KC SmartPort, an affiliate of the Kansas City Area Development Council, recently shared global trends and Kansas City market insight on supply chain disruptions at its annual industry briefing this week.
The value of global trade reached a record level of $28.5 trillion in 2021, a 25% increase compared to 2020 and 13% higher than in 2019, resulting in an increased demand for industrial space across the country. As one of the nation’s largest hubs for warehousing, distribution and manufacturing operations, Kansas City is experiencing rapid growth as a centralized inland logistics port.
“Global shipping disruptions just prior to, and since, the onset of COVID-19 have exposed America’s need for a more agile, modern and efficient supply chain,” said Eugene Seroka, executive director of the Port of Los Angeles. “The development of interconnected ‘port community systems’ at major U.S. ports could help trade-dependent American businesses and their service providers more effectively plan, track and adjust their cargo flows. Moreover, digitalization of our national supply chain can produce higher levels of certainty, reliability and success for American companies engaged in global trade.”
In 2021, the Kansas City region surpassed an industrial footprint of more than 300 million square feet, joining only 15 other U.S. markets. In addition, Kansas City has nearly 13 million square feet of new industrial space under construction as of Q1 2022, a record for the market.
“As we continue to see record demand for industrial space, the Kansas City region has the infrastructure, location and workforce to quickly respond to this increased need to optimize global supply chains,” said Chris Gutierrez, president of KC SmartPort. “Located in the geographic center of the U.S., the KC region is perfectly positioned in the nation’s heartland as a centralized inland logistics port and offers a robust and talented workforce.”
The KC region has more than 200,000 workers in manufacturing, transportation and warehousing industries and offers a highly productive workforce with manufacturing employees in Kansas City providing 14.5% higher productivity than the national average, as measured by JobsEQ in 2020 for output per worker.
“Supply chain risk management continues to be top of mind for manufacturers and distributors across the U.S. and globally. Many companies are seeking ways to minimize this risk including investing in more domestic and regional serving operations as well as diversifying supplier networks and modes of transport. In addition, workforce shortages are adding an additional layer of complexity and concern for industrial employers as well,” said Michelle Comerford, project director and industrial & supply chain practice leader at Biggins Lacy Shapiro & Co. “Looking ahead, companies will continue to seek locations with strong logistics infrastructure to move goods in and out, that also possess high quality workforce and a concerted effort to grow the pipeline of those workers. Kansas City with its central location, strong logistics infrastructure, industrial operations culture, and top notch workforce development initiatives, is poised to be very attractive to much of this new investment.”
In the last five years, the Kansas City region attracted more than 8,000 jobs and $2.1 billion capital investment totaling 18.4 million square feet with companies including Niagara Bottling, Walgreens, ALPLA, Walmart, Urban Outfitters, Chewy, Melaleuca, Amazon Air, among others.