Automation technology combats labor challenges in warehousing

3PLs such as Geodis are using automated storage and retrieval to improve working conditions. Source: AutoStore
3PLs such as Geodis are using automated storage and retrieval to improve working conditions. Source: AutoStore

As labor shortages persist and fulfillment demands rise, the warehousing sector faces unprecedented challenges. According to Gartner Inc., the scarcity of skilled workers, combined with constraints on operating space and capital, is driving logistics organizations to explore innovative solutions. Among these, automation technologies are emerging as a critical strategy for addressing labor challenges and gaining a competitive edge.

By 2028, Gartner predicts that 80% of warehouses and distribution centers will deploy some form of warehouse automation.

This trend is timely, as the labor market continues to evolve. According to employers, it is estimated that 44% of workers’ skills will be disrupted in the next five years, and in Europe, nearly 30% of manufacturing and service firms cited production constraints in 2022 due to worker shortages.

Against this backdrop, automation offers a way to not only meet current challenges, but also future-proof operations. Robotics and automation, enhanced by artificial intelligence, can take over repetitive and labor-intensive tasks in fulfillment centers.

As the World Economic Forum noted in its Future of Jobs Report 2023, the shift in the “human-machine frontier” has made automation more accessible and impactful. With automation, warehousing teams can reduce dependence on seasonal and short-term workers, scale operations seamlessly, and improve overall productivity.

Chart plotting the probability that different industries will prioritize skills training versus the probability that they will adopt automation. Source: World Economic Forum
The probability that organizations surveyed will prioritize skills training in AI and big data versus the probability that they will adopt AI and the likelihood of them pursuing automation as a business strategy. Source: World Economic Forum, Future of Jobs Survey 2023

ASRS increases workforce productivity

Automation can minimize labor-intensive tasks, enabling workers to focus on value-added activities. For instance, automated storage and retrieval systems (ASRS) require minimal training and can significantly enhance the efficiency of individual workers.

By delivering goods directly to workstations, these systems can improve employee satisfaction and retention while also providing the flexibility to scale operations during peak demand periods.

Streamline operations with WMS

A warehouse management system (WMS) is another pivotal technology. This software centralizes data, optimizes pick-and-pack processes, and automates order fulfillment, improving accuracy and reducing the time between order placement and shipment.

In addition, the insights generated by a WMS can uncover hidden inefficiencies and opportunities, further streamlining warehouse operations.

Automation can enhance safety

Automation can also create safer working environments by minimizing worker movement and the physical strain associated with repetitive tasks. This reduces the risk of workplace injuries and enhances overall employee well-being, contributing to a more productive workforce.

3PL operations turn to robots

Third-party logistics (3PL) providers are at the forefront of adopting automation to navigate labor shortages and rising costs. Labor expenses account for over 40% of total operating costs for many 3PLs, making automation a critical investment.

Automated systems such as robotic picking and sorting machines can optimize space utilization in addition to improving order accuracy and speed, addressing both labor and capacity challenges.

For instance, robotics can effectively use vertical and horizontal warehouse space, mitigating the need for costly relocations or expansions. Furthermore, AI-integrated systems can enhance efficiency by predicting demand patterns and streamlining inventory management.

Flexible automation for modern warehousing

Traditional material handling equipment (MHE) automation—such as conveyor systems and automated guided vehicles (AGVs)—has been a staple in warehousing for decades. However, these legacy systems are often capital-intensive, inflexible, and tailored to specific operations.

In contrast, intralogistics smart robotics (ISRs) offer a scalable, adaptable, and cost-effective alternative.

ISRs bring intelligence and sensory awareness to automation, enabling them to operate independently or alongside human workers. These systems are particularly valuable in managing fluctuating demand, as they can be scaled up or down based on operational needs.

Moreover, ISRs often operate on an operational expenditure model, making them accessible to a broader range of organizations.


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Automated packing: A case in point

Automated packing systems illustrate the transformative potential of automation. These systems use robotics and software to handle tasks, such as sorting, sealing, and labeling, ensuring consistency and precision.

Automated packing systems operate continuously and can adapt to varying product types and volumes, all while meeting higher demand without additional labor. By minimizing human error and increasing operational speed, these systems can not only enhance fulfillment accuracy, but also drive significant cost savings.

Automation is a strategic imperative

The integration of automation in warehousing is no longer optional—it is essential. Labor shortages, rising costs, and increasing customer expectations demand innovative solutions.

Automation tailored to specific industry challenges is a powerful tool for combating fulfillment challenges. By investing in innovative technology, organizations can enhance efficiency, reduce operational costs, and improve customer satisfaction.

As Gartner emphasizes, flexible and intelligent automation solutions are the way forward. They not only address immediate workforce challenges but also position companies for sustainable growth in an increasingly dynamic market. From robotic picking systems to WMS platforms, advanced technologies are reshaping the future of logistics, one warehouse at a time.

Parth Joshi is chief product officer at AutoStore.

About the author

Parth Joshi is chief product officer at AutoStore, a leading ASRS provider. He has more than 20 years of business leadership experience and has worked at Cisco, Eaton, and Hexagon Manufacturing Intelligence.

This article is posted with permission.

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Parth Joshi