Salaries for warehouse workers in Russia have sharply increased
According to a study published on the IBC Real Estate commercial real estate agency’s website. According to the published data, in 2023, the highest salary increases were observed for loaders, pickers, and warehouse workers (+85% from the previous year), forklift drivers (+72%), and warehouse managers (+45%). Alcohol companies and marketplaces are among the most generous payers for such positions, with salaries starting from 85,000 and 90,000 rubles, respectively. The salary surge is attributed to a shortage of personnel in this market segment, with a shortage of workers reaching almost 30% in the first ten months of this year. Overall, about 85% of companies in Russia are experiencing a shortage of personnel, mainly in blue-collar professions.
According to representatives of recruiting agencies, there is currently an excess of job vacancies compared to the number of applicants. For example, the number of job offers from industrial enterprises increased by 122% in the last year, setting a record among other sectors of the Russian economy.
A similar trend is observed in the logistics industry. If, in the past, seven applicants applied for a single job vacancy, now the number has decreased to three. The most in-demand profession is that of a warehouse worker, with the number of related job offers on the hh.ru recruiting website exceeding 185,000 advertisements from January to October 2023.
The rapid development of online commerce during the pandemic led to a sharp increase in the number of marketplaces, which, in turn, required the expansion of warehouse capacities throughout the country. From 2018 to 2022, the volume of these capacities almost doubled, from 2.28 to 4.03 million square meters. As a result, a large number of warehouse vacancies were created, and their filling was negatively affected by COVID-related restrictions, the depreciation of the ruble, and a decrease in migration flows.
“The logistics operators, marketplaces, and large retail chains are poaching employees from each other, overheating the labor market. It is most challenging to find candidates with secondary vocational education. Warehouse specialists such as storekeepers, pickers, and product labelers, as well as warehouse management system (WMS) operators, work in warehouses,” says Irina Pak, HR Director of the pharmaceutical 3PL operator NC Logistic.
Factors influencing the filling of vacant positions also include subjective factors. Most warehouse complexes are located outside large cities, near federal highways and transport hubs. In these conditions, businesses have to look for employees in small towns or settlements nearby. However, local residents prefer to find work in large cities or work on a rotational basis, where salaries are much higher. Additionally, gender restrictions (mostly men are hired for warehouse positions) and the natural aging of the population contribute to the limited pool of potential candidates.
“Today, more than 60% of workers in the logistics warehouse industry are over 50 years old. According to Sberbank’s data, by 2035, people aged 25 to 50 will constitute only 34% of the country’s population,” Irina Pak cites statistical data.
Moreover, the behavior of the leaders of most marketplaces creates an additional problem in the job market. In an attempt to outplay competitors in the competition for employees, electronic platforms allow candidates to be hired without a labor contract. This allows warehouse staff to work on a flexible schedule and not be tied to a specific workplace. However, this practice contradicts Russian legislation requirements and negatively affects industrial discipline.
Due to a shortage of employees in warehouses, salaries have increased significantly
Employers’ Offers
In these conditions, warehouse operators have to compete for every worker by raising the average salary in the market and enticing potential candidates with various social perks.
In the Moscow region, just a few years ago, a warehouse worker, on average, earned 40-45 thousand rubles. Today, the salary for this position starts at 120,000 rubles per month. Warehouse management system (WMS) operators are also in demand, with an average salary of over 100,000 rubles per month in the Moscow region. Other sought-after professions include loaders, pickers, and product labelers, forklift drivers, foremen, and shift supervisors.
“In the competitive struggle between enterprises, when production needs hands right now, companies are willing to raise salaries to the level of profitability for the business. Without people, the business will collapse, but entrepreneurs cannot afford to pay themselves at a loss for long, especially if there are no reserves from previous years. The last few years have been generally worn out, so few have anything left,” believes Alexander Ivanov, co-founder of the online course platform Skill2Go.
In addition to high salaries, many companies are inventing additional ways of motivation. They are offering bonuses based on annual or quarterly performance, guaranteed career growth, vacation supplements, and a thirteenth-month salary. Workers are also given the opportunity to create their own work schedules.
For example, at the company “Baikal-Service TC,” transportation for employees is organized, and each newcomer is assigned a mentor who helps the worker get accustomed to their responsibilities on-site. There is also a “bring a friend” promotion, where a bonus is paid to the person who brought in each new employee. The company has a developed reward system based on the results of internal competitive competitions, and the recruiting system is outsourced, allowing the search for new personnel throughout the country.
The Future is Near
Despite these measures, experts believe that the future of the warehouse market lies in automation, citing the example of the world logistics leader, the American company Amazon.
The implementation of advanced IT solutions will reduce business dependence on labor market issues and simplify the process of storing, assembling, and shipping products to consumers. Most warehouse operations are standard and, with proper organization, can be replaced by automation. For example, at the company “Snow Queen,” the use of automated technologies in sorting and packaging completed orders resulted in a 15% reduction in the share of employees in 10 months.
However, this is a lengthy process. It will require additional qualifications from the personnel, increasing the time for training and corresponding preparation. Simultaneously, the technologization of the warehouse process will lead to an increase in the cost of logistics services, which businesses will have to include in the retail price of the product. Moreover, only large companies will be able to afford this.
Thus, in the coming years, there will still be a shortage of skilled workers in the warehouse business. The convenience of ordering goods with home delivery will help maintain turnover in the e-commerce sector, which will require new warehouse facilities and, consequently, additional hands. The competition in the labor market will persist, and the rise in salaries in this segment will remain a decisive argument for attracting and retaining hired personnel.
By Alexey Zotov