Transportation Secretary Pete Buttigieg told Yahoo Finance Live supply chain bottlenecks at the country's major ports will likely persist for the foreseeable future.
"We are definitely seeing some immediate impacts of the immediate steps that we have taken, but the honest answer I can give you, as long as the pandemic continues, there will be disruptions," Buttigieg explained.
The supply chain bottlenecks triggered by the pandemic continue to have multiple effects on the U.S. economy.
For one is the straight consumer angle, where shoppers may be unable to find what they want when headed to a retailer. That could become even more acute for the approaching holiday shopping season. But the other aspect is the inflationary aftermath on shoppers as companies raise prices to offset their higher costs — notably for shipping.
Consider this: More than 40% of CFOs in a recent Deloitte survey indicate supply chain shortages or delays have increased their companies’ costs by 5% or more. Meanwhile, 60% said their sales this year have either been reduced or will be by the end of the year due to supply chain problems.
Buttigieg said President Biden's new $1.2 trillion infrastructure package will help improve port congestion and lay the groundwork for better flows of goods coming out of the pandemic.
"In the long-term we will have better ports, better rails and better roads so the core infrastructure — all of those private sector processes — is more resilient for whatever challenge in the future could come, whether it's another pandemic, whether it is the extreme weather we are seeing more and more of in this era of climate change, or something we haven't even thought of," Buttigieg added.
Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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