce demands placed upon crucial infrastructure operations, such as but not limited to logistics. Then one day this country decides to leave the alliance, placing questions of the staff (70% associated with crucial infrastructure) that are contained within its borders working within crucial sectors supporting the nation's GDP. What happens next?
This [Brexit] leads to what I call the ‘perfect storm’ of damage to the infrastructure of UK business support, which we are simply not prepared for, and currently we have little understanding of how to remedy this issue and it is a ‘blind’ issue to much of the wider public.
One would have thought that before you pulled the plug on this crucial pipeline of skills, that one’s National infrastructure architects (Government) would have future proofed the employment skills supply chain utilising relevant resources. Simply put, no; historically school’s career officers have been an important vehicle in delivering the message upstream [near source] in the ‘recruitment’ pipe line, however the need to get the message out to school children presenting the sector as an attractive one for school leavers has been lost (Gravier & Farris, 2008). Thus engagement in training and development is extremely low. Furthermore, this fuzziness of the Logistics sector is further compounded by the UK Commission for Employment and Skills (UKCES) report ‘Careers of the future’ (UKCES, 2014) which one would logically assume would support career progression choices, but instead cites the top five careers in the sector as airline pilot, truck driver, ships officer, hovercraft operative and taxi driver. Without wishing to cause offence to those who operate in these fields, four out of the five do not even register as a critical skill in today’s logistics and supply chain environment, which leads me to assume the report is out of touch with what today’s logistics, supply chain and further UK PLC needs. Hovercrafts on Northamptonshire high streets – disruptive innovation!!!! Imagine them whizzing by!
Therefore, there is a ‘perfect storm’ brewing; we have an over reliance on mobile workforce, which was this morning (24th June 2016) effectively removed from the industry, and with no clear evidence of a sector review/ planning to back fill these crucial positions. It is not incumbent upon FE/HE alone to fill these voids and arguably without the cross sectoral research funding that has further been retracted from the logistics and supply chain education centre, we [UK PLC] are well and truly on the back foot when it comes to supporting the nations GDP progression on the global stage, and our position as a world leader.
Prior to the referendum, CELAS at the University of Northampton had identified a need to work with professional bodies such as the Chartered Institute of Logistics and Transport, and Chartered Institute of Procurement and Supply, alongside schools and colleges to create pathways of education that can be articulated clearly to students, delivering options for career and change. We will continue to do so in the face of adversity on a local and global scale, for the greater good of the industry. However, we alone are unable to make the change needed with the perception of the global industry. We alone cannot fulfil a now ‘desperate’ need from businesses and communities to take a more collaborative approach towards engagement with academia, professional bodies and governmental organisations and achieve a much needed change to avoid this ‘perfect storm’ coming to fruition.
Time to face the realities of this sector and act; BREXIT should serve as a stark warning of what is around the corner in terms of sectoral skills loss, and if we as an industry do not start to collaborate and innovate, we really will be on an irreversible spiral of commercial doom!
Gough, A. and Fassam, L. (2015) Proximity matters: shared challenges within a logistics cluster. Paper presented to: 20th Logistics Research Network (LRN) Annual Conference and PhD Workshop 2015, University of Derby, 09-11 September 2015.
Gravier, M.J. and Farris, M.T. (2008) “An analysis of logistics pedagogical literature. Past and future trends in curriculum, content and pedagogy”, The International Journal of Logistics Management, 19 (2), pp. 233 – 253, 2008.
Topham, G (2014) ‘Yodel warns of parcel backlog as Christmas deliveries face delay’, The Guardian, 12th December 2014. Available online: http://www.theguardian.com/business/2014/dec/11/amazon-yodel-christmas-parcel-delivery-backlog
UKCES (2014) Careers of the future, United Kingdom Council of Education and Skills. Available: Online. https://www.gov.uk/government/publications/careers-of-the-future