Joseline Ndayikengurukiye
SCM 300
Professor White
December 1, 2022
Has the Supply Chain Recovered Since the End of the Pandemic
COVID-19, along with the millions of lives that it took, greatly impacted the economy of
not just the United States, but that of many other countries around the world as well. It has been
three years since the first outbreak occurred in Wuhan, China and we are now at the end of the
year 2022, but the supply chain still seems to be struggling. As a result of the pandemic, there
was a spike in job openings as companies were looking to hire more people. The pandemic also
caused a huge increase in consumer demand which in turn brought on a mass shortage of
inventory.
To start off, the pandemic was the cause of the surge of millions of job openings.
According to the article “Why the Pandemic Has Disrupted Supply Chains” by Susan Helper and
Evan Soltas, “Some businesses” reported being “unable to hire quickly enough to keep pace with
their rising need for workers, leading to an all-time record 8.3 million job openings in April.”
Millions of people were afraid of going outside for fear of contracting the virus. In return,
thousands of companies had to temporarily shut down their facilities while others were forced to
close their doors indefinitely because they couldn’t afford to go a long period of time without
running their businesses. Those that were able to keep their doors open had to do so with many
rules, regulations, and restrictions in place to prevent further spread of the virus. Since many
people were contracting the virus, the companies that were open had to find others to replace
them just as fast. If companies couldn’t find replacements fast enough, they wouldn’t have
enough manpower to push out enough products to supply their buyers.
Secondly, the pandemic was also the source of the dramatic increase in consumer
demand. As demand increased, businesses were having a harder time meeting those demands
because they also were running out of inventory. According to the article “The Supply Chain
Crisis: What’s Behind It & What to Do About It” by Sergio Galeano and Curran McSwiggan,
“The pandemic initially restricted business and consumer activity, leading to layoffs,
unprecedented levels of resignations, and a decrease in production and transportation. It was
followed by a quick rebound in demand when many production decisions had already been
made. This led to large-scale shortages and unmet labor demand.” Suppliers were struggling to
keep up with the fast moving changes happening to the economy. There were both short-term
and long-term issues for the trucking and freight sector, including a lack of 80,000 drivers. Rail,
maritime shipping, and aviation freight were all impacted, as well as the larger, interconnected
network of freight transportation. Due to a lack of shipping containers and chassis, the price of
the steel boxes increased by more than seven times along major shipping routes. Manufacturers
and producers still struggled to meet client demand with the lack of employees. Families were
spending more time at home and more money on buying goods rather than services, piling on
additional demands and further straining the supply chain. Safety net measures like stimulus
programs were also unintentionally increasing demand in the consumer market that was already
prone to volatility. Increased costs for intermediate goods resulted in American manufacturers
frequently having to raise the prices they paid other companies and consumers, or else they were
forced to cut back on production, close plants, and lay off employees, further causing shortages.
In conclusion, there was a point when businesses were able to adapt to the changes
brought on by the pandemic. Unfortunately, as the emergency state was prolonged, businesses
were finding it harder and harder to meet consumer demand as their inventory grew increasingly
smaller. Even now, prices are still high because there is still some difficulty in transporting
products to where they need to be and to those who need them. Auto prices are still high because
there is still a shortage of chips needed for the car to run. Gas prices are also at an all time high
because during the pandemic, the demand for gas was at an all time low which resulted in
decreased oil production. Now that the world is back up and running, the demand for oil
production has gotten increasingly high and oil producers are scrambling to keep up with the
demand. All in all, the supply chain took a huge hit when the pandemic hit but has made a
substantial amount of recovery for the past two years. Many other disruptions like the Omicron
variant and the Russian attack on Ukraine also caused uncertainty and destabilization to the
supply chain market. That does not mean that the supply chain has completely recovered from
the blows the pandemic landed, but it is well on its way to recovery as we see prices fluctuating
from what they are now to what they used to be before the virus broke out.
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