The changing nature of waste

Departments - Editor’s Letter

December 8, 2020

Like many of us, I’ve spent considerably more time at home over the last half-year-plus. Between working from home and cutting back on social engagements, I’ve begun to notice things I’ve never picked up on before.

One of the observations that has gotten my attention is the frequency in which Amazon, FedEx and UPS drivers navigate through my neighborhood. Every couple of hours, one of these clearly demarcated trucks or vans cruises down my street, with the driver stopping every few houses to drop off a package or two.

While I chalked up noticing the frequency of these trucks passing by to simply spending more time at home, data suggests that is not entirely the case.

Recent data from IBM’s U.S. Retail Index, as reported by Yahoo! Money, suggests that the pandemic has expedited the shift from in-person retail shopping to e-commerce by roughly 5 years. This manifested itself in department stores and other non-essential retailers seeing a decline in revenue of 25 percent in the first quarter and a whopping 75 percent in the second quarter. In all, the report estimates that department store revenues will decline 60 percent for the full year as e-commerce grows by close to 20 percent.

The waste industry has seen this shift firsthand as commercial volumes have decreased in many markets while residential volumes have escalated. And although these changes could be linked to a temporary imbalance caused by COVID, some economists and waste industry leaders are projecting some permanent changes to how we shop, where we work and where we’re producing our waste.

With shopping malls and mom-and-pop retail locations alike closing or facing an upswing in vacancies due to economic hardships both related and unrelated to COVID, haulers are being forced to rethink their operations.

Waste Management CEO Jim Fish recently spoke with Yahoo! about the impact of the COVID crisis on the waste industry.

Specific to the shift to e-commerce, Fish said that the company is being forced to reevaluate what both people and businesses are recycling, “The impact on our business is cardboard in our recycle stream. It’s coming from a different place. Instead of coming from a Sears store, which we might have picked up before, now it’s coming in small quantities from residential customers as opposed to big commercial customers.”

Fish went on to say that cardboard volumes have increased in the residential stream by about 15 to 20 percent over the past few years, which has only been exacerbated by COVID. This coincides with an increase in residential bottle and can recycling. Still, he noted that overall recycling volumes are down about 4 to 5 percent on the year when combining both commercial and residential volumes.

As the long-term implications of these shifting trends begin to be realized in the coming months and years, everything from how haulers think about their collection operations to how they set pricing is sure to change along with it.

To see what waste operators are saying about where the industry is trending, read “Where are we with waste?”