By Janean Sorrell and Elizabeth Casillas, Oct. 26, 2021
The COVID-19 pandemic has generated a global labor scarcity causing an “everything shortage,” shortage of many goods ranging from computer chips to toilet paper. With the supply chain interrupted and clogs of container ships waiting at the Port of Long Beach and Port of Los Angeles, the Cal Poly Pomona community can expect to encounter these disruptions past the holiday season.
Given the state’s continued struggles with labor shortages, specifically a lack of truck drivers and port workers to move things off ports, the “everything shortage” poses a significant effect for the campus community, and local businesses and supply.
“I’ve seen a lot of bottled water run out recently. For an event, we had to get large jugs because the individual bottles were gone,” said Jeffrey Raymond, a mechanical engineering student. “I can’t get my yogurt at Albertson’s anymore, and eggs have been running short lately at the Target I shop at. Things come and go, items aren’t consistently stocked, so I have to go to several stores. That is kind of annoying.”
The supply chain’s increasingly global interconnectedness is the main reason behind the disruption. Wenge Zhu, professor in the Department of Operations and Technology, described the global manufacturing process of almost every product as a large assembly line.
Currently, very few products are made from beginning to end at one place or within one company; the supply chain is the process and steps it takes to bring a good to a consumer. Companies receive raw material from one source, labor from another and then the finished product is shipped to consumers around the world.
A slower output rate at one point can snowball into slower outputs for all companies in the chain expecting to receive a product; these are the conditions seen now. As Zhu put it, with COVID-19 and the labor shortage, “we have a perfect storm.”
The supply chain disruption is also affecting campus operations. With carbon dioxide supply being impacted across the U.S. due to plant maintenance and temporary shutdowns, northern California demand has exceeded supply and carbon dioxide has had to be shipped to companies needing that resource. Plants are starting to shut down in Southern California, and the southern part of the state will also feel its impact.
The BRIC pool uses carbon dioxide to regulate pool chemicals to create a safe place for swimmers to swim in. This composition will lower the potential of hydrogen, or pH, of the pool. The BRIC strives to keep the pool at a pH level of 7.4; during a previous stint in July without carbon dioxide the pool reached level of up 8.2; a level not recommended for swimmers and the pool was closed. A representative of Knorr Systems, the BRIC’s vendor for carbon dioxide, predicted no change in the disbursement of carbon dioxide at this time.
The Bronco Bookstore is another area of campus that finds itself impacted. In an email, Brian Alexander-Fetterman, assistant director of Bookstore Services, stated via email that the bookstore is struggling to obtain items typically easy to get, and is working hard to find substitutes.
“Nothing core is really missing but getting new items in is a challenge,” stated Alexander-Fetterman. “Students may find some brands they aren’t as familiar with or are new to them. Some of this is on purpose to make the shopping experience more interesting; some of this is due to needing to find substitutions.”
After months of restrictions and lockdowns, an increase in consumer demand is exacerbating shortages. Zhu explained how during the peak of the pandemic, the demand for consumable goods skyrocketed. During the first months of 2021, retail sales were up 14.5% in comparison to the same time period during 2020.
With a labor shortage across the world, and demand for goods spiking, inflation has also increased. The U.S. currently possesses its highest inflation rate in over a decade with a rate of 5.4%, a stark contrast with 2020’s 1.4%.
“We will see inflation that we probably, in the past few decades, have never seen before,” said Zhu. “It will be very tough. The pandemic is once in a lifetime for most of us, and again the consequences, what we see right now, it’s probably also a once in a lifetime experience.”
According to Carsten Lange, a professor in the Economics Department, just-in-time production is also to blame for the clogged ports. This system is designed to be tightly organized so the raw materials a company needs to produce arrive at the same time as production. This saves the company money on storage costs.
However, now the harbor is overwhelmed with goods due to labor shortages. As of Oct. 19, 157 container ships were waiting for workers to unload at the Port of Los Angeles and the Port of Long Beach; as of Oct. 20, that number was 64 cargo ships.
“The supply chain is broken,” said Lange. “It means that companies cannot deliver products either to the end customer or to somebody who needs to produce. That leads to delays and shortages of products.”
Zhu believes the best solution for these issues is for world leaders to come together and craft an equal solution at every stage of the supply chain. This would lead to an efficient restart of the assembly line on a global level.
Gov. Gavin Newsom issued an executive order Oct. 20 directing state agencies to locate state, federal and private land to store storage containers arriving on both the Port of Los Angeles and Port of Long Beach while freight routes for trucks are identified. This would also include temporarily exempting weight limits on some roads.
The executive order also called for California’s Labor and Workforce Development Agency to increase education and job training opportunities for port workers and truck drivers.
This follows the Biden administration’s announcement on Oct. 13 stating it would be keeping the Port of Los Angeles open 24 hours and seven days a week to attempt to minimize the logjam. He also announced private firms have committed to keep clearing the backlog, allowing for more workers to become involved.
The U.S. Labor Department and Agriculture Department has also started expediting the process for commercial licenses: the licenses needed for truckers to start working. In effect, this process would raise the amount of truck drivers in the field.
“The issue is, as you can imagine, that we have a drainage problem,” said Zhu. “We have a drainage problem, and once you identify we have a problem, you see it as a huge pool of water. Once you are able to fix the drainage, the pool water won’t disappear, it takes time.”
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