President Biden is expected to announce today that the Port of Los Angeles will soon operate around the clock as part of an effort to relieve supply chain slowdowns, reports The New York Times.
This news comes as product shortages are contributing to rising prices, and the problems are poised to get worse, extending into next year and beyond, and disrupting shipments of necessities.
Biden and his supply chain task force are working to unblock the flow of goods and help retailers return to a pre-pandemic normal. Today, the White House will host leaders from the Port of Los Angeles, the Port of Long Beach, and the International Longshore and Warehouse Union to discuss the situations at ports, as well as hold a roundtable discussion with executives from Walmart, UPS, and Home Depot. Full Story
The labor shortage is compounding the industry's problems. Last week’s jobs report from the Bureau of Labor Statistics is the latest evidence of a severe labor shortage that is sending the consumer packaged goods supply chain into chaos, according to the Consumer Brands Association, which noted that the CPG industry added 5,000 jobs in September, far below what it needs to be to keep pace with accelerating demand.
“As the COVID-19 pandemic has worn on and supply chain pressures have intensified, we've run out of slack in the system,” said Geoff Freeman, president and CEO of Consumer Brands, in a statement, Friday. “The labor shortage is driving the majority of issues in the supply chain and the paltry additions today — for CPG companies and industries they rely on — create an untenable situation for manufacturers.”
Consumer demand for CPG products increased by 9.4 percent in August and continues to build, according to Consumer Brands. It said that the CPG industry has 143,000 unfilled jobs, with 889,000 open roles in broader manufacturing. Despite a variety of worker incentive programs, ranging from raising wages by 7.3 percent for facility workers on average to helping pay for college, it still lacks workers to fill critical positions.
“The imbalance of jobs added versus jobs open is driving up costs and threatening product availability,” Freeman said. “As we head into the busy holiday season, we need to find ways to grow the workforce to keep shelves stocked with essential goods.”
Compounding challenges for the CPG industry, the trucking industry added only 2,500 jobs, a number far short of what is needed to move goods, according to Consumer Brands. The backlogs at U.S. ports are being further strained by a lack of trucks available to take containers to their next destination. Shipping and logistics company CH Robinson's CEO Robert Biesterfeld estimates that the ratio of shipments to available trucks is as high as 16 to one.
Consumer Brands is calling for government leaders to do more to address the labor shortage, including enhancing childcare and family support programs and launching new workforce initiatives to advance education, apprenticeships, and support of skilled trades and supply chain professions greatly in need of new talent.
“We need to see more urgency from policymakers to grow the labor pool. The current shortage is the biggest obstacle to our country’s economic health,” Freeman concluded.
Related: Target to Increase Holiday Pay; Publix to Hire 30,000 Employees.