By Daniela Sirtori-Cortina (Bloomberg) —
Supply chain managers quit their jobs last year at the highest rate since at least 2016 due to a mix of burnout and a desire for higher wages.
The high turnover rate aligns with escalating supply chain issues in 2021. The pandemic has resulted in the closure of manufacturing plants, relief ports and rapidly rising transportation costs. These headaches largely fall on supply chain managers, making their job much more difficult, but also more lucrative.
“With growing opportunities amid the supply chain crisis, it’s no surprise that supply chain managers are increasingly looking for greener pastures,” said Kory Kantenga, Economist senior at LinkedIn.
LinkedIn, a division of Microsoft Corp., calculates revenue by analyzing member profiles to determine how many people quit their jobs each month. The figure is compared to the 2016 average, which LinkedIn calls the “separation rate.” For supply chain managers, the average segregation rate increased 28% from 2020 to 2021, according to data compiled for Bloomberg. That’s the highest since LinkedIn started tracking the data five years earlier.
Burnout is part of the equation, Kantenga said. New opportunities are also playing a role, in part because ongoing supply chain disruptions are fueling demand for professionals who can handle them.
The number of openings for supply chain managers on the ZipRecruiter Inc. website more than doubled between January 2020 and March of this year, both because companies created more positions to meet the crisis and because labor shortages have given workers more means to change jobs. said Julia Pollak, the company’s chief economist.
Since the outbreak of Covid-19, shoppers around the world have faced empty shelves and shipping delays. Businesses have been forced to adapt to unpredictable demand, a race for scarce materials, and the stress of finding workers as their staff flock to other jobs or fall ill. And then they had to find enough trucks to get their products out. The crisis has raised the profile of supply chain jobs and the field has become a popular major for business school students.
The pandemic has triggered a collapse in “lean manufacturing,” the drive to cut costs that big business had embraced in previous decades. In practice, this meant that supply chain managers had access to just enough staff, materials, and trucks to fill average workloads. The model fell apart when Covid-19 caused unexpected ebbs and flows in orders and hampered access to essential supplies, putting planners in 24/7 fire mode.
“So many things have become the exception to the rule,” said Michael Martin, a supply chain manager in suburban Philadelphia who has held various positions at companies such as Stanley Black & Decker Inc. and Essity AB for three decades. He took a new job at Blue Yonder during the pandemic. “I think that’s where a lot of the stress comes from. We can no longer solve problems as easily as before.
The supply shortage has not been limited to products that consumers can hold in their hands. It has also affected tasks such as data collection, which contribute to bottlenecks faced by businesses and buyers.
Madhav Durbha, vice president of supply chain strategy at Coupa Software Inc., said part of the problem is outdated processes. Manual and labor-intensive operations require employees to spend hours each week performing repetitive tasks that could be automated for greater efficiency and precision, allowing people to focus on more work rewarding.
For example, Durbha said that 60% to 70% of an analytics employee’s time can be spent collecting data, while only 30% to 40% is spent analyzing numbers and providing information.
A survey released last year by recruitment firm DSJ Global showed that more than half of supply chain and procurement professionals expected their salary to increase over the next 12 months. Higher pay was the main reason American workers were attracted to new jobs.
Supply chain skills are in such high demand these days that job seekers can afford to be picky, said Emily Prendergast, executive director of DSJ. She estimates that 65% to 70% of supply chain professionals are open to discovering new job opportunities within six months of landing their current position.
“Candidates are less willing to go to a company that is outdated in systems or outdated in general processes,” Prendergast said. “They don’t want to be as stressed as they have been for the past few years.”
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