Automation in Logistics

12th December 2018

In this week’s blog we hear from one of our Senior Consultants, Alex Muir. He specialises in the Intralogistics market, making him the perfect person to help us reflect on the trends within automated logistics and warehousing at present. We’ll explore the way automation is starting to grow within logistics as well as how Alex feels the industry will continue to change as technology constantly improves.

I started off by asking Alex if he’d picked up on any trends or growth in intralogistics and automation within the years he’s been in recruitment. “We’ve definitely seen growth from a recruitment stand point, especially in the Asia-Pacific & Australasia regions as well as Europe and North America where we focus our intralogistics recruitment services. Globally the Logistics Automation market has seen a 12.3% growth in compound annual growth rate over the last twelve months, which is forecasting to increase considerably over the next 5 years. This statistic alone shows the direction key decision and opinion makers are expecting the logistics industry to move towards, which is why there has been such a significant investment into automation in logistics and warehousing.”

I went on to ask Alex what direction the industry would take in the short and long term future, did he see warehousing eventually being fully automated? Is he expecting new technology to take over logistics in general? “Short term, I can’t see automation taking over just yet. The cost is still too high and technology isn’t quite there to fulfil roles that require a human touch. If we start to look 20 or 30 years down the line I think we’ll see a completely different picture, I would expect warehousing to be nearly fully automated and the way new technology is evolving with the introduction of artificial intelligence (AI) will play a big role in this too. The automated logistics industry was worth around $40 Billion in 2017, whereas projections show the industry being worth over $85 Billion by 2023 displaying how huge the investment into automated logistics will be in the future.” I asked further about new technology and how that might affect people working within the industry. “Research and development is the key driver at the moment, we’ve seen new technology, products and services specific to logistics come on leaps and bounds in the last 10 years. I think the investment into research and development is going to continue to increase. This is driven mainly by the customers: Retailers, the e-Commerce businesses, and the automotive industry- they’re all looking to provide a better service in a shorter timeframe. The only way that can be achieved in the logistics and warehousing industry is by investing into the research and development of automation and I would expect this to continue.”

I was curious to see how Alex thought this prediction would affect him and other recruiters within intralogistics and warehousing, because if he’s right and people slowly get phased out to make way for automation this would surely put him out of a job? “Well for the time being, it’s a great industry to recruit within. As the investment grows and the market continues to be profitable, more and more companies are looking to expand their teams and bring in senior level individuals to advance their own operational and commercial business – giving myself a larger industry to tap into. Some of the work we’ve done at JBAndrews has been across industries as well, we’ve taken people who work directly within logistics automation manufacturers and placed them with third party logistics companies to help advance their contract logistics and supply chain operations and services.”

I continued to ask Alex about the increase of robotics and AI, circling back to the question of if these up and coming technologies will eventually put him out of the job. “There no denying the industry is gradually becoming less manual and more automated, therefore we’d expect to see a decline in physical human activity, but I don’t foresee that being the case any time soon. I think there will definitely be more innovation in products and services but at the end of the day companies will always be run by people and they will always need top talent in senior positions, were JBAndrews as an executive search firm specialises, so I don’t see this affecting our business model.”

Let us know your experiences and thoughts on this highly important topic!

Jeremiah Bavington, Marketing Manager