New report says labor hoarding likely reason for Inland Empire logistics employment slowdown

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SAN BERNARDINO COUNTY – A new report, published October 1, from Inland Empire Economic Forecast and Analysis says labor hoarding is the likely reason for a slowdown in the Inland Empire of logistics jobs.

According to The Economist magazine, the Inland Empire has become the warehouse capital of the world. 

The new report found that the industry has added almost 160,000 jobs since 2010 – 110,000 alone in Warehousing and Storage. 

“This means that the logistics industry has grown by almost 125% and the warehousing and storage sector alone by 10,000 or more than 600% over the last 13 years,” says the report.

Recent job losses

Yet, since December 2021, the industry has experienced employment losses of over 20,000 jobs.

The report initially speculated that the cause could be one of three things – (1) related to the national business cycle, (2) flow of goods through transportation undergoing a dramatic change everywhere, or (3) automation with workers being replaced by machines.

Labor Hoarding

The report goes on to state that none of these causes pan out after analyzing the data.

“We are therefore stuck with a mystery, but one that may have a simple alternative explanation – over-hiring due to labor hoarding,” says the report.  

RELATED: Survey finds 88% of adults in Inland Empire are concerned about lack of well-paying jobs

The researchers say that in a tight job-market, logistics companies may have tried to secure additional staff to be prepared — expecting the rapid historical expansion to continue.

“When this demand increase in logistics services did not materialize, they may have adjusted their hiring thus contributing to an easing in the labor market,” said the report.

The researchers say that this may be a good thing since the recent decline may only be a necessary adjustment to new economic realities.

To read the full report visit: https://www.cmc.edu/sites/default/files/SCNG_10_1_23.pdf

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