The nation’s supply chain has endured nearly crippling breakdowns for over two years. The coronavirus pandemic caused production, shipping, and delivery delays throughout the United States and abroad. The supply chain crisis was poised to worsen with a railway worker strike initially set to commence this Friday, September 16th. The Biden administration struck a late-night deal with the railway workers, setting the stage for the timely transportation of the raw materials and goods military members, everyday civilians, and businesses need.
The Railway Agreement is a Boon to all Economic Sectors
Supply chains are essential in national defense as they transport the raw materials used to make military weapons. Furthermore, rail lines transport just under one-third of the country’s supplies and goods, meaning military service members and everyday people depend on trains to run on time and arrive as expected. President Biden stressed the railway deal’s importance in assisting business owners, consumers, employees, farmers, military members, and civilians.
The federal government’s executive branch helped guide railway union representatives and railroad heads to a mutually beneficial agreement. The two sides engaged in negotiations for nearly 24 hours this past Wednesday at the Labor Department headquarters in the beltway. If the two sides had not agreed, the railway worker strike would have started this week. A rail line shutdown isn’t precisely a doomsday scenario. Yet, it would cause economic and social problems, bringing business operations to a crawl throughout the United States and potentially causing food and product shortages that ramp up inflation and spur unrest.
An Agreement That Advances the Collective Interest
The constant tug of war between rail workers and railway business owners appears to have concluded, albeit not permanent. The tentative agreement provides hardworking rail line employees with more financial compensation, affordable healthcare costs, and more comfortable working conditions. In the end, it can be said without the slightest doubt that the railway agreement is mutually beneficial to both parties, including the nation’s selfless military members and hardworking civilians. They sacrifice their interests for the greater good.
Though the general public is aware that the supply of products has declined while prices have increased, there is some confusion as to why. Supply chain industry veterans quickly testify that the industry has endured significant headwinds, meaning external pressure, that has mitigated supply chain efficiency dating back to the beginning of the pandemic. The little-known truth is that a railway worker strike would have caused manufacturing plants throughout the nation to shut down. Manufacturing plants are essential for safe and healthy living as they maintain water cleanliness.
The Supply Chain Risk Lingers
Though the railway deal described above is a short-term victory, it is only one piece of the overarching supply chain puzzle. It is no secret that the production, transportation, and sale of goods have become egregiously expensive since the pandemic began. The laws of supply and demand dictate that the reduction in supply causes price hikes until the need dissipates or supply increases. The railway deal mitigates rail-related supply chain challenges, yet supply and demand imbalance looms ominously for a third consecutive year.
In the context of the armed services, supply chains are essential as the United States has become increasingly interdependent on other nations for goods. According to Statista, imports have increased in the past couple of years, jumping from about 10% of the nation’s gross domestic product in the 90s to just under 15% in 2019.
Military service members depend on defense contractors located in the free land. Yet, they rely on production facilities in China, other parts of Asia, and elsewhere. Such facilities came to a grinding halt during the coronavirus pandemic and slowly resumed production in the years since. However, it has been a struggle to return production facilities to total capacity due to supply shortages, labor shortages, inflation, and other pandemic and recession-related challenges.
Action Electronics Modern Solutions for the Armed Services
Action Electronics is proud to serve the collective interest of the American people as a supply chain management and procurement service for the United States government. We are a fully certified provider of industry defense solutions. Our tech uses the industry’s top tech innovations to craft creative, cutting-edge solutions that make your processes as efficient as possible.
Whether you need supply chain assistance, inventory management, packaging, or Stock for Sale services, Action Electronics has it. Contact us at (508) 668-3131 to learn more about our defense and aerospace supply chain services.