Fed polls: Product shortages to continue through late 2022
A new report from the Federal Reserve Bank of New York found that, "Businesses foresee further worsening in supply-chain issues." Above, container ships are seen docked at the Port of New York and New Jersey in Elizabeth, N.J., on May 20, 2021. Credit: AP / Seth Wenig
The supply chain disruptions that have led to empty store shelves and higher prices will continue through at least late this year, based on the predictions of executives at factories, service firms and retailers.
The Federal Reserve Bank of New York said it was told by service firms and stores that they expect supply shortages for an additional seven months, on average. Manufacturers forecast an additional nine months.
"Businesses foresee further worsening in supply-chain issues," the bank said in a report last week.
"Not surprisingly, 65% of service firms and 85% of manufacturers report that they are currently having trouble obtaining needed supplies," it said.
The New York Fed surveyed about 125 factories across the state and about 200 service firms in the metropolitan area on Feb. 2-9, with Long Islanders participating in both polls.
The bank asked business executives about employee absenteeism because of the surge in COVID-19 cases tied to the omicron variant.
"Over half of service firms and more than three in five manufacturers characterized absenteeism as unusually high" in January, the New York Fed said, adding 12% of employees missed at least one workday last month compared with 5% in a typical January.
"A sizable number of service firms — especially in the education/health and leisure/hospitality sectors — cut back on the volume of service they provide" because workers were out sick, the bank said. "Businesses in manufacturing and distribution, on the other hand, were more inclined to increase the hours of those who were present at work, as well as make more use of outside contractors or temporary workers."
Separately, both service firms and factories reported having more job openings than in past years, with vacant positions representing 5% of the total workforce on average.
"This proportion had never exceeded 3% for factories or 2.5% for service firms" in more than eight years, the New York Fed said.
James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.
Updated now Newsday travel writer Scott Vogel took the ferry over to Block Island for a weekend of fun.
Updated now Newsday travel writer Scott Vogel took the ferry over to Block Island for a weekend of fun.
