From Coffee to Microchips – How the Supply Chain Crisis Is Disrupting UK PLC

The UK is experiencing a supply chain crisis following the COVID-19 pandemic. According to experts, labor shortages are driving and triggering Britain’s problems for the entire economy. Besides the deficiency of McDonald’s milkshakes, the building industry is reeling from the scarcity of gypsum board and cement distributors.  

As that isn’t bad enough, the global microchips deficit has affected manufacturers and scaled-down car production, demonstrating the urgent need for supply chain management during a crisis. The industry’s demands are rising sharply as the world emerges from the blockade, escalating prices for various raw materials.  

The UK economy almost came to a standstill in July when the crisis caused a labor shortage and then hindered material growth. Recent official figures suggest that GDP growth was only 0.1% in July, even though the government had relaxed most of the COVID-19 related restrictions. Here is how the supply chain crisis has affected different industries in the UK:

Food Production

Fruits are rotting on farms; consumers can’t get milk on time, while slaughterhouses cannot process chicken and pigs. The reason behind these problems is not the lack of enough food but the shortage of workers. As a result, food and coffee prices have skyrocketed globally, while pasta prices are likely to rise due to drought and increasing temperatures in Canada. 

Italy is also facing critical supply issues as the Recruitment of European Union workers dropped more than that of the domestic markets. For example, the number of Bulgarian and Romanian employees who filled lowly paid food production and logistics roles has fallen by nearly 24% or 90,000 since the beginning of the pandemic. Employees from eastern European countries like the Czech Republic and Poland have also dropped by over 12%, or 100,000. 

Manufacturing

The manufacturing industry in Britain has been facing the worst scarcity of raw materials and components since 1977, which has hit factory production while delaying the country’s economic recovery. Moreover, microchip shortages have hindered production in the entire manufacturing industry, forcing vehicle makers to scale down their planned operations. Delivery times for various consumer products like smartphones and microwaves have also been affected. 

Hospitality

Supply chain congestion has triggered chicken scarcity in some KFC and Nando’s restaurants, lager and toast from Wetherspoon’s, and milkshake at McDonald’s. While restaurants and pubs experienced increased bookings after the lockdown eases, many venues still struggle to regain footing. Employers are having difficulty finding cleaners, kitchen porters, and cooks, while numerous firms are experiencing severe labor shortages, which were last reported in 1997.

According to the proprietor of Ma Boyle’s Alehouse & Eatery in Liverpool, many businesses in the hospitality industry have spent their summer attempting to determine effective methods of running their businesses amid the pandemic. The staffing crisis and Brexit-based supply problems have only worsened the situation. 

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