Summertime is pool time, but the U.S. is facing a supply chain shortage in chlorine. There are also shortfalls across other industries like semiconductors, chips for automobile production, and shipping containers. How do supply chains affect the labor market and inflation, particularly in a pandemic economy?
“The goal of supply chain management at its core is really quite simple,” said Gregory DeCroix, professor of operations and information management and the academic director of the Grainger Center for Supply Chain Management at the Wisconsin School of Business. “It’s trying to match supply with demand. Making that happen is much more challenging. A lot of these shortages and delays that we’re seeing are due to one of these things: either supply is at least temporarily constrained somewhat, so we don’t have as much as demand is asking for, or demand has surged or shifted in some unexpected way and outstripped supply.”
While these are two typical scenarios, DeCroix said, there’s another aspect to consider. “From a supply chain perspective, I also want us to think about the connections between supply and demand—those things behind the scenes that allow us to bring product from its source to where it’s demanded. With bottlenecks and things occurring in those, even if you have enough supply to meet demand, you might still have shortages and delays because of the friction that’s happening within the supply chain.”
DeCroix shared these and other insights during the virtual series, “The UW Now Livestream: Supply Chains, Labor, and Inflation.”
He was joined by Kim Ruhl, associate professor of economics and the Mary Sue and Mike Shannon Chair in Economics. Ruhl is also associate director of the Center for Research on the Wisconsin Economy (CROWE).
The live YouTube event was hosted by Mike Knetter, president and CEO of the Wisconsin Foundation and Alumni Association (WFAA) and former WSB dean. Watch the full video: