Due to the global pandemic, supply chains all over the world have had to deal with disruption. Hundreds of manufacturers in the last year have been forced to shut down completely due to outbreaks and government orders to meet health and safety standards. Shutting down caused shortages in products from retail to the automotive industry and beyond. Now that the economy is beginning to reopen with Americans receiving vaccinations, demand is much higher than supply.
The issue creating the slow down is being seen in every step of the supply chain from creation of raw materials to transportation and delivery. According to a study by the Federal Reserve Bank of Cleveland, the delays in logistics stem from a shortage of truck drivers. From drivers getting sick and having to quarantine to trucks breaking down and unable to be repaired due to lack of supplies, this has all been uncharted territory that we were not prepared for.
Along with high demand comes price increases at every level as well.The lack of raw materials, drivers, and overall supplies causes inflation. The resolution to these supply chain issues is still in limbo. Reuters has reported that medical device makers and manufacturers have sent a letter to President Biden asking for U.S. lawmakers to provide federal funding for the recent shortage of semiconductors. Semiconductors are used for just about everything and lead times are as far as one year out right now, according to Harvard Business Review.
Manufacturers will need to continue to evolve as we move forward in this unprecedented time. The disruption caused will be seen for months to come, but the hope is to create protective measures from what we have learned in order to prevent the same thing occurring in the future.