3PLs Penske Logistics, Kenco Lay Off Combined 300
The broader job market within the transportation and warehousing industry is showing signs of improvement to kick off 2024, but that hasn’t stopped some companies from continuing to downsize.
On the heels of recent layoffs at UPS, GXO, Coyote Logistics, Flexe and Veho, two other logistics companies—Penske Logistics and Kenco—are severing ties with a combined 313 employees.
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Transportation and distribution services provider Penske Logistics is laying off 203 employees in Washington and Oregon, according to Worker Adjustment and Retraining Notification (WARN) Act notices filed in each state.
Third-party logistics (3PL) provider Kenco said in its own WARN notice that it would lay off 110 employees upon closing a warehouse in Indianapolis.
WARN notices are required under federal law for companies to provide employees with 60 days’ notice of a possible plant closure or mass layoff.
Penske will lay off 125 employees in Washington, and 78 in Oregon. For Penske, layoffs across both states are effective March 31. Kenco’s affected employees will be laid off on March 19.
According to the WARN notice, the 125 terminated employees in Washington are being laid off across four facilities in Auburn, Arlington, Benton City and Spokane. Washington State does not publicize WARN Act letters, so it is unclear how many of the 125 Penske employees work at each individual warehouse, or what job description they hold.
The 78 Penske personnel impacted in Oregon performed dedicated contract carriage and warehouse services for Republic National Distributing Company (RNDC), an alcohol distributor. Sixty-seven of those workers were based out of RNDC’s Portland facility, while the remaining 11 staffers were employed out of the company’s three smaller Oregon-based locations in Bend, Eugene and Medford.
Drivers comprise 36 of the 78 employees that will be laid off, while 26 are warehouse workers. The remaining staff serve a variety of roles, including operations supervisor and manager, inventory clerk and logistics planner.
According to both the WARN notice and a Penske spokesperson, RNDC is moving to in-source the work Penske currently performs, which includes warehousing and trucking services—ultimately resulting in the staff cuts.
“This upcoming transition was communicated to our employees well in advance of the state notification filing. Penske Logistics workers on this account will have the opportunity to apply for positions working with RNDC directly,” the spokesperson said. “We’re working with RNDC to help facilitate this process quickly, so workers will have the opportunity for continued employment with RNDC.”
The Reading, Pa.-based Penske Logistics has nearly 8,800 drivers and roughly 7,300 power vehicles, according to the Federal Motor Carrier Safety Administration’s SAFER website.
Sourcing Journal reached out to Kenco. The Chattanooga, Tenn.-based 3PL did not indicate why it is closing its Indianapolis facility.
Kenco’s staff cuts come just weeks after the company acquired Dallas warehousing company, The Shippers Group. The deal’s terms were not disclosed, but the company said the acquisition expands Kenco’s warehousing footprint by 3.8 million square feet. Shippers Group provides warehousing, co-packaging and fulfillment services out of eight facilities in Florida, Georgia and Texas.
Prior to the deal, Kenco says it managed over 100 distribution centers across North America, operating in 33 U.S. states with a combined 36 million square feet of warehouse space.
Both Penske Logistics and Kenco indicated within their WARN notices that there are no “bumping rights” for the affected associates. That means that the terminated employees are not able to displace junior-level associates out of their job positions as a result of the facility closings.
Jobs report gives logistics sector a boost
Despite the recently announced layoffs, wider logistics employment may have gotten a bump from a better-than-expected nationwide jobs report, in which the U.S. economy added 353,000 total jobs. The number far exceeds the initial expectations of 180,000 positions created.
The report, released Friday, saw the transportation and warehousing sector add 15,500 jobs in January, pumping the industry’s total count to a seasonally adjusted 6.56 million, according to the Labor Department’s Bureau of Labor Statistics (BLS).
Trucking had a small uptick of 2,400 jobs to start the year, reaching 1.56 million on a seasonally adjusted basis.
On a year-over-year basis, transportation and warehousing still employs 53,400 fewer workers than January 2023. Trucking takes up the lion’s share of this annual drop, with 31,300 fewer employees. The overall transportation and warehousing sector still remains well off peak levels in July 2022, when there were 6.66 million workers employed.
