Logistics involves all activities related to movement of goods from the Manufacturer to the End consumer through a chain of channel partners. Logistics plays an important role in any economy. The growth prospects of the sector are closely linked to the economic growth. The sector encompasses Transportation, Warehousing and Packaging Industries.Logistics cost by value accounts for around 13% of the GDP of India, which is much higher than that in the US (9%), Europe (10%) and Japan (11%). In particular, the percentage-wise share of transport cost (an important constituent of total logistic cost incurred by a nation) by value of GDP has been steadily increasing. The annual logistics cost in India is valued at Rs. 6,750 billion (US$ 135 billion) and it is growing at 8-10% annually. (Source: CII & KPMG – Skill gap Study report)
The logistics sector as such faces a severe man power shortage.
The demand for human resource in the Transportation, Logistics, and Warehousing sector is thus expected to increase from about 7.3 million to about 25 million, leading to an incremental human resource requirement for about 17.7 million persons in the next 15 years. (Source: NSDC Skill gap analysis – report).
The Transportation, Logistics, Warehousing and Packaging Sector in India is dominated by the unorganized segment (small truck owning companies linked to intermediate brokers or transport companies, small warehouse operators, custom brokers, freight forwarders, etc.); the organized segment accounts for less than 10% of the total logistics market in India.
At present, the Major employers, who could afford to have their own training school recruit the candidates and train them according to their requirements. The other small employers and unorganized sector provide on job training, at the cost of decreased efficiency and loss of productive time.
Man power shortage in trucking Industry alone is estimated to be around 5 million drivers in the next 15 years.
It is estimated that there are around 0.3 million loading supervisors in the industry currently, and this number could go up to around 0.5 million by 2015. This would mean developing around ten thousand new loading supervisors each year till 2015. Even if we assume that the sector can provide 50 percent of this manpower internally, there still remains a critical requirement to train around 5000 loading supervisors every year till 2015.