Where's the beef? And the toilet paper?
Is it possible that our supply chains won't be going back to normal any time soon?
Let’s talk about supply and demand. Back at the start of the pandemic, certain items - toilet paper, yeast - were nearly impossible to acquire. Pending lockdowns caused people to rush to stores and stock up on goods they would typically purchase in small batches or not at all. Over a year and a half later, many places are again seeing emptier-than-normal retail outlets.
Food shortages have been a particular feature of this rendition of the supply chain slow down. Shortages are not uncommon when spending increases in other areas to respond to a crisis and when geopolitics have been thrown for a loop - both of which are at play here. In times of turbulence, food shortages have often served as a breaking point. When Marie Antoinette said, “let them eat cake,” she responded to the issue that would push an increasingly unsettled populace over the edge into revolution. In the decade leading up to the May 1789 outbreak of the French Revolution, more than 300 riots broke out over bread shortages. When we celebrate International Women’s Day on March 8, we are also commemorating the day in 1917 when - following months of strikes and over two million deaths from the First World War - standing in long lines only to discover bakeries had run out of bread pushed women over the edge and sparked the flame of revolution. Bread lines have frequently served as the symbol for periods of economic downturn from major revolutions to the great depression. Though we are not yet, in North America, at the point of bread lines, the possibility of empty shelves poses a real threat to peace and stability.
While the days of bread lines resulting in a violent uprising, are - with any luck - behind us, the social significance of food shortages remains unchanged. For this reason, it is worthwhile to take a moment to reflect on our global supply chains.
In the UK, where the combined effects of Brexit and the pandemic have resulted in lines of vehicles unable to cross the English Channel, while food spoils on truck beds, the impact of supply shortages have been particularly acute. Gas stations have run out of petrol in recent weeks, and grocery stores have come frighteningly close to empty shelves. Though none in the UK resorted to violence - based on available reports - the government was forced to walk back some of the strict Brexit measures which contributed to the shortages. Industry groups warn that UK citizens may need to accustom themselves to more limited selection in grocery stores as the reality of Brexit sinks in.
The supply shortages in the UK are a symptom of another problem experienced in many countries: a labour shortage. In North America, this shortage has been pinned on government programs targeted at supporting workers. Claims have been made that despite numerous job openings, workers are less pressured to return to work, and are less likely to jump at whatever jobs become available - a shift that is not necessarily entirely negative. In the UK, a significant issue contributing to the labour shortages is Brexit policies which caused thousands of EU workers to leave the UK - these are the same policies that have now been temporarily revoked. The mass exodus has been particularly impactful. EU citizens worked in trucking, warehouse, and service sector jobs; positions necessary to keep goods equitably distributed across the island nation.
The dearth of products and labour in the UK as a result of Brexit is the actualization of arguments around foreign labour and immigration that occur the world over. Brexit did create more jobs for UK workers in the form of foreign labour leaving the country. However, these jobs were often in undesirable industries, and the supply of labour is still insufficient to fill demand without bringing in additional workers. Though current shortages remain far from the breaking points that have previously erupted into revolution, warnings from the UK’s Food and Drink Federation about the potential permanence of supply shortages raise questions about what our supply chains will look like in a post-pandemic world.
Though the circumstances in the UK are predominantly tied to Brexit policies, those in North America are not. The cost of shipping containers has risen dramatically since the beginning of the pandemic, more than doubling since 2019. Just as in the UK, there is a severe shortage of truck drivers to transport goods once they arrive that driverless vehicles will not roll out fast enough to overcome. While it is possible that as vaccinations and reopenings continue, these shortages will ebb, it is also possible that they won’t - at least for the foreseeable future. This means coming to terms with a world where our connection to California raisins and Korean skincare products may lose its regularity and immediacy.
The fragility of our supply chains has been one of the vital non-health-related lessons of the past 18 months. Economists have long discussed the idea of winners and losers of globalization. The premise of this theory is that in our globalized world, where supply chains are spread far and wide, some regions - North America, Europe, and East Asia specifically - have received the benefits. In contrast, other regions have borne the costs. The breakdowns in our supply chains that have occurred at various points since March 2020 potentially call into question how much any of us are genuinely winning at globalization today. The combined effects of waves of the pandemic, and political turbulence - Brexit, the US election, Bulgaria, or China - have necessarily resulted in shutdowns and extensive delays to various parts of our global supply chain. This carries an increased cost to consumers, and periods of empty shelves when products do not make it to market. However, a key difference between the shortages and slowdowns were seen a year ago, and those we have seen in recent weeks is that as the world continues to push towards reopening, the food shortages that we see now may not be as temporary.
While those who were able to transition our lives to working from home during the pandemic were often able to avoid the worst of its effects, avoiding empty grocery store shelves will be near impossible. If the foreseeable future is one with continually dysfunctional global supply chains, how will we all adapt?
A key lesson we can take away from Brexit is that isolation is not the answer. Though our global supply chains may be currently - perhaps forever - dysfunctional, shutting out the rest of the world is not the solution. The system we have developed relies on the availability and exercise of labour in different parts of the world, and that’s not a bad thing. The globalization ship is not sinking, but it needs rebalancing. This will not come without a period of adjustment. While I do not attempt to propose any solutions here, I would hazard that a rebalancing will involve a renewed emphasis on self-reliance. Perhaps everyone hoarding yeast was onto something.
Bread is our breaking point. It is entirely possible that over the next few years, parts of the developed world, such as the UK, will continue to experience regular shortages of items on which we have come to rely. This will be an adjustment, and not an easy one. Since the beginning of the pandemic, we have encouraged each other to shop local, and we have seen the demise of small businesses in every sector. With our global supply chains on shaky ground, now more than ever, it is essential to step back and think about where our goods come from and come to terms with what we may need to live without.
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