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How Companies are Dealing with Supply Chain Issues in 2022

By   /  February 4, 2022  /  Comments Off on How Companies are Dealing with Supply Chain Issues in 2022

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How Companies are Dealing with Supply Chain Issues in 2022

Much like in 2021, the shipping and freight industry continues to have logistic issues. The current labor shortage is limiting economic growth and causing shortages of goods and products around the world. The shipping industry reached record-high hiring levels during November of 2021 to alleviate some of the issues. But with no end in sight to the current shipping problems, recruiting, training, and hiring new workers in the shipping industry is set to continue through 2022.
Supply Chain Issues and Worker Shortages in 2022
The United States supply chain has struggled to keep up with demand during the current economic crisis. According to the White House, over 1800 jobs were disrupted in Southern California’s ports. This port is the entry point for almost 40% of all containers in the United States. Shipping corporations, like UPS and FedEx, depend on this port for their operations to run smoothly. The ports have switched to 24/7 operation to alleviate some of the stress, and the International Longshore and Warehouse Union have agreed to work the extended shifts. Companies like Walmart, Samsung, and others also expect to expand hiring for shipping and logistics jobs into 2022, as well.
The United States is also experiencing a trucker shortage. The American Trucking Association estimates an 80,000 driver shortage as of 2021. They also predict the number could reach 160,000 by 2030. According to the Employment Development Department of California, jobs for heavy truck drivers are expected to increase by 15.2% by 2028. While the job has adequate pay and compensation, the career has a rough and demanding lifestyle which deters many potential truckers from this position.
How are Companies Meeting Their Customer Needs
One solution that many companies are turning to is using overnight courier services. These companies offer fast shipping services that skip most of the supply chain. Small businesses that need to ship their products but are struggling to deal with the current logistical problems can use overnight shipping as a solution. An overnight courier picks up your items at the designated location and safely delivers them to their destination. Overnight courier services can be a it more expensive, but at the end of the day, they’re worth the investment.
Other companies have sought to diversify their supply chain and reduce dependence on a single production facility. Due to the current US-China trade war and supply chain problems, many firms have shifted to a “China plus one” production strategy. They notably reduce the issues during these current hard times by moving the production of vital goods to regional facilities. Along with this strategy, upgrades to shipping infrastructure can alleviate more problems in the supply chain. Finally, we see many firms innovating their supply chains through direct shipping and automation.
Still, the shortage of labor continues to be a primary factor causing many of the problems with our current worldwide supply chains. Because of the lack of truckers and longshoremen, businesses need more employees to deal with the ongoing supply chain issues.
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