(WGHP) — You’d be hard-pressed to find anyone who predicted that we’d still be this affected by the COVID-19 pandemic more than 20 months in.
This is why Daniel Hall, the dean of the Phillips School of Business at High Point University, is quick to say, “Anyone who says they know exactly when it’s going to end is probably embellishing a little bit.”
But one thing economists like Hall do know is that we, as a society, should all follow the Hippocratic Oath and, above all, do no harm.
“Don’t mess with prices. Prices are a signal wrapped in an incentive that says bring resources here, combine resources that way and entrepreneurs are rewarded for doing it right, punished with losses for doing it wrong,” Hall said. “And so, you start to mess with that price system, you’re going to further snarl the supply chain – make it even worse.”
We’ve seen shortages of goods before – even anticipate them, at times.
“We talk about shortages that come during storms and people are used to responding rationally to that, like running to get the milk and bread and water,” Hall said.
But Dave Bates, the senior vice president of operations for Old Dominion Freight Lines, America’s second-biggest trucking firm, based in Thomasville, sees a different shortage every day: workers.
“Employment opportunities are high but employees don’t want to work – many of them just want to stay at home,” Bates said. “It’s hard to put people in [logistics jobs] and it’s just creating a backlog. That’s why we have 100-plus vessels off the coast of Los Angeles, right now.”
And it’s a problem for Old Dominion, as well, even with strong pay.
“It’s a great living,” Bates said. “Our drivers – we call line-haul drivers who move over the road – they’re making $100,000 a year, on average. Our local drivers who go out and pickups and deliveries and come back, they make almost $80,00 on average. Our forklift operators, these guys are making $64,000 a year, no experience and if they show up to work, take instruction, show that they can work well with others, we promote them from within. We teach them how to drive a truck, then they go get their CDL license and they can drive for us,” making that six-figure salary.
But these are strange times in the supply chain world.
“I’ve been doing this for 35 years and I’ve never seen this before,” Bates said. “I’ve never been through a pandemic – which none of us have – and I’ve never seen freight levels come back the way they are and I’ve never seen so much trouble to hire people at all levels: drivers, dock workers, maintenance technicians, clerical supervisors, sales reps, IT professionals, we are struggling to hire every position we have at this company.”
One thing Bates would like to see is a little less hard regulation from the federal government. He notes that more than 60% of his company is vaccinated but if the government mandates either being vaccinated or tested, every week, that will be a problem.
“Is it practical to think we can test 11,000, 12,000 employees (the number yet to be vaccinated) once a week? And we’re a 24-hour-a-day operation so they don’t all start at the same time. How do you do that? How do you manage that? Where are the test kits? Who’s going to test?” Bates said. “I think we have to let it take its course. I wish there was the magic button or the magic pill, right? But it’s not – we just have to let this thing play out.”
And, like a true economist, though, Hall sees opportunity within the chaos.
“Today’s inefficiencies are tomorrow’s opportunities so, be patient, be aware, be entrepreneurial,” Hall said.
See more on the logistical nightmare that is our worldwide supply chain in this edition of the Buckley Report.