Leaders within the warehousing business sector are feeling more confident about labor supplies heading into 2023, according to a report by Instawork. 51% of participants that took part in Instawork’s recently released “State of Warehouse Labor Report” said it will be easier to find workers in 2023 compared to 2022.

The survey, released April 11, reported that participants feel they have gotten better at employee retention. In 2022, 76% of responders said they had effective employee retention strategies. That number jumped to 85% in 2023. Additionally, the number of business leaders that believe they have an effective recruitment strategy increased from 59% in 2022 to 76% in 2023.

The report said increased pay and flexible scheduling were the top two recruitment and retention tools for 2023, but that business leaders are more inclined to offer flexible scheduling than pay increases.

Last year, 72% of businesses considered pay increases to be the most effective tool for improving employee retention. However, that number fell to 64% this year.

Simultaneously, respondants have taken a more favorable stance toward flexible scheduling. In 2022, 44% of companies that participated in the survey said flexible scheduling was one of the most effective tools available to improve employee retention. This year, that number jumped to 53%

Due to the COVID-19 pandemic, 34% of those surveyed in 2022 said they had to forgo business due to a lack of labor, according to the report. Amongst those that had to make revenue sacrifices, 64% said they had to forgo revenue amounting to more than 25% of the company’s total business. In the report, that drastic shift was described as “an important reason” why 45% of responders didn’t report an increase or decrease in fulfillment volume for the year.

Overall, the study predicts a return to normalcy for the light industrial sector. The report said that businesses in the industry “are looking forward to a more manageable year” despite dramatic changes to the sector because warehouses, third-party logistics providers, and distribution centers that embrace scheduling flexibility “are often seeing the best outcomes.”

“As the quantity, reliability, and skill of flexible workers increase, those using flexible labor will see even more success in staffing, and their ability to navigate an ever-evolving economic landscape,” the report concludes.