Economic Analysis of The Covid-19 Pandemic
The Covid19 pandemic has caused continuous disruption in global supply chains. Many nations have experienced problems in the supply chain and these have had global effects. China, for example, has been hit by power outages that have impacted their manufacturing industries. A shortage of truck driver and dock workers has led to lengthy delays at the ports. Finally, rising energy prices are leading to dramatic increases in the costs of production.
Analysis of recent economic data including the unemployment rate, inflation rate, supply chain and logistics data and citizen opinions have revealed some disturbing trends. Longitudinal data being collected for all of 2021 will be analyzed to determine the potential impacts moving forward in a search for possible solutions to these problems.
Analysis of supply chain data, inflation rates and supply chain and logistics data seem to indicate the problem will likely get worse in the short term. Particularly hard hit is the restaurant and the food service industries which are having great difficulty hiring workers. Part of the labor shortage can be traced to the unemployment payments and government stimulus checks which continue keep people out of the workforce. According to the New York Times, this government aid has enormously helped workers to have financial security and hence, these workers are reluctant to go back to their previous jobs. (https://www.nytimes.com/2021/10/20/briefing/labor-shortage-us-low-wage-economy.html)
Labor shortages notwithstanding, it now seems inevitable that the inflation rate will rise to a high not seen in decades. According to the U.S. Bureau of Labor Statistics, the price of the commodities has increased by over 19% over the year (https://fred.stlouisfed.org/graph/?g=EKIy) and the inflation rate is also predicted to rise dramatically.
The US economy has not faced such rapid inflation and price increases since the mid-1970s. The current economic issues such as the dramatic increase in commodity prices, shortages of goods and services, rising inflation and uncontrolled government spending may exacerbate the problem and plunge the world into catastrophic recession.
Keywords - Supply Chain, Inflation, Unemployment, Logistics, COVID-19, Economy, Trend Analysis