This article was written by Kimberly Rossetti, vice president of economic development at Northern Kentucky Tri-ED.
The growth of Northern Kentucky’s transportation and logistics industry (T&L) is obvious to anyone who even casually follows the news or has driven down I-75 in the past few years. DHL opened its North American superhub at the Cincinnati/Northern Kentucky International Airport (CVG) nearly 10 years ago. Amazon rapidly built out its $1.5 billion Air Hub at CVG with operations launching in August 2021. Huge warehouses line the I-75 corridor with more in the works. Between 2015 and 2020, the T&L industry cluster created more than 11,000 jobs – making our region home to more than three times as many T&L jobs relative to the U.S. average. These new jobs helped Northern Kentucky lead the commonwealth in job creation from 2015 – 2020.
This industry is intimately connected to a sector that holds great promise for Northern Kentucky’s economy: Supply Chain Management & Support Services. This sector has been identified – along with Advanced Manufacturing, Life Sciences and Information Technology – for future economic development efforts by the region’s public, private and government leaders.
To understand how they intersect, think of T&L as the physical movement of goods from the manufacturer to the consumer and Supply Chain Management as the support system that facilitates that movement. T&L is about fulfillment centers and warehouses, trucks and trains. Supply Chain Management is about efficiency and resilience, technology and expertise.
It is these high-value functions – and the job potential they represent – that makes the sector so attractive. As does the right to win, given the centrality of T&L to our region and the continued growth of e-commerce. It is hardly surprising that Supply Chain Management companies tend to concentrate around major port and air cargo facilities.
While perhaps not as visible as the growth in T&L, the Supply Chain Management sector in Northern Kentucky is thriving. And varied. Companies within this sector range from MROs (airplane maintenance, repair and operations) to 3PLs (third-party logistics) and companies building AI robotic-enabled material handling systems. Here is a look at some of our region’s growing companies in the supply chain sector.
MegaCorp Logistics, a transportation logistics firm specializing in full and less-than-truckload shipments throughout North America, recently signed a long-term lease at the Ovation mixed-use development in Newport. The company will occupy two floors, or 40%, of the first Ovation office building. MegaCorp was named as a top logistics company and freight brokerage firm in the U.S. by Transport Topics, a highly-regarded industry news outlet.
Verst Group Logistics, the region’s second-largest logistics company, recently opened a new facility in Hebron and hired 250 people. The family-owned company employs 2,200 and provides everything from contract packaging and shrink sleeve labeling to transportation management and freight brokerage.
UPS Supply Chain Solutions is the logistics arm of this well-known delivery company. It offers freight consolidation, cargo insurance and financial services, industrial 3D printing and customs brokerage. UPS Supply Chain Solutions has a facility in Hebron.
Advanced Handling Systems (AHS), a Hy-Tek Material Handling company, is a full-service integrator of automated fulfillment and distribution solutions for 3PL, ecommerce, retail, wholesale, food and beverage, and healthcare companies. Headquartered in Erlanger, operations include assessment, research and development, engineering, field services, and ongoing customer support. Hy-Tek has a facility in Boone County and provides customized industrial equipment, automation and warehouse solutions for material handling applications.
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services to express and e-commerce delivery providers, the U.S. military, leading international airline, freight forwarders and charter customers. It recently moved its operations center from Florence to Erlanger, a $34.1 million investment that will add hundreds of jobs.
Total Quality Logistics is one of the largest freight brokerage and third-party logistics firms in North America. TQL is growing its regional presence with an expansion of its Boone County facility.
Lighthouse Transportation Services LLC is a third-party logistics firm. It has outgrown its space in Kenton County and will move to a larger facility in Covington and add more than 60 well-paying jobs.
F&E Aircraft Maintenance LLC (FEAM) provides aircraft maintenance and engineering services. It will locate a new three-bay hanger at CVG, a $40.2 million investment that will add nearly 250 full-time positions.
Transplace, a supply chain technology and lean consulting practice, acquired locally-founded LeanCor in 2020 with the goal of strengthening logistics performance with technology, domain expertise and scale. Through the acquisition of LeanCor, Transplace is a strategic supply chain partner that provides managed transportation services, supply chain consulting and corporate training programs to manufacturing-centric shippers.
As is the case with T&L, there is every indication the Supply Chain Management sector holds huge growth potential for our region. While online shopping has steadily increased during the past decade, e-commerce activity sharply accelerated at the onset of the pandemic. Yet more than 85% of all retail sales still occur at physical locations. Retailers see this untapped market and are aggressively building out their fulfillment activities, meaning they’ll need more and better Supply Chain Management support.
Northern Kentucky is perfectly placed to take advantage of the growth. We are already a logistics and distribution juggernaut, with cargo volumes at CVG having tripled during the past decade to become the fifth busiest cargo airport in the continental United States. The region benefits from significant water and land infrastructure assets and being served by three interstates. The Ports of Cincinnati and Northern Kentucky are among the busiest inland port districts in the nation.
All of this growth – and potential – is driving the need for more employees. While Supply Chain Management doesn’t face a rapidly aging workforce like other industries, securing talent has proven to be difficult. The pandemic has made recruiting and attracting workers even harder. The T&L sector is increasingly looking to automation to address labor needs; Amazon, for example, utilizes approximately 350,000 robots in its existing fulfillment centers globally. Automation, though, isn’t feasible for Supply Chain Management due to the higher skill nature of the work.
To help fill the employment pipeline, 10 regional colleges, universities and career campuses offer various related degrees and certificates. Northern Kentucky University now offers a Bachelor of Science in Global Supply Chain Management to provide students insight into strategic sourcing and global management of inventory as well as practical knowledge of distribution, transportation and logistics strategies. Gateway Community & Technical College offers training in the global supply chain for supply chain specialists, global sales associates and logistics managers. Supply Chain OKI is nonprofit organization that helps youth and the unemployed find job opportunities and the education to create the next generation of supply chain employees in Ohio, Kentucky and Indiana.
So the next time you get a package delivered right to your door, remember that an entire industry is at work to make it happen.
To learn more about Tri-ED, visit www.NorthernKentuckyUSA.com or follow these accounts on social media: @NKY_EconDev (Twitter), Northern Kentucky Tri-ED on LinkedIn and Facebook.
