New Supply Chain Problems Add Insult to Injury for Warehouses in 2022

As if the massive supply chain crisis of 2021 wasn’t enough, businesses are jumping even more hurdles to provide products to customers in 2022. Consumers are finding store shelves bare yet again and businesses are scrambling to provide inventory to fill those shelves. Manufacturers, warehouses, and retailers alike are finding that new problems are proving extremely challenging. 

The Challenges

The labor force is needed to move products. Unfortunately, many key factors are causing worker shortages worldwide, leaving a large employment gap in the service, retail, shipping, manufacturing, warehouse, and distribution industries. To begin, COVID shutdowns in 2020 led to millions of people being unemployed and, in many cases, they did not return to their previous jobs when health restrictions were lifted. “The warehouses and distribution centers, those staff were laid off,” said Port of New York and New Jersey deputy Bethann Rooney in a recent Cheddar News article. “They went on unemployment and it’s been very slow to get them back into the workplace,” she added. 

Now, the Omicron variant has swept the globe resulting in massive sick-outs. Companies have been left with no choice but to use skeleton crews with overtime and/or cut hours. In addition, the Great Resignation is impacting warehouses and other industries as many workers leave their current employers to pursue different career paths. In an article from The Seattle Times, owner Stewart Leonard Jr. of northeast United States supermarket chain Stew Leonard’s stated, “Everyone is hit with a shortage of labor...Some because of the Great Resignation, but a lot of it is the Omicron surge.” 

Shipping Problems 

As mentioned above, labor shortages in the shipping industry led to fewer trucks on the road moving products. Transportation leaders are working diligently to increase the number of truck drivers to pre-COVID numbers. The American Truck Driver Association estimates it will have to replace one million truck drivers over the next decade, according to their 2021 Driver Shortage Update. The forecast is based on trends in driver demographics that cover gender and age, as well as expected freight growth.  

Let us not forget about Mother Nature. From tornadoes and torrential rains to ice and snow, 2022 has witnessed record-breaking storms and floods crippling many regions of the country. Winter months are typically challenging, however, the higher frequency and increasing magnitude of these weather patterns are being seen from coast to coast, causing many shipping delays. 

Continuing Supply Chain Backlogs 

While there continues to be a backlog at U.S. ports, supply chain problems aren’t just about full shipping containers sitting on the docks or waiting in line at sea to be unloaded. Manufacturers are playing catch-up to fill previous orders and production has slowed yet again on goods imported into the United States. In fact, China and the United Kingdom are two countries in which some cities have shut down factories again due to spikes in COVID transmission. Add to this the Chinese New Year company holiday, bottlenecks are bound to remain high. 

If you seek information on how to relieve some warehouse management stress during these already trying times, check out 3PL WMS software from Argos for more information. 

Frequently Asked Questions

How long are current supply chain disruptions expected to last?

Supply chain disruptions are likely to persist throughout 2022 and potentially into 2023. The timeline depends on resolving labor shortages, particularly replacing the estimated one million truck drivers needed over the next decade. Additionally, ongoing COVID variants, weather patterns, and international manufacturing shutdowns continue to create unpredictable delays that make recovery timelines difficult to forecast.

What specific industries are most affected by warehouse labor shortages?

Warehouse labor shortages are most severely impacting service, retail, shipping, manufacturing, and distribution industries. Port operations, trucking companies, and fulfillment centers are experiencing the greatest staffing gaps. Supermarkets and retail chains are also struggling significantly, as many workers who were laid off during 2020 COVID shutdowns never returned to their previous warehouse and distribution roles.

How are extreme weather events specifically impacting supply chains in 2022?

Record-breaking storms, floods, tornadoes, and winter weather are causing widespread shipping delays across the country. These extreme weather events are occurring with higher frequency and greater magnitude than typical seasonal patterns. The disruptions affect trucking routes, warehouse operations, and port activities, creating additional bottlenecks on top of existing labor and COVID-related challenges.

Which countries are causing the biggest international supply chain bottlenecks?

China and the United Kingdom are creating significant supply chain bottlenecks due to COVID-related factory shutdowns. China’s impact is particularly severe because of both pandemic closures and the Chinese New Year holiday period, which temporarily halts production. These international manufacturing disruptions slow the production of goods imported into the United States, adding to existing port backlogs and shipping delays.

What role does the Great Resignation play in current warehouse staffing issues?

The Great Resignation is significantly contributing to warehouse staffing shortages as workers leave their current employers to pursue different career paths. This trend, combined with COVID-related sick-outs from the Omicron variant, has forced many companies to operate with skeleton crews working overtime or reduced hours. The resignation trend affects warehouses alongside other industries experiencing widespread labor departures.