Area experts talk ongoing workforce, supply chain challenges

According to University of Kentucky professor of supply chain Dr. Haoying Sun, supply chain shortages will likely remain a problem for at least another year.

LEXINGTON, Ky. (WTVQ) – Impacts from supply chain issues and labor shortages continue to be felt across Kentucky and across the country.

According to University of Kentucky professor Dr. Michael Clark, the reasons are not all pandemic-related, but he says the pandemic made the problem worse.

“There were childcare concerns associated with the pandemic. Some people may have left the labor force because they were concerned about the health risks associated with being at the workplace,” said Dr. Clark.

Dr. Clark says that even before the pandemic, workforce numbers were declining.

“The labor force was kind of slowly declining. A lot of that had to do with the aging population,” said Dr. Clark.

According to Dr. Clark, the economy now is about as good as it was pre-pandemic, but the issue is the lack of workers available. However, he says this may change soon.

“We are starting to see, over the last six months, some increases in the labor force now. We’re seeing some people starting to come back,” said Dr. Clark.

Dr. Clark says this is in no small part due to companies offering higher wages due to the labor problem, which he says might be a key role in helping to reverse labor issues in Kentucky and the country.

“The first thing you’ll see is that employers will start to raise wages to attract more workers. I think we’ll see more people come back into the workforce due to those higher wages,” said Dr. Clark.

Another ongoing issue is the global supply chain shortages, causing a huge increase in shipping rates and shortages of important items for manufacturers. According to University of Kentucky professor of supply chain Dr. Haoying Sun, computer chips, used by many Kentucky auto and appliance manufacturers, are among the items difficult to keep stocked. Dr. Sun says the supply-and-demand issues will remain a problem for at least another year.

“Eventually, it will ease out certainly. For some sectors, it may take longer, it depends on how fast you can adjust the supply. But it will eventually ease out,” said Dr. Sun.

However, Dr. Sun says it’s not all bad: the ongoing workforce shortage is opening up opportunities for young supply chain professionals.

“For example, I look at my students, it’s a really good time for them to enter the market because of the shortage of supply chain professionals. So we see the good parts and the bad parts,” said Dr. Sun.

The University of Kentucky held its annual Economic Outlook Conference Tuesday at the Central Bank Center in Lexington.