Toward the end of last year, we invited shippers from a wide variety of industries to participate in our sixth annual State of the North American Supply Chain Survey. Our goal was to gauge the challenges that shippers faced in 2020 and to gain a better understanding of their outlook heading into the new year. Nearly 1,800 individuals from across North America participated.
Looking Back At 2020
It goes without saying that this past year marked one of the most challenging periods in both modern American and global history. The COVID-19 pandemic caused major disruptions to supply chains throughout the first half of 2020 as businesses and everyday citizens struggled to adapt to the crisis around them.
In terms of the economic toll, the U.S. gross domestic product (GDP) sunk to -31.4% in the second quarter of 2020, according to the U.S. Bureau of Economic Analysis. Our 2020 Midyear Supply Chain Survey of more than 800 shippers conducted in July illustrated the direct impact the pandemic had on many shippers. When we asked respondents what their biggest supply chain challenges were in the first half of 2020, the top three issues were a decline in customer demand (42.34%), mandated closures and stay-at-home orders (39.17%), and shortages of supplies and materials (28.22%).
As the year progressed and more shippers adapted to a new normal, fears of a total economic meltdown eased. Fewer mandated closures and stay-at-home orders in the U.S. led to increased consumer spending beyond online shopping, while construction surged as many traditional city dwellers sought a change of pace in less crowded regions. As a result, the U.S. GDP in the third quarter reversed course and surged to a positive 33.4%.
While official numbers for the fourth quarter will not be released until late January 2021, the holiday season tends to fare well as retailers see an increase in consumer spending both online and in physical stores.
All Eyes Ahead For 2021
The personal toll that 2020 took on many cannot be underestimated. Perhaps the silver lining to the end of the year, however, was what we hope will be the beginning of an end to the pandemic. As vaccines are rolled out across the U.S. and around the world, a hopeful return to normalcy is on everyone’s mind. What that normal will look like and when it will be here isn’t exactly known yet, but the desire to move forward is certainly here already.
Shippers, for the most part, are looking ahead with renewed confidence that business will increase in 2021. In North America, this will also be a defining year in terms of how the new United States-Mexico- Canada Agreement (USMCA) will impact trade and hopefully provide a positive stimulus for domestic manufacturing. From a global perspective, ongoing trade negotiations and tariffs will be at the helm of a new U.S. presidential administration. There may be a lot of uncertainty ahead, but the determination and hope shared within the transportation industry will keep us moving forward.