News broke this week that a UPS lay off of 12,000 staff will take place, reducing their roster of 85,000 management employees and some contractors, as the carrier industry contracts. In total, UPS’ global workforce is around 500,000.
UPS has record traffic during the pandemic years, but the threat of a strike in the US saw them lose a ton of business. They say that about 60% of this lost revenue has returned, but they are still way short of the pandemic highs and indicate that these jobs will likely never be replaced even if business picks up in the future.
The UPS lay off should save the company around $1bn this year, and no cuts are planned to their workforce of drivers who are represented by the Teamsters union.
It’s likely that many carriers will face challenges this year, indeed we’ve already seen UK parcel broker Despatch Bay cease trading and Menzies Parcels shutting down. The simple reality of a troubled economy is that when people have less disposable income to spend coupled with spiralling prices, carriers are particularly hard hit with lower parcel volumes and increased costs.
We’re hearing that hear in the UK, parcel volumes are lower than expected for January – there is always a dip after Q4, but this year volumes appear to be somewhat lower than normal and that has to be a concern for carriers under utilising their infrastructure investments. It should also serve as an early warning alarm for all ecommerce retailers, large and small, to ensure that they have alternative carriers able to be brought onstream at the flick of a switch to ensure that their operations are not adversely impacted.
One Response
My experience with UPS has been diabolical.
I recently told them to delete our account.
We import very rarely but after many many incidents in which they couldn’t / wouldn’t help with payment issues and being passed from tech to customer services to billing, our most recent bill was from duty on an import from September 2022. As they only show invoices for one year, I asked if they could email me all invoices for that time period for 6 months after. Of the 20 UPS email addresses I have had the misfortune to have accumulated over the past few years and all CC’d in, not one was able to provide that information.
DHL have provided a much better service at a better price and although the US companies we buy from don’t want to deal with them, as long as I fill in all the import paperwork, they are happy to hand over the package.