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Logistics sector ready for the challenge of National Minimum and Living Wage rises

INCREASES to the minimum and living wage – the largest in a decade – are set to have a significant impact on the logistics sector.

The National Living Wage is, as of April 1, £11.44 per hour – a rise of almost 9.8%. Similar increases have taken effect for workers aged 21-22 and for those aged 16-20.

The changes are focusing the minds of the sector’s employers on strategies to manage the increases while improving their efficiency and remaining competitive. And the issue took centre stage at a Logistics Round Table event in Northamptonshire featuring major players in the sector.

The discussion was organised by Northampton-based recruitment specialist ACS Staffing Solutions, chaired by Clare Bottle, chief executive of the UK Warehouse Association, and hosted by third party logistics operator Europe Warehouse at its facility on the Midlands Logistics Park in Corby.

“Yes, these wage increases will affect us but we are continually focused on being innovative, streamlining our operations, improving efficiencies and ultimately the service we provide for our customers,” said Dionne Redpath, the company’s chief operating officer and head of the warehouse division for Europa Worldwide Group.

“At Europa, it is not just about pay. It is about creating the right culture and values in an organisation and the best environment to retain the best talent and enable them to flourish. It is a competitive jobs market.”

The logistics sector directly employs 1.8 million people across the UK, who with others in associated logistics roles in other sectors make up 8.2% of the UK workforce. However, attracting young talent into the sector is crucial for its future, the panel said.

It is an issue that is being addressed by the Generation Logistics Campaign. Fellow panel member Charlotte Patrick – founder of the Northamptonshire Logistic Awards – said: “We need to open up the doors more on our industry – it is largely a hidden industry and that is the bit that we need to bring to life.  People think we are just moving boxes or driving a forklift.”

Main picture: (from left) Charlotte Patrick, Darren Twiselton, Clare Bottle, Phil Courtney (general manager, Manual Distribution Centre Network at John Lewis Partnership), Chris Wright of ACS Staffing Solutions and Dionne Redpath.

Darren Twiselton, head of managed services at ecommerce logistics specialist Zig Zag, added: “I started out in this industry because my dad worked in warehousing and I worked with him in the summer holidays.  Lots of people have similar experiences.”

“It is not just driving a forklift or a van – there is so much cool stuff going on in these sheds.”

Europa Worldwide runs regular focus groups and surveys to give its employees a chance to air their views and ideas. “We provide a lot of support to people working in the environment – employee engagement programmes and ensure we make the environment as fun and engaging as possible,” said Dionne. “It is a balance.  Employees can still choose where they want to work and we have to do everything we can to attract them,”

She added: “It is absolutely essential to help young people understand the opportunities that are available within the logistics sector.   We need people to recognise what happens in these buildings, Covid helped open up the conversation but we need to show young people this is an exciting sector and a broad one to come into.”

The roundtable discussion was organised as part of the UKWA’s Year of Warehousing campaign. Its chief executive Clare Bottle said: “This roundtable really highlights the huge opportunities and diversity across our industry at a time of continued change such as changes to the Minimum and Living Wage, and the demand for innovation and creativity.”

ACS managing director – managed services Chris Wright said: “With logistics impacted by increased costs as well as these wage increases the coming 12 months is hard to predict. Our customers are looking at a range of different strategies to navigate increased costs while maintaining competitiveness.”

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