Within the past year, COVID has disrupted the world’s supply chain by delaying shipments of raw materials and products, resulting in product shortages. In this article, we want to highlight three shortages that are ongoing and relevant.
The Shortage of Labor
When COVID hit, various industries such as the hospitality, travel, transportation, and entertainment industry suffered. At the beginning of the pandemic, the U.S. Bureau of Labor Statistics reported an unemployment rate of 14.7% as 23.1 million people were unemployed in April 2020. Now, as states have eased restrictions and reopened, people are eager to get out and travel. However, many industries are unable to hire fast enough. For example, American Airlines canceled hundreds of flights in July 2021 due to a labor shortage. A great number of other businesses have also reported that they cannot hire fast enough.
The Shortage of Lumber
Since COVID hit the United States, there has been a noticeable movement of Americans relocating from the city to the suburbs. According to Bloomberg, New York City suffered the greatest loss of renters and homeowners. About 20,000 people moved from Manhattan to Brooklyn and approximately 19,000 people moved to Florida. As a result, there’s been an increase in new housing and home improvement projects, which has increased the demand for lumber and lessened the supply. Due to COVID disruptions and restrictions, supply cannot meet demand, resulting in the shortage of lumber.
The Shortage of Semiconductor Chips
Semiconductor chips are found in cars, computers, gaming systems, and many more technologies. Due to earlier stay-at-home orders, demand for gaming consoles and computers increased so high that manufacturers cannot keep up. The combination of COVID disruptions, limited supply of raw materials, and social distancing restrictions in manufacturing facilities limit the supply of semiconductor chips.
Although we only highlighted three ongoing shortages, there are plenty more we did not cover. For example, Starbucks is currently having a green tea shortage. Until the supply chain returns to normal, and the manufacturing facilities start running at full production, shortages will keep emerging. To monitor and address any supply chain issues, the Administration established a Supply Chain Disruption Task Force. They are working to resolve any shortages and supply chain disruption issues to lead the U.S. into a more resilient future.
