Supply chains: 'Complete container misalignment' is clearly hindering US economy

Mon, Oct 11, 2021, 8:23 AM 2 min read

The supply chain crisis is likely to hit holiday season given the immense backlog that's still unresolved, one expert said, and the current state of the labor market isn't helping.

Supply chains have been bogged down for weeks with bottlenecks in shipping and labor shortages in trucking, causing massive delays in moving goods across borders. Many experts expressed concerns that the delays could lead also to elevated inflation.

"Let's look at the math: It's 14 days to get a container from APAC to the U.S. and 40 days for it to get back," Coresight Research Founder & CEO Deborah Weinswig explained on Yahoo Finance Live (video above). "And we have a complete container misalignment right now. So that's 80 days, we're talking, in our opinion — we're probably looking at Q1 2023 before all of those containers get back and realign."

A cargo ship arrives into New York Harbor on October 6, 2021 in New York City. Global supply chain disruptions have continued to affect the U.S. economy. (Photo by Spencer Platt/Getty Images) · Spencer Platt via Getty Images

The labor shortage is also playing a major role in compounding shipping delays.

While the September jobs report noted "notable job gains" for the month, with employment in transportation and warehousing increasing by 47,000 and employment in retail trade rising by 56,000.

Those numbers didn't explain the full picture, according to Weinswig.

"If you think about what we're seeing in supply chain, that's where we really need to see stronger numbers," she said. "With about a 400% turnover rate in [distribution centers] and warehouses, we've got some... real concerns."

All that said, Weinswig sees opportunities arising out of the current supply chain crisis, especially when it comes to how e-commerce will help businesses survive and thrive going forward.

“This is not just a holiday challenge — which it is acute, probably the worst I’ve ever seen,” Weinswig said. "I think that this continues. And that is where we’re going to see innovation and new jobs created, but we’re still really short right now.”

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Aarthi is a reporter for Yahoo Finance. She can be reached at aarthi@yahoofinance.com. Follow her on Twitter @aarthiswami.