An unexpected surge in online sales this holiday season has led to some shipping delays across the country.
Despite the hassle for mail rooms, an unexpected benefit has emerged — more better-paying jobs in the retail industry.
On-time delivery rates for UPS ground packages fell to 93% for the week of December 14-20, down from 97% for the same period last year, ShipMatrix, a software company that tracks package deliveries, told Business Insider.
FedEx’s on-time rates were 95% for that week — the same rate as last year.
Both companies typically deliver about 97% of packages on time during non-peak months.
To remedy the delays, UPS is expanding its vehicle fleet by renting U-Haul trucks and it’s delivering packages on Sunday — when UPS is typically closed — to keep up with demand. UPS said its on-time shipments increased to 97% last week, with some customers getting packages earlier than promised.
FedEx executives last week described this holiday season as the company’s busiest in history, and criticised retailers that are clogging the system by failing to package goods in smaller boxes when possible.
“We’ve experienced record-breaking demand during this peak season largely driven by the rapid growth of e-commerce,” Mike Glenn, CEO of FedEx Services, told analysts on an earnings call. A FedEx spokeswoman told Business Insider the company is “working hard to absorb the extra volumes” and customers will get their shipments by Christmas if they purchased an item and selected the FedEx Ground delivery option prior to December 17.
While the surge in online purchases may be overwhelming some mail rooms, it’s a welcome development for retail warehouse workers.
Walmart, Target, and Best Buy have all reported unprecedented online demand this holiday season, and they are hiring thousands of staffers to work in new fulfillment centres — where online orders are packed and shipped — across the country.
These positions typically pay more than the average retail job. Target’s warehouse workers make $18.23 an hour — one of the highest starting hourly wages in the retail industry and more than twice what the average retail associate makes, according to data compiled by Glassdoor.
A job advertised for an Amazon fulfillment center in Lexington, Kentucky, is promising as much as $17 an hour. Workers on a retailer’s sales floor, by comparison make $9 to $10 an hour, according to Glassdoor, which tracks wages using data provided by employees.
Warehouse workers can start at a higher salary than store associates because of the “specialised nature of the job,” Walmart representative Ravi Jariwala told Business Insider. Working in a fulfillment center requires more technical skills, such as handling equipment and learning to use technology for processing orders, Jariwala said.
Walmart’s average warehouse associate makes $14.22 an hour, compared with $9.31 for a retail worker, according to Glassdoor. Jariwala says the retailer’s warehouse jobs often come with perks like healthcare and retirement plans.
To be sure, this isn’t a shift with broad economic consequences. The jobs are typically seasonal (Amazon’s posting says the $17-an-hour wage will apply to workers who stay through December 26), and the fulfillment centres typically aren’t in big urban markets.
But both wage and job growth for warehouse works is outpacing that of traditional store associate jobs, according to data from the Bureau of Labour statistics.
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