UPS set to increase seasonal staffing numbers to meet holiday delivery demand

Freight transportation and logistics bellwether UPS is gearing up for the holiday delivery surge in more ways than one.

The Atlanta-based company said that it plans to hire between 90,000-to-95,000 seasonal employees, up from about 85,000 last year, to support “the anticipated holiday surge” for package deliveries commencing in October and running through January. 

These seasonal staffers will be crucial for UPS to handle its expected increase in package deliveries, with the company prepping to aid retail shippers be fully equipped to meet their customers’ needs during the holiday season. Positions they will occupy include package sorters, loaders, delivery helpers, and drivers.

“We have initial volume forecasts from our customers and are starting the hiring process for our temporary peak season jobs,” said John McDevitt, UPS senior vice president of human resources and labor relations, in a statement. “We have needs throughout the United States and anticipate more applicants this year than in 2013. Individuals who begin employment at UPS during the holiday season have the opportunity to pursue a permanent position afterwards. Seasonal positions provide an excellent entry point for becoming a long-term UPS employee.”

This announcement comes after a difficult 2013 holiday shipping season during which many supply chain networks, not just UPS’s, dealt with myriad delays and service disruptions during Peak Season in 2013, and are not determined to go down that road again in 2014. And while there were delays and some people did not get their items in time for the holidays, industry estimates suggest it was a relatively modest amount of volume that got lost in the shuffle.

As previously reported by LM, UPS said on its second quarter earnings call this summer that it plans to up the ante for 2014 operating expense for capacity and peak-related projects to $175 million, with some of this capital allocated for things like expanded operations on the day after Thanksgiving, accelerated deployment of route optimization software (ORION), IT development, additional hub sorts and temporary capacity.

“One frequent topic of discussion has been our preparation for peak season. We’ve had meaningful conversations with customers about our plans,” said UPS COO and CEO-elect David Abney on the company’s earnings call. “These discussions provide the foundation for a joint commitment of forecast volume enabling UPS to better manage how large accounts impact our network. We have made changes to UPS technology that will improve communication with customers. Solutions have been implemented to provide better information on package location and shipment status, ultimately benefitting customers and UPS.”

UPS Director of Public Relations Susan Rosenberg told LM that UPS began talks with customers about holiday deliveries much earlier than usual this year.

“We are having really meaningful discussions with particularly larger, high-end shippers,” she said. “In some cases are making changes; they may be putting new distribution centers in certain locations. There is also the whole growth of omnichannel, with the combined brick and mortar and shopping component in which retailers are using their stores as fulfillment centers. This means our patterns for pick up and delivery are changing. We are having that dialogue and have been building capacity that might be permanent with brand new buildings that are going up very quickly.”

One of these new buildings, she said, opened up in Laredo, Texas and two new buildings set to open in the Dallas-Fort Worth Metroplex that will be open in time for the holiday delivery season, as well as a new building in Meniffe, California, the Inland Empire in southern California.

UPS has also added increased automation capabilities in its hubs, with more overhead doors, loading equipment and conveyor systems, as well as what it calls “next generation small sort,” which expands a lot of the lightweight packages that are common within e-commerce deliveries, according to Rosenberg.

“We are going to be processing things in a number of ways that simplify the job for sorters using the related technology,” she explained. “All of that is going on throughout the country, and then we will be adding more sorts at buildings and we are staffing up for those.”

The concept of flexible capacity is also key for UPS either by adding more sortation capabilities or conveyors along with modular mobile delivery villages, which can be added onto existing buildings or serve as a pop-up delivery center for adjacent properties or those in close proximity. Rosenberg said this allows UPS to put more ground trucks on doors that help to load in and load out process with those vehicles, which, in turn, increases temporary capacity. All of these functions are adding people to match the increase in temporary capacity, which is what UPS needs for this temporary period, she explained.

In building expectations for volume projections by its customers, Rosenberg said it is more than just raw numbers. Instead, she stated that it has to do with where packages will be inducted into the UPS system and also its customers managing expectations for their respective customers.

Also working in the company’s favor is the addition of two full operating days for this year’s holiday season, with one due to the calendar setup and another due to working a full day on Black Friday, which historically has only been open for business for air and international deliveries by UPS. This will subsequently position buyers more strategically for Cyber Week, which will level out, and also have the additional processing sorts for the month of December.