How a Lack of Workers is Impacting the Supply-Chain’s Final Mile

How a Lack of Workers is Impacting the Supply-Chain’s Final Mile

February 22, 2022 , 0 Comments

I think we’re all acutely aware of the ongoing delays and congestion within the shipping industry, however a fresh problem is now upon us as a shortage of skilled workers, vaccine mandates and COVID cases in the eastern states creates new delays along the ‘Final Mile’ – the distance from the Port to the client.

The continued sea-freight delays have started to impact landside operations over the past few months, with significant blow-outs in the time taken to unload goods from vessels, get picked up by transport companies and dispatched to clients.

It’s another perfect storm of conditions, with WA’s ongoing skills shortage being exacerbated by vaccine mandates and the hard-border, and now the escalating COVID situation in the eastern states.

Where we used to be able dispatch a client’s goods within one or two days of arrival at the Port, it’s now blowing out to one or two weeks. The industry just simply doesn’t have the manpower to move any quicker.

The flow on impact is thousands of dollars in penalties and fees as freight is forced into storage at the wharf while awaiting pick up, and empty containers sit idle awaiting return.

Transport companies are reneging on guarantees because they know they can’t maintain previous schedules and timeframes, yet they won’t pay the penalties.

The client doesn’t want to pay because the delay isn’t their fault, and so we’re left holding the bill.

While we can absorb some extra cost, we can’t wear it all.

Unfortunately, the problem is affecting the entire industry, so simply changing transport providers isn’t an option.

We’re now putting serious thought into whether we buy our own truck, but we know that would require capital investment of around half a million dollars.

The landside delays are the result of several factors;

  • Lack of Staff: Skills shortages are being felt right across the economy, with crane operators, forklift drivers and truckies among a range of vacancies needing to be filled within the supply chain. While the number of workers leaving the industry due to vaccine mandates has been small, in an already tight market, it has a big impact. COVID regulations are also forcing workers into isolation, removing them from the workforce for weeks at a time.
  • Inexperienced Staff: While companies are doing their best to recruit workers, new staff may have limited experience and training in the first instance.
  • Eastern States COVID Cases: Spreading COVID cases in the east is resulting in large numbers of workers falling ill or forced into isolation, impacting rail, road and air freight coming into the state.
  • Higher Volumes of Cargo: While less vessels are berthing at Fremantle Port, container volumes have increased from approximately 1800 boxes per ship to around 3000. This takes longer to offload and requires even more trucks to move containers.
  • Ongoing Seafaring Congestion: The sea-freight congestion of the past two years hasn’t eased, meaning consignments are often arriving at Port behind schedule.

While we’re hopeful the February 5 reopening date may provide some relief in the form of vaccinated, skilled workers, there is also the fear of an incoming surge of COVID cases.

We’ve seen the wipe out of workers on the east-coast, and there’s genuine concern that will be replicated here. If it does, it will have a huge impact and make an already bad situation even worse.

Read more here.

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