After surging demand for warehouse employees, companies are now laying off those they hired. The Wall Street Journal’s Paul Page reports:
Warehousing employment fell to the lowest level in more than a year as companies slashed payrolls amid a downturn in the goods-moving economy.
U.S. employers cut 11,800 warehouse and storage jobs from February to March, according to the seasonally adjusted Labor Department preliminary jobs report released Friday. Warehousing companies have reduced employment by nearly 50,000 jobs since June, when overstocked retailers started paring inventories because of wavering consumer demand.
Employment at U.S. warehouses surged by nearly 700,000 jobs from April 2020 to June 2022, as widespread lockdowns early in the Covid-19 pandemic sent homebound consumers rushing online to buy goods. Companies from e-commerce giant Amazon.com Inc. to smaller logistics operators scrambled to fill jobs at fulfillment centers.
Warehousing and storage employment fell to 1.91 million jobs in March, the fewest number of jobs in the sector since January 2022, when companies employed 1.88 million workers.
Last month’s decline in warehousing came as U.S. employers overall added 236,000 jobs in a labor market that is showing signs of cooling. Goods-producing companies that ship through logistics distribution networks cut payrolls by 7,000 jobs last month, and employment in the retail sector declined by 14,600 jobs.
Freight demand has slowed sharply since the middle of last year as consumer spending pivoted from goods to services and big retailers coping with overstuffed warehouses began reassessing their expanded logistics networks. E-commerce sales, which helped feed a boom in warehouse construction and hiring, made up 14.7% of all retail purchases in the U.S. in the fourth quarter of 2022 after peaking at 16.4% of sales in the second quarter of 2020, according to Census Bureau data.
Real-estate analysis firm CoStar Group Inc. said new warehouse construction starts fell by 24% in the fourth quarter from a year earlier, reaching the lowest level since the start of the pandemic. The pullback has been hitting employment in what was, during the pandemic, one of the fastest-growing employment markets.
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