Note: Today’s post is part of our ‘Editor’s Picks’ series where we highlight recent posts from our sponsors that provide supply chain insights and advice. This article is from Longbow and examines the current labor shortage and supply chain visibility.
Over the past 20-22 months, we have experienced global disruptions that have altered and influenced lifestyle changes. With the establishment of global policies inspired by COVID-19, the daily routines of industries globally have had to change the way they operate within the supply chain sector.
The Effects of Labor Shortages on the Supply Chain
As the pandemic continued and stay-at-home restrictions were established, many began to re-evaluate their careers and professional positions, which created an influx of people taking early retirement. With the current labor shortage, organizations are embarking on a massive hiring spree, but are facing challenges finding, hiring and retaining talent. Goldman Sachs researchers led by Jan Hatziusworf estimate that these trends will continue well into the year (2022) as nearly 60% of the working population will not return.
Some factors to consider are that able working age individuals become much more selective in the career path they are willing to consider/pursue. Many find alternative ways to earn income and establish financial stability and choose to stop working the traditional 9-5 altogether. These variables, coupled with competition from other industries like technology (remote posts have grown in popularity) or health care, manufacturing employment is down nearly 400,000 from pre-pandemic levels, creating the labor shortage in the supply chain that we have today.
Despite the labor shortage, consumers continue to consume
We have seen disruptions in the delivery of goods and merchandise around the world due to delays like the blockage of the Suez Canal, slowdowns in China and unloading in Los Angeles. With these disruptions and labor shortages, employers are finding that due to a lack of visibility, they struggle to effectively manage processes and offload imports, resulting in slow delivery times. and shipping delays that impact the entire supply chain. So organizations changed to meet the demands, which led them to redefine their strategies and reframe how to maximize their efficiency with their existing workforce, such as adding new processes like pay-for-performance. . However, not all organizations implemented new software, strategies or procedures to help increase visibility into their supply chains and deliveries, which contributed to a 6.2% increase in l ‘consumer price index.
Rising Real-Time Visibility – A Step Towards an Intelligent Enterprise
Although organizations have solutions to manage their inventory, labor, and warehouse operations, they continue to face challenges with speed, complexity, constraints, and declining availability of workforce, visibility and increased efficiencies. Other organizations are looking to automation and/or robotics as a solution, but these solutions are difficult to gauge the return on investment. There are great technologies available today that aid in manufacturing, but these solutions rarely consider inventory, labor, or storage constraints and are limited in their ability to integrate across all systems. involved.
To read the full article, click here.