We use cookies to provide you with a better experience. By continuing to browse the site you are agreeing to our use of cookies in accordance with our Cookie Policy.
  • ::COVID-19 COVERAGE::
  • INDUSTRY PRESS ROOM
  • SUBMISSIONS
  • MEDIA FILE
  • Create Account
  • Sign In
  • Sign Out
  • My Account
Free Newsletters
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
  • STRATEGY
  • GLOBAL
  • LOGISTICS
  • MANUFACTURING
  • PROCUREMENT
  • VIDEO
    • News & Exclusives
    • Viewer Contributed
    • Upload your video
  • BLOGS & MORE
    • White Papers
    • Webcasts
    • Events
    • Blogs
      • SCQ Forum
      • Reflections
    • Mobile Apps
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
  • STRATEGY
  • GLOBAL
  • LOGISTICS
  • MANUFACTURING
  • PROCUREMENT
  • VIDEO
    • News & Exclusives
    • Viewer Contributed
    • Upload your video
  • BLOGS & MORE
    • White Papers
    • Webcasts
    • Events
    • Blogs
      • SCQ Forum
      • Reflections
    • Mobile Apps
Home » Don't breathe a sigh of relief just yet
Perspective

Don't breathe a sigh of relief just yet

August 11, 2010
James A. Cooke
No Comments

Data from the 21st annual "State of Logistics Report" released by CSCMP in June show that the U.S. economy has been through the wringer over the past year. The results also suggest that although a recovery will surely come, supply chain professionals need to be prepared for a different business climate than what they experienced after previous recessions.

That's because of something that the "State of Logistics Report," which deals with freight movements and inventory, does not show: the nation is undergoing a jobless recovery.

Although a recovery will surely come, supply chain professionals need to be prepared for a different business climate than what they experienced after previous recessions.

Although some have compared the current downturn to the Great Depression of the 1930s, I believe that in some ways it more closely resembles the so-called Long Depression, which occurred between 1873 and 1879. Estimates for unemployment during that period hover around 10 percent.

According to most historians, economic output increased during the Long Depression, yet many folks remained unemployed. As the economy transitioned from agriculture to manufacturing, displaced farm workers could not find factory jobs because the increase in plant output was due in good measure to the adoption of new technology.

Right now the U.S. economy is undergoing a similar structural change. The parallels are striking: Automation, outsourcing, and offshoring are eliminating many jobs forever as the nation moves from manufacturing to an economy that focuses on services, knowledge, and creativity. There will be jobs for computer programmers, software engineers, biotechnicians, doctors, and the like. But an out-of-work construction or factory worker is unlikely to have the skills sought by employers during this period of adjustment.

The U.S. economy has largely been driven by consumption, and without an uptick in overall employment, consumers will hold back on spending. In fact, a recent Booz & Co. survey found that U.S. consumers have cut back their spending to a degree not seen since the Great Depression. That will put pressure on retailers and manufacturers to at least hold steady, and more likely reduce, the prices of their wares.

Companies will increasingly turn to the supply chain for ways to keep prices in check. Supply chain chiefs can expect to find themselves in the hot seat as executive boards require them to do even more in that regard. Those who can innovate and find new ways to save supply chain dollars will be the stars when the economy comes roaring back ... as it will, just as the Long Depression gave way to the good times of the Gilded Age.

  • Related Articles

    A recovery is coming, but don't breathe a sigh of relief just yet

    Don't bank on federal money for infrastructure improvements

    Supply chain redesigns: not just about the oil

James A. Cooke is a supply chain software analyst. He was previously the editor of CSCMP's Supply Chain Quarterly and a staff writer for DC Velocity.

Recent Articles by James A. Cooke

Getting smart about using software intelligence

The payback challenge

A farewell, with thanks

You must login or register in order to post a comment.

Report Abusive Comment

Most Popular Articles

  • The 3PL industry: time to reset

  • Resiliency starts with supplier mapping

  • Freight market growth expected to slow in 2021

  • COVID-19 and the health care supply chain: impacts and lessons learned

  • Retailers designing stores to support inventory and logistics work, not just shopping

Featured Video

6cabd6ef 64df 4460 bb11 e90c2bdea0a5

Identifying Intralogistics Solutions to Fit Your Operation: LinkedIn Live Ep. 4

Viewer Contributed
As technology evolves, the advantages of using semi- and fully automated solutions to increase productivity and address labor shortages are clear. However, before an organization jumps fully into automation, optimization is a key step that must happen first. Intralogistics solutions, such as Raymond’s iWAREHOUSE and...

FEATURED WHITE PAPERS

  • Using innovation to manage peak seasonal demand

  • Warehouse Management System Project Toolkit

  • Solving Talent Management Challenges Now and In the Future

  • Shaping Up Last Mile Delivery to Surpass Customer Expectations

View More

Subscribe to Supply Chain Quarterly

Get Your Subscription
  • SUBSCRIBE
  • E-NEWSLETTERS
  • ADVERTISING
  • CUSTOMER CARE
  • CONTACT
  • ABOUT
  • STAFF
  • PRIVACY POLICY

Copyright ©2021. All Rights ReservedDesign, CMS, Hosting & Web Development :: ePublishing