By now, you’ve probably noticed empty shelves or late delivery for everythingand To and smartphones. Even supermarkets, and school cafeterias are lacking in cargo.
A reason? A labor shortage along the, the short term for a series of steps that goods take from the farm and factory to store shelves or your doorstep. Simply put, there aren’t enough workers to process, move, sell, and deliver all cargo entering U.S. ports across the country fast enough. A nationwide shortage of truck drivers is also making it more difficult for goods to gain quick access to warehouses, which themselves are understaffed.
The result for consumers: It takes longer to get items to store shelves or to your doorstep. Much of the problem stems from the sudden change in the buying habits of Americans report titled “Dude, where are my things? “JPMorgan Chase’s Michael Cembalest said in a podcast accompanying a
As more and more people have started working from home, consumers, whose purchases represent about 70% of US economic activity – began to buy more goods than services. Add to that a and the supply chain is starting to warp, said Cembalest, chairman of the investment bank’s asset and wealth management division.
âCOVID has exacerbated some of the vulnerabilities in the US supply chain, just as global merchandise trade is booming and people want more things instead of services,â Cembalest said.
The shortages could continue until 2022 before easing, some economists predict.
Don’t wait to buy hot toys
About 90% of all goods are Shipped across the oceans. China is not only implementing partial closures at ports when a case of COVID-19 is discovered, it is also implementing power cuts due to an energy shortage as the country shuts down. strives to go green. Factories across Asia are shipping less goods.
Guangdong industrial center cuts power to factory through Industries as the Chinese public is urged to reduce the use of lighting and air conditioning, Mark Haefele, chief investment officer of UBS Global Wealth Management, said in a note to investors this week.
Some 85% of the 3 billion toys sold in the United States come from China, according to to the Toy Association. This means that if you want some of the best-selling toys during the holiday season, it is advisable to buy early and in person at small retailers, Marissa Silva, editor of Toy Insider magazine, told CBS MoneyWatch.
The toys should be in stock now, but some have arrived four to six weeks late. This includes articles on the magazine Hot 20 list, like the PokÃ©mon Trading Card Game: Celebrations Elite or the transforming Batman Bat-Tech Batcave. Some classic toys this year are selling for $ 2 and $ 3 more than last year due to higher supply chain costs, she said. Additionally, delivery delays may push back restocking orders past December 25.
“So if you look at some of these hot toys, you can’t wait until December 15th to buy them because there’s a good chance they’ll be on sale until January. We hope people can avoid that.” , said Silva.
Late US ports
Once cargo arrives in the United States, it can still reach great safeguards In Los Angeles, a record 70 freighters were waiting to enter ports in LA and Long Beach in mid-September. Together, the two ports handle around 40% of the country’s imported goods. In addition, the cost of shipping these goods has skyrocketed as containers fill up faster than in China, where most containers are located. made – could produce them. This caused further delays.
The average cost of leasing space on a container ship from Southeast Asia to the west coast of North America was approximately $ 10,800 at the end of Last week, nearly five times the price at the same time last year, according to an index from tracking company Freightos. The region’s shipments to the East Coast were almost double, at about $ 21,000.
Global traffic up 50% from pre-pandemic levels, Port of Los Angeles director says. âThe buying force of the American consumer is so strong and epic that we cannot absorb all of this cargo into the national supply chain,â he said. “This means you aren’t going to find the product you want as quickly as usual. If you are shopping for the holidays, start now.”
Truck driver shortage slows deliveries
Once unloaded at ports, cargo languishes for up to two weeks because there aren’t enough drivers to transport it, Oren Klachkin, chief US economist for Oxford Economics, said in a recent report. Before the pandemic, a typical wait was three to four days.
âThe trucking industry – which carries 75% of total freight across the country – is struggling to move record amounts of cargo,â he wrote.
In 2019, the United States was already short of about 60,000 truck drivers. That figure could reach more than 100,000 by 2023, wrote the chief economist of the American Trucking Association in a report This year.
Trucking equipment and engineering parts necessary for the current fleet on the road are also stranded on ships and in ports, Nick Najjar, Director of Transportation at Land O’Lakes, Recount CBS Chicago. âThere is the supply side; there are the drivers in the industry, train them and the trucks; then make the equipment act for the freight demand,â he said.
Warehouses, shippers looking for help
When goods arrive at a warehouse, there are fewer people than needed to sort and return the goods quickly enough to meet consumer demand. As the critical holiday season approaches, major retailers are trying to change that.
Amazon has announced plans to hire 125,000 US. Some at the online sales giant’s recruiting event on September 15. These jobs offer average starting wages of $ 18 an hour and up to $ 22.50 an hour in some locations.
Walmart, the country’s largest private employer,to fulfill online orders and operate elevators in over 250 Walmart and Sam’s Club warehouses and distribution centers. The average salary for supply chain associates is $ 20.37 an hour, according to the company.
At FedEx, more than 600,000 packages a day are rerouted due to understaffing, executives told investors in a recent conference call.
For example, at the company’s shipping center in Portland, Oregon, about 25% of packages are redirected because they “just can’t be processed efficiently to meet our service standards,” said Raj Subramaniam, chief operating officer of the company, to investors when calling.
FedEx wants to hire 90,000 new employees. UPS competitor is targeting 100,000 before the end of the year holidays.