Supply chain disruptions have affected virtually all industries, here in the U.S. and around the world, over the last year or more. Product inventories and entire industries, such as travel and hospitality, shrank significantly due to low demand caused by the pandemic throughout 2020.
When lock downs and travel restrictions eased and vaccinations became available, demand for products and services accelerated more quickly than anticipated. The supply chain has yet to catch up and was dealt another blow by the highly contagious Omicron variant causing high absentee rates among workers across industries worldwide.
A Wide-Ranging Problem
The global supply chain for goods and services is actually multiple supply chains containing many links, any one of which can fail and disrupt the flow of business for a host of industries. A report from the White House last summer indicated that all major business sectors reported some level of supply chain disruption.1
This is largely because so many industries are interdependent for wholesale parts, raw materials, packaging, shipping, etc. And every component within each supply chain is in some way dependent on labor, which has been in unexpectedly short supply.
The COVID-19 pandemic caused job losses in a number of ways. Early on government-enforced shutdowns made it difficult to impossible for some business to operate, while also causing a huge decrease in demand for some products and services. Other businesses were compelled to cease or reduce operations due to worker safety concerns. Millions of workers lost their jobs directly and others were forced to resign in order to look after their children, care for elderly or disabled relatives, or because they feared exposure to the virus.