Opinion: Logistics Sector is in dire need of Reskilling/Upskilling itself

With great strides comes rapid change. It may seem like a philosophical statement but in the case of the logistics industry, swift digitisation and technological advancements—heightened by the pandemic—has unleashed massive change in this space. As the industry continues to evolve and expand globally, the demand for new skills or individuals with specialised skills is increasing exponentially so as to meet the needs of the growing and more and more specialised market.

If we go by numbers alone, the e-commerce market in India, for example, is expected to grow to over $200 billion in less than three years—a gigantic jump from a revenue of $38.5 billion in 2017. The need to hire and retain skilled, capable talent is, therefore, urgent.

Why the need to reskill or upskill?

The logistics industry has to be the only industry that tries to lower its cost base year after year, finding cheaper and cheaper ways of delivering its services, resulting in constant cost pressures on all players across the supply chain. It means that the room for errors is very low. If you have to do something twice in the logistics industry you’re already losing money.

Having employees, therefore, who know from the start what their role in the value chain is, what is expected of them, why it is important and how to go about their work in any case can help companies to save on costs. In the longer run, it can also help companies to increase revenues as their reputation as a reliable logistics partner increases.

India’s current overall unemployment rate, as of July 2023, is 7.95%. A recent report in the Deccan Herald based on an online survey revealed that 86% of employees feel that skilling or upskilling has become a crucial need of the hour and can help to increase the likelihood of finding employment.

From the Government’s standpoint, skilling has been a key focus area. Through its Skill India venture, the goal of the Government has been to build skills among the youth so as to enable their participation and contribution towards the nation’s economic growth. As the Union Minister of State for Skill Development rightly said in a recent conference, “Logistics will be an area full of opportunities for young students in the coming years… with a huge scope for investment, entrepreneurship and employment.”

For the sake of argument, one may believe the Indian logistics industry has other pressing concerns, like combating high costs and improving its LPI ranking. India’s expenditure on logistics is approximately 14% of its GDP, a much higher percentage than other countries, such as Japan and the United States, which directly impacts the competitiveness of businesses in the global market. India’s current LPI ranking stands at 38 out of 139 countries (though we did jump six spots since last year). These are important concerns, indeed, but without a skill-based supply base, there is no efficient system to sustain the fast-growing industry.

How to create a skill-based supply base?

The logistics industry must invest heavily in training programmes, and skilling, reskilling, and upskilling initiatives for professional growth. The traditional approach to recruitment—gathering people in a classroom setting—may be passé at this point, and the industry needs to be innovative to equip the workforce with real skills that are required in the constantly changing landscape.

The above-mentioned survey also revealed that 77% of employees believed that online courses could facilitate skilling and learning better. Employees using a digital and mobile training platform in Karnataka and Tamil Nadu, each studying in their own language of Kannada and Tamil respectively, were able to get onboarded and upskilled in a very short period of time. In one such case, a woman working on the outskirts of Bangalore went from being a picker-packer to a team leader in eighteen months, helped by a quicker understanding of what her work entails.

Given the current need of the hour, the Indian education system needs a complete overhaul to actually prepare the next workforce with real-world skills. If the trifecta of education institutes, start-ups and the government can offer viable skill development training, things become that much easier. If the workforce is given control of the learning process with the industry adapting to technology without fearing it, it could bring about a positive change through tailored content and courses for specialised needs.

Completing such courses will not only enhance an individual’s readiness for recruitment purposes but can also equip them with life skills. Some specific skills the industry can look to sharpen include warehouse management, transport optimisation, cold chain management, and communication skills, among others. The industry must also provide for career development opportunities within the company hierarchies to incentivise the skilling process.

In short, skilling is key for the logistics industry to keep up with the tremendous changes. By focusing on skilling strategies and retention rates, the logistics industry can develop a highly skilled workforce to build India up as a leading global logistics hub. The just-announced India-Middle East-Europe gateway, for one, will require massive numbers of well-skilled people to help make this new spice route a reality.


This opinion article is authored by Mr. Sanjay Tiwari, Co-Founder & CEO of 21CC Education. All views are personal and do not necessarily reflect those of Logistics Insider.

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