Tattoo and piercing shops ‘can’t just use less’ when it comes to gloves and disinfectant, crucial supplies that shop owners say are still experiencing crippling shortages 16 months into the pandemic

tattoo artist
A tattoo artist wearing gloves at work in KOT Tattoo Studio during the COVID-19 pandemic

In the before times, pre-pandemic, Carl Kuo took a regular trip to Costco to buy gloves by the thousands.

Kuo is the owner of Mission Ink Tattoo & Piercing in San Francisco. He said his artists typically go through four or five pairs of gloves for each tattoo they do, while they set up their work stations, tear them down, and create art in between.

“Now they just have zero stock. Whenever [gloves] come in, they’ll be gone within an hour,” he told Insider. “And this is, what, July? Months into COVID.”

Kuo is one of three tattoo and piercing shop owners who told Insider that they’re still seeing serious shortages and skyrocketing prices for items their shops use daily, crucial supplies like gloves and disinfectant. Combined with a year of frequent shut-downs and restrictions on their operations, supplies scarcities are just another frustrating cost of doing business.

“We’re fighting with the healthcare providers, who rightfully should have first dibs on everything,” Kuo said.

‘You can’t just use less’

Person wearing gloves holds pierced ear of woman wearing mask
A woman gets her ears pierced in August 2020.

The shortages come at a time when business is booming for the tattoo and piercing industry.

Shop owners recently told Insider that they’re busier than they’ve ever been and that people are lining up down the block to get a new piercing or tattoo to memorialize loved ones who died during the pandemic, or simply to feel alive again after a year in isolation. According to IBIS World analysts, the $1.2 billion tattoo artist industry is expected to increase its market size by 6.6% this year.

Read more: How much should you be paid? Browse more than 250,000 salaries from 250 of the country’s largest firms

Paul Stoll, the owner of a piercing shop called Body Manipulations, also in San Francisco, told Insider he’s noticed a surge in demand, but that “the numbers can also be askew” – for instance, a box of gloves that typically cost him $8 is now $45, a cost he’s had to pass on to his customers.

“If you’re good at business, you have to raise your price a little bit. You have to account for that,” he said.

Kuo said that during particularly lean times supplies-wise, he’s had to resort to other means of getting what he needs: One of his piercers wears extra-small gloves, and when he couldn’t find any in stock, he had a friend in Los Angeles FedEx him a box to tide him over.

Kuo said he’s also had to raise prices for piercings and tattoos, especially in light of jewelry suppliers raising theirs: Everything from implant-grade stainless steel to titanium to gold has gotten more expensive, he said.

Paul Collurafici, the owner of Tattoo Factory in Chicago, said he’s also had a hard time finding gloves, and is seeing a significant spike in prices: A case of 12 boxes of gloves used to cost him $50 – “now you’re lucky to find a case for $200,” he said.

Collurafici is seeing prices continue to soar for other essential items as well. A large pack of paper towels, which he said his shop goes through “like crazy,” used to cost him $14.99, but now runs him upwards of $49. Cavicide, a surface disinfectant that kills bacteria and viruses, now costs as much him as $30 a gallon, up from $7.

There are also limits on how many cases of the solution suppliers will sell him, which has made tracking it down “a never-ending job.”

“We need a certain amount,” he said. “You can’t just use less.”

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What to say when someone tells you ‘people don’t want to work right now’

A sign reads "We all quit" at a Burger King in Nebraska
  • As stories about labor shortages continue to pop up, it might seem like no one’s working.
  • The truth, of course, is far more complicated – just like the strange economy right now.
  • Importantly, the pandemic is still ongoing, and workers have a lot more options.
  • See more stories on Insider’s business page.

It’s a common refrain right now: No one wants to work. It’s a twist in the story of a not-quite-post-pandemic economy that left millions of people unemployed, as understaffed businesses struggle to hire and workers quit en-masse.

But, as always, the economy is complex, and so are the myriad of people who keep it running. A simple phrase doesn’t capture all of the complexities of why people may or may not be working. If you want to inject some nuance into your next conversation about the labor shortage, here’s what to know.

The pandemic is still going on

If the Delta variant has taught us anything, it’s that COVID is still spreading – and it’s still impacting the economy.

For instance, childcare – or lack thereof – has emerged as one potential driver keeping parents out of the workforce. With schools and daycares shuttered, some parents left their jobs to provide care. Others may have lost their roles, and delayed searching for new ones while their kids were at home. Either way, they may not have returned to the workforce yet.

Sociologist Jessica Calarco tweeted recently about the challenges facing parents as children remain unvaccinated and variants spread, noting that classrooms and daycares may have to temporarily shutter as cases come up.

“Given that kids aren’t going to be eligible for vaccines any time soon, and with Delta spreading rapidly, we should expect a whole lot more of this to come. I won’t be surprised if we end up with a whole bunch more 2-week gaps (or longer) in childcare this fall,” she wrote.

COVID fears have also kept some older workers out of the workforce. They were disproportionately impacted by job losses early in the pandemic, and some have called it quits and retired altogether.

Fed Gov. Lael Brainard said that labor shortages should fade by fall as schools reopen and fears abate, along with federal unemployment benefits.

Workers are taking advantage of more options

A huge amount of workers are quitting their jobs, which seems counterintuitive. In May, 3.6 million workers quit their jobs – but it may be because they are taking advantage of new opportunities.

Wages in industries that are having difficulty staffing up – like leisure and hospitality – are on the rise, but they’re still relatively low compared to other fields. Dr. William Spriggs, an economics professor at Howard University and chief economist at the AFL-CIO, previously told Insider that “workers who are employed are finding ways to get jobs in the sectors that are expanding and hiring.” Those sectors might offer higher wages, or at least more consistency than their prior roles.

It’s what Insider’s Aki Ito calls The Great Reshuffle: An unprecedented labor market, coupled with a rethinking of what workers want out of both work and life, has led many to exit their positions or seek out new ones. The market out there for workers is competitive, and many are finding higher salaries or better positions as they depart their old roles.

And yes, some workers may not be returning because they’re benefiting from enhanced unemployment benefits. As Insider previously reported, the consistent pay from unemployment – as well as the fact that it’s higher than what some workers made before – has caused some to rethink work.

“I just think that UI has just at least fixed everyone’s brain enough to see how f—ed up the wages are,” Matt Mies, an unemployed 28-year-old, previously told Insider.

But, as always, the picture is still nuanced. Many workers will find themselves cut off completely – including those who have been frantically searching for work.

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As gas soars to its highest price in 7 years, a shortage of tank truck drivers may leave some stations without any this holiday weekend

gas station
A man fills up a car at a filling station.

  • Gas prices are at an almost 7 year high, at about $3.10 a gallon for regular.
  • An estimated 47 million Americans are expected to travel by car this weekend, AAA reported.
  • They may not find gas at stations due to a tank truck driver shortage, CNN reported.
  • See more stories on Insider’s business page.

Gas prices will be the highest they’ve been in nearly seven years and some gas stations may not even have any, CNN reported.

The average cost for a regular gallon is the highest since October 2014 at about $3.10.

GasBuddy Head of Petroleum Analysis Patrick de Hann said that the high price is likely to remain high after the holiday weekend.

Additionally, a shortage of tank truck drivers who drive gas to stations could mean some stations may not have any gas at all.

Tom Kloza, global head of energy analysis for the Oil Price Information Service, told CNN the shortages are spread out across the country.

“It used to be an afterthought for station owners to schedule truck deliveries. Now it’s job No. 1,” Kloza told CNN. “What I’m worried about for July is the increased demand works out to about 2,500 to 3,000 more deliveries needed every day. There just aren’t the drivers to do that.”

De Hann said the demand for oil is still the same, so the lack of gas at stations is simply due to the shortage of drivers.

More than 47 million Americans are expected to travel by car this July 4 weekend, AAA is forecasting.

Klonza told CNN that not finding gas at stations could mean people start topping off their tanks more frequently, which may in and of itself cause a shortage down the line.

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Your bank or grocery store might be out of coins, but the Fed says there’s not actually a shortage – people just aren’t using them

change drawer coin shortage
The empty change drawer of the cash register at Symbiote Collectibles in West Reading, PA July 9, 2020.

  • The coronavirus pandemic has disrupted the availability of quarters, nickels, dimes, and pennies.
  • Unlike supply issues that have affected computer chips and lumber, there’s no actual shortage of coins.
  • Roughly $48.5 billion of coins are in circulation, but much of that is “sitting dormant,” the Fed says.
  • See more stories on Insider’s business page.

If you’ve gone to the bank or grocery store recently, you may have noticed an availability problem that originally reared its head at the height of the pandemic last year: there aren’t any coins.

Meanwhile, manufacturers can’t get enough semiconductor chips because there aren’t enough being made. Home prices are at record highs because there aren’t enough houses. Used-car prices are soaring because there’s no such thing as a used car factory.

So when is a shortage not really a shortage?

Last month, the US Federal Reserve acknowledged that businesses and banks in various parts of the country were once again having a hard time getting their hands on enough quarters, nickels, dimes, and pennies.

But this time is different.

“Since mid-June of 2020, the U.S. Mint has been operating at full production capacity,” the bank said. Last year the Mint produced 14.8 billion coins, up 24% from the year before.

It’s not a shortage, per se, but that doesn’t explain why you can’t get a roll of quarters to do your laundry.

To find out, the Fed and other partners did what they do best: convened a task force.

The US Coin Task Force discovered that of the roughly $48.5 billion of metal currency in circulation, much is “sitting dormant” in the pockets, jars, and couch cushions of America’s 128 million households.

In other words, there are more than enough coins in existence, they just aren’t flowing smoothly thought the economy. Money, as you may recall, serves three key functions: a unit of account, a store of value, and a medium of exchange.

“The weak circulation affects most everyone, but the hardest hit are small cash-dependent businesses and those who are least well off,” task force member Hannah vL. Walker said in a statement. “For millions of Americans, cash is the only form of payment.”

Right now, the dormant coins are performing the first two roles just fine and failing at the third. The problem for the Mint is that it can’t arbitrarily make more coins available without causing a lot of other problems in the US monetary system.

The tack force recommends an even simpler solution: break open that piggy bank.

“If just a fraction of the coin sitting dormant in households and businesses is redeemed and reused, this problem can be greatly reduced,” the task force said.

By spending, depositing, or converting unneeded coins, the Mint said consumers can help close the circulation loop that has been disrupted over the past year and get a small but important part of the market moving again.

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One shocking chart shows used-car prices jumping another record amount in May, highlighting the strange gaps in the economy’s recovery

Used car sale dealership
Sale signs lie on vehicles at a General Motors Chevrolet dealership July 6, 2005 in Ferndale, Michigan.

  • Used-car prices likely jumped yet again in May, UBS says, following a 68-year record in April.
  • Used cars have been one of the primary drivers of increased consumer inflation.
  • It’s one strange part of the puzzle that is America’s economic recovery from the pandemic.
  • See more stories on Insider’s business page.

If you’re in the market for a used car, be prepared for some sticker shock. Prices are projected to have skyrocketed again in May, and that boom is probably going to be a primary driver of increased inflation.

A note by a group of UBS researchers, led by Alan Detmeister, forecast a 10.8% price increase. That’s even higher than April’s record-breaking surge of 10%.

used car prices jump
Chart via UBS.

Those pre-owned cars are adding significant mileage to inflation in the US. UBS projects that core Consumer Price Index (CPI) will have another “massive” rise in May; simply put, that means things got even more expensive. That follows a 13-year high in April. In both April and May, the increase is “heavily driven” by used car prices, according to UBS.

Used cars are just one of a myriad of shortages throughout the US economy, part of the country’s strange rollercoaster of a recovery. A global computer-chip shortage has wreaked havoc on the automotive industry, potentially costing it up to $110 billion just this year, Insider’s Dominick Reuter reported. Those chips are used for everything from car engines to Bluetooth capabilities. That’s slowed production of new cars – right when Americans are itching to buy them, as Insider’s Katie Canales reported.

“With pressures on the used car market, along with returning demand for travel, we expect further increases in these categories in the coming months,” the UBS researchers write. They also expect “solid” price increases for new cars and apparel.

Another shortage could be holding up economic recovery

Last week brought the May jobs report, which tracked payroll gains for the month. It showed signs of labor-market acceleration, as Insider’s Ben Winck reported, with the unemployment rate dropping. However, the number of payrolls added came in below expectations.

A separate UBS note from researchers led by Andrew Dubinsky said jobs are rebounding slower than expected because of shortages – “temporary labor supply bottlenecks implied by strong wage gains are slowing growth.” For instance, the youngest workers, who are 16 to 24, saw declines, which UBS attributes to them potentially returning for in-person schooling.

So something else is getting more expensive: The amount that workers get paid. Employers are forking over more money to try and get workers to join their workforce.

As the UBS researchers write, “Annualized leisure wage growth of around 20% in the past three months suggest the recovery is being held back by labor supply.” That wage growth signals that labor-market-supply issues will be temporary, UBS said.

But it’s not just a matter of wages keeping people out of the workforce. Some unemployed workers are rethinking work and what they want out of it, while others struggle with a labor mismatch – the jobs that are open don’t necessarily fit with their skills, or previous experience. Despite all of that, it doesn’t appear that increased unemployment benefits kept workers from returning in May. In 25 GOP-led states, governors have prematurely announced an end to federal benefits to get workers back, but, as Insider’s Ayelet Sheffey reported, they returned regardless.

And, of course, there’s still an ongoing pandemic. UBS, which is “optimistic” about labor force participation in the coming months, notes COVID fears may subside. That’s one factor that may have been keeping older workers from returning.

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Costco says it’s getting more expensive keep the rotisserie chicken at $4.99, but it won’t raise the price

Costco employee chicken
  • Costco CFO says that the company is under “inflationary pressures” with shortages.
  • The company says it won’t increase the $4.99 rotisserie chicken price.
  • The rotisserie chicken is sold at a loss to draw in customers.
  • See more stories on Insider’s business page.

Costco’s famous $4.99 rotisserie chickens are getting more expensive for the store to stock, according to Chief Financial Officer Rich Galanti.

Inflation and rising costs are making nearly everything more expensive for consumers, from meat and cheese to electronics. Big box stores like Costco aren’t immune to these higher costs, some of which may be passed on to customers, Insider’s Áine Caine reported.

Costco is under “inflationary pressures,” Galanti said in an earnings call, including “higher labor costs, higher freight costs, higher transportation demand, along with the container shortage and port delays,” along with widespread shortages.

Read more: Ghost kitchens operators like CloudKitchens, Kitchen United, and All Day Kitchens are expanding their business models beyond the rent-a-space model as competition heats up

The price of a rotisserie chicken should stay the same for customers, though Galanti says “there’s been some pressure on some cost components of these items. So those are already impacting our margins a little.” The chickens were already sold at a loss for Costco – the $4.99 price has remained the same since 2009, even as costs of labor and production have increased.

“When others were raising their chicken prices from $4.99 to $5.99, we were willing to eat, if you will, $30 [million] to $40 million a year in gross margin by keeping it at $4.99,” Galanti said in 2015. The chickens are sold at a loss, but they, along with gas and food court items, draw customers into stores where they might make other more profitable purchases.

The rotisserie chickens are also a Costco staple. The big box store sold 87 million in 2017, and 91 million in 2018. To keep costs as low as possible, Costco opened the $450 million facility in Nebraska in 2019, which processes about 2 million chickens a week, with plans to eventually supply nearly half of the chain’s total chickens.

As prices increase, hot dogs are the other staple Costco customers can count on to stay at the same price, even as beef costs surge as much as 20%. The hot dog and soda combination has been priced at $1.50 since 1985.

Do you have a story to share about a retail or restaurant chain? Email this reporter at mmeisenzahl@businessinsider.com.

Read the original article on Business Insider

It might be the worst time to remodel your house. Experts say customers can expect months of delays.

home buying
  • Home-improvement projects are being set back by months due to shipping delays and shortages.
  • The home-buying and remodeling boom has companies struggling to keep up with demand.
  • Skyrocketing lumber prices are also making projects increasingly expensive.
  • See more stories on Insider’s business page.

The pandemic caused a surge in home-improvement projects at the worst possible time and many companies are still struggling to keep up with backlogs of projects.

Over 44% of home improvement plans in the US have been delayed due to supply shortages and skyrocketing material costs, according to data from market research firm, Cardify.ai, a company that uses transactional data to generate reports on consumer spending.

Steve Cunningham the CEO of Cunningham Contracting and the chair of the National Association of Home Builders’ (NAHB) Remodelers Council said his projects are being delayed by months due to the limited availability of materials, as well as laborers. Data from the NAHB Remodeling Market Index indicates that, on average, home improvement projects are facing 1-2 months of delays.

Home construction
A red-hot real estate market has kickstarted new home construction, but builders face a shortage in lumber.

“A lot of remodelers have more business in front of them than they can service,” NAHB Chief Economist Robert Dietz told Insider.

John Bitely, the president of Sable Homes, a home-building company based out of Rockford, Michigan, told Insider that in 30 years of business he’s never seen such demand.

“We usually build houses to sell them,” Bitely said. “We have virtually none of those available right now because all of our labor and production is fully absorbed with creating pre-sold homes. Every home we’re making is already sold because people are chomping at the bit for these new homes and we can’t build our way out of it.”

Not only are home-improvement projects lagging due to spikes in demand, new homes have also become an incredibly hot market. Last month, mortgage giant Freddie Mac reported that there is a shortage of nearly 4 million homes in the US.

Government agencies are backed up

Bitely said Sable Homes faces delays from the very beginning of a project, as government agencies have been slow to give out the necessary home-building permits, adding at least two weeks to the waiting process.

He attributes the delay to the sheer amount of permits government agencies are rushing to approve as home-building demand continues to increase.

Josh Wiener, the founder of home-improvement firm Silver Lining Inc, told Insider it’s been difficult to get projects approved due to the COVID-19 regulations in New York City.

Once a project starts it can get stuck midway through

Supply shortages have been unpredictable in recent months. Cunningham told Insider he’s had projects where a kitchen remodel has been held up by the availability of the dishwasher model or refrigerator. Contractors currently expect to wait an extra 3-4 weeks for appliances to be delivered due to shipping delays and the global computer chip shortage, Cunningham said.

There have been times when Sable Homes has been forced to pivot from one project to another, as contractors wait on vinyl siding or plumbing pipes. Bitely said the company tries to compensate by ordering products well ahead of schedule, but they never quite know what products will be in short supply.

“The biggest problem is the shortage is random so it’s very difficult to fix or nail down,” Bitely told Insider. “Because it’s impacting nearly every facet of the supply chain, it will be difficult to make it go away.”

GettyImages 1214261483

While kitchen appliances have been heavily impacted by the global semiconductor chip shortage, other products like paint and vinyl siding are also in short supply due to the Texas freeze. Though, Dietz says the skyrocketing lumber prices are one of the biggest hurdles home-building and improvement companies are struggling to overcome.

“Lumber is a big component of any home project,” Dietz said. “It’s adding about $36,000 to new single family homes and it’s driving remodeling prices higher.”

Home-improvement projects are sure to be more expensive

It’s difficult to predict how much a project will cost.

Cunningham told Insider that his company has an escalation clause in their contract that the material costs may be subject to change. Bitely said he sees prices fluctuate every few weeks.

“As a company, there’s nothing we can do but pass those prices through to the customer,” Bitely said. “We set up the expectation early on that prices are changing and the project may be subject to delays and for the most part customers are not deterred.”

lowe's remodeling
A Lowe’s employee stocks lumber inside the home improvement store in New York.

Other companies have been forced to eat the rising material costs without an escalation clause in their contracts. Wiener said his company has been forced to pay for 100% of costs that are outside of the initial budget. He said Silver Lining has been lucky in that as a bigger firm they have been able to overcome the cost hurdles, while smaller firms might be forced out of business.

Despite delays and rising costs, demand shows no signs of dampening

“Right now, most clients are still going through with buying because they’re desperate for house. They have no other choice,” Bitely said.

Home-building and improvement delays and price spikes are not expected to abate anytime soon. On Thursday, Kyle Little, chief operating officer of Sherwood Lumber, told CNBC he expects elevated lumber prices to continue into the “foreseeable future.”

“It’s really imperative that policymakers improve these supply chains,” Dietz told Insider. “Lumber affordability is key to housing affordability.”

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A bad hurricane season could be the next headache for businesses already facing a supply shortage

iota monday morn
Satellite imagery captures Hurricane Iota bearing down on Nicaragua as a Category 5 hurricane on November 16, 2020. NOAA/NASA

  • It will be another active year for hurricanes following 2020’s record-breaking season.
  • The storms could cause problems for already struggling supply chains like lumber, oil, and pork.
  • “It’s a significant risk that all businesses need to be thinking about right now,” said AccuWeather.
  • See more stories on Insider’s business page.

A bad Atlantic hurricane season may be the next disruption to the supply chain.

“It looks like another active year,” said AccuWeather Chief Meteorologist Jonathan Porter, “which is not good news.”

Items from lumber and housing supplies, to toilet paper and tampons, to gas and plastics, to pork and chicken, have been plagued by shortages caused by a sting of factors: Supply chains snarled in the coronavirus pandemic, backed-up ports, reverberations from the February Texas freeze, the Suez Canal blockage, worker scarcity, and the temporary shutdown of a vital oil pipeline, among other issues.

Though meteorologists aren’t predicting the Atlantic hurricane season, which runs from June through November, will be as record-breaking as 2020, they’re saying the number of named storms and hurricanes will be higher than in a normal year.

DTN, a Minnesota-based analytics firm, is predicting 20 named storms, compared to the annual average of 12. Of those, nine will be hurricanes, and four will be major hurricanes of category 3 or stronger. AccuWeather had similar predictions of 16 to 20 named storms, seven to 10 becoming hurricanes, and three to five to becoming major hurricanes.

The economic impact from last year’s hurricane season, which had six category 3 or higher storms, was about $60 to $65 billion in damage and losses, according to AccuWeather.

“The combination of another enhanced hurricane season and the threat of landfall across a big section of the East Coast of the US this year will be disruptive to the supply chain,” said Renny Vandewege, a leading weather expert at DTN.

Read more: Morgan Stanley says the stock market is flashing early warning signs of weakness as businesses face supply shortages. It recommends investors make these 4 trades to avoid the risks ahead.

Vandewege said the storms are more likely to favor the East Coast this year, compared to 2020, when the Gulf Coast felt a heavier impact.

The storms could “disrupt really anything that’s being imported in,” Vandewege said.

“We’re already having a months-long backup at the Port of Los Angeles, and then if we had also the same thing on the East Coast for an extended period of time, it could phenomenally exacerbate product shortages,” said Chris Wolfe, chief executive officer of logistics company PowerFleet.

Storms affect a state’s big industries, too. Along the Texas gulf coast, hurricanes can have an impact on the chemical and the oil and gas industries. A storm there could echo issues that arose from the Texas freeze in February and the six-day Colonial Pipeline shutdown that caused gas prices to surge and prompted some East Coast residents to panic-buy gas.

The forestry industry could be “deeply impacted” as well, Vandewege said. “There’s been shortage on building materials, and that could be enhanced even more if we’re seeing key manufacturing areas shut down around Louisiana and Alabama” because of a hurricane.

Pork, which is heavily produced in North Carolina and other southern states, has faced shortages in the past year, as well, thanks to the pandemic.

When hurricanes, like Florence in 2018, have struck the state in the past, thousands of hogs died. Other livestock and agriculture are also at risk when hurricanes hit.

“There’s huge pork production, chicken production, all the way through the South,” Wolfe said, so storms “could dirsupt food supplies.”

Porter from AccuWeather also noted that the West Coast could see another damaging wild fire season, and he said companies have to prepare ahead of time. “It’s a significant risk that all businesses need to be thinking about right now,” he said. “What’s their vulnerabilities and plan to mitigate.”

Climate change and extreme weather events topped the World Economic Forum’s list of biggest global risks in 2020. That was no surprise to Porter, who said, “people are getting negatively impacted almost on a daily basis by weather events. He said for businesses, the supply chain is a “major component” of that.

Read the original article on Business Insider

Your Memorial Day is about to get a lot more expensive. From hot dogs to fuel, here are some of the products in short supply.

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  • As the vaccination rate picks up, demand is outpacing the supplies of many key goods.
  • Americans will face several prices hikes and shortages this Memorial Day.
  • Insider rounded up all the products that may be difficult to find over the holiday weekend.
  • See more stories on Insider’s business page.

Everywhere you look, there seems to be a new shortage popping up in America’s currently very strange economy. From chicken to gas, it’s getting harder to come by items as supply-chain issues, outsized demand, and the climate crisis all converge to choke accessibility.

But as Americans learn to live in a new normal yet again – this time with vaccines, fewer masks, and slightly eased pandemic-era restrictions – demand for things like travel and hotels is on the rise. With a long weekend coming up, Americans are ready to get back into the world. But the economy may not be ready for them: Here are the shortages that could plague Memorial Day weekend.

Vacation homes

Vacation home

Vacation-home rentals in the US are at an all-time high this year.

More people are looking to travel as the vaccination rate increases. In the US, 65% of people plan to travel more this year than before the pandemic started and 82% of families have already made vacation plans, according to online rental hub Vrbo.

If you haven’t rented out a vacation home yet, it might be too late to find one this year: 85% of vacation rentals in Cape Cod, the Outer Banks, and along the Jersey shore, are booked through August, Vrbo said.

Prices for vacation homes are skyrocketing, CNBC reported last month. Rentals in premium locations are going for record sums. One house in the Hamptons rented for $2 million this summer.

 

Hotels and motels

hotel reception

It’s not just vacation and rental homes seeing a surge: Hotels and motels saw their costs increase by 8.8% in April, according to the Bureau of Labor Statistics.

CNBC reports that nightly prices are on the rise, and are likely only to increase as summer travel goes into full swing. In fact, prices in coveted areas, like beaches, have soared above pre-pandemic levels.

While some industries say they’re struggling to find workers and staff up, the leisure and hospitality sector actually saw notable gains in April’s jobs report. While the report came in far below expectations — with just 266,000 jobs added, instead of the expected 1 million — leisure and hospitality emerged the strongest.

The industry added 331,000 payrolls. While that’s a promising sign of recovery, some experts say even those additions aren’t coming fast enough.

 

 

Fuel

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Americans looking to hit the road for Memorial Day weekend will face soaring gas prices.

The price of fuel surged to a seven-year high on Wednesday. Fallout from a cyberattack on the nation’s largest fuel pipeline devastated the supply chain, pushing the average price in the US over $3 per gallon. The 5,500-mile oil pipeline reopened on Thursday, but Reuters reported it could take weeks for fuel supply to return to normal, after consumers rushed to stock up on gasoline over the week.

Prior to the cyberattack last weekend, prices were not expected to see another significant spike until after Memorial Day, when travel is expected to push demand even higher at the end of the month.

But, even before the pipeline was shut down, gas prices were skyrocketing as demand outstrips dwindling fuel supplies. In April, fuel prices leaped 9% in their largest one-month increase in nine years as shipping container shortages, port delays, and OPEC production cuts made the commodity increasingly valuable.

A new or used car

Car Dealership
New Chevys for sale fill the lot at Raymond Chevrolet in Antioch, Illinois, July 17, 2014.

If you wanted to buy a car for that summer road trip you’ve been planning since March 2020, you may find yourself up against some fierce competition — and ever-increasing prices.

New cars are in short supply due to an ongoing shortage of the computer chips that power everything from the Bluetooth in cars to iPads, and their scarcity has been felt all over the economy. Some car manufacturers had to halt production at the start of the year, leading to more elusive models and higher prices.

That’s trickled down into the used-car market. In April, used car prices jumped by 10%. Insider’s Ben Winck reported that that was the largest one-month increase since 1953, when data first started to get collected. In fact, that price jump accounted for around a third of April’s big 0.8% jump in inflation from the previous month.

Experts attribute the shortage to demand for vehicles, especially as new cars are harder to come by, and rental car services attempting to rebuild fleets; many sold off some of their cars at the onset of the pandemic. 

Rental cars are also in high demand. As Americans clamor to travel again, there’s a “perfect storm” brewing, Insider’s Brittany Chang reports.

In hot tourist destinations, prices are surging; Jonathan Weinberg, the founder and CEO of AutoSlash, told Chang that some rental cars in Hawaii are going for over $500 a day — a massive increase from the usual $50. And rental car companies are expecting strong demand over the summer for their reduced fleets, all while coming up against the computer chip shortage.

But vacation goers might still find it expensive and difficult to get around if they’re counting on rideshare drivers. Uber and Lyft have been trying to lure drivers back to work with new incentives, but there’s still a persistent driver shortage. That’s due to a variety of factors, as drivers worry about safety and find stability in enhanced stimulus benefits.

Airfare

woman flight airplane mask
A woman disembarks from an airplane.

If you’re planning on jetsetting over Memorial Day weekend, you may find the shockingly low flight prices of the pandemic have vanished.

In April, airline fares increased by 10.2%, according to the Bureau of Labor Statistics

That’s not to say there aren’t deals, as airlines unleashed a week of wild international flight deals in April; the risk with those, as Insider’s Tom Pallini reported, is that it’s unclear if those countries will be open to American visitors.

But, as the Washington Post reports, it could be a different story for domestic flights, especially over the summer. Rising demand and fares could be concentrated over the summer, as Americans race to take advantage of the weather and newly loosened pandemic restrictions.

Adit Damodaran, an economist at travel booking app Hopper, told Insider’s Jamie Ditaranto that demand is concentrated around late May and early June — and that prices may rise by 15%.

Bacon and hot dogs

hot dogs on grill

Memorial Day barbeques will be impacted by the supply snags.

Bacon and hot dogs may be difficult to find in grocery stores, due to a global pig shortage. The hog industry has faced several setbacks this past year. High instances of swine decimated hog populations this past winter and COVID-19 outbreaks in at least 167 meat-processing plants forcing almost 40 plants to close as of June 2020.

Demand will likely outstrip supply as people stock up on the meat for cookouts on Memorial Day weekend.

 

Fireworks

Fireworks
Illegal fireworks illuminate the sky over the Bedford-Stuyvesant neighborhood of the Brooklyn borough of New York City, New York, U.S., June 19, 2020. REUTERS/Lucas Jackson

It will be more expensive to celebrate the holiday with fireworks this year.

Superior Fireworks announced they were increasing their prices about 15% this year — the highest the company has ever had to hike prices in its 20-year history.

The company is one of many fireworks producers that have been forced to raise prices in order to compensate for higher shipping and production costs.

Chlorine

Lodge at Kukuiula
The property’s infinity pool.

Vacationers looking to relax in the pool during the holiday weekend may face difficulty finding clean pools.

Last month CNBC reported the US is facing the worst chlorine shortage in history. Prices for the chemical used to clean pools has nearly doubled this past year and is only expected to continue to rise with warm weather.

Pool owners can avoid the shortage by using saltwater pools instead, according to Insider’s Annabelle Williams.

Imported goods like wine and cheese

food membership
wine with cheese

Vacationers will pay top dollar for imported food.

Good from overseas, including seafood, cheese, and wine are facing months of shipping delays. Some grocery stores, including Costco have already reported shortage of imported food, while other companies have already begun to hike prices in response.

Last month, Coca-Cola and General Mills announced they were raising their prices.

Restaurant service

los angeles outdoor dining
A waitress takes customers’ orders in the outdoor seating area of a restaurant on January 28, 2021 in Los Angeles.

People looking to eat out over the holiday weekend may find difficulty getting service at local restaurants.

Major labor shortages have rocked the restaurant industry. After laying off millions of workers at the onset of the pandemic, many restaurants are struggling to bring workers back as they reopen.

Restaurant chains have rolled out new incentives to lure employees back, according to Insider’s Kate Taylor. But, many frontline workers are hesitant to return to work over concerns regarding COVID-19 safety, as well as childcare, Insider’s Ayelet Sheffey reported.

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The chip shortage that’s wreaking havoc on supplies of cars, computers, and more could last another 2 years, experts say

FILE PHOTO - A researcher plants a semiconductor on an interface board during a research work to design and develop a semiconductor product at Tsinghua Unigroup research centre in Beijing, China, February 29, 2016.  REUTERS/Kim Kyung-Hoon
A researcher plants a semiconductor on an interface board during a research work to design and develop a semiconductor product at Tsinghua Unigroup research centre in Beijing

  • Semiconductors are an increasingly important component of products from laptops to lightbulbs.
  • Surging demand and disrupted supply have led to a severe lack of chips for a variety of industries.
  • Industry leaders and analysts are forecasting at least another year of shortages.
  • See more stories on Insider’s business page.

Semiconductor chips are in almost everything these days.

As Glenn O’Donnell, a vice president at Forrester Research, put it, “if it has a plug or a battery, it is probably full of chips.”

The global chip shortage that is jamming up auto manufacturers is rippling across nearly every industry that makes or uses tech-enabled products.

In particular, analysts say the boom in cloud computing and cryptocurrency mining, as well as the embedding of smart features in everything from doorbells to dishwashers, has led to a gold rush in the sector.

Read more: Auto Chip Crisis Is Threatening Recovery From the Pandemic

But a combination of factors have pinched the supply as demand continues ramping up, leading to severe shortages that industry leaders and analysts say could drag out into 2023.

We are looking at couple of years… before we get enough incremental capacity online to alleviate all aspects of the chip shortage,” IBM President Jim Whitehurst told the BBC. His company licenses microprocessor technology to the world’s leading chip makers.

Last week, Reinhard Ploss, CEO of German chipmaker Infineon, told CNBC his industry has never seen conditions like these, but that two years to normal seemed “too long.”

Other firms have painted even rosier forecasts – Taiwan Semiconductor Manufacturing Company (TSMC), the largest chip maker, said it expects to catch up with auto industry demand next month, and Cisco CEO Chuck Robbins, told the BBC the shortage would wind down later this year.

Analysts, however, are skeptical.

“Because demand will remain high and supply will remain constrained, we expect this shortage to last through 2022 and into 2023,” O’Donnell wrote on a Forrester blog. “We see nothing but boom times ahead for chip demand.”

Plurimi Investment Managers CIO Patrick Armstrong told CNBC he expects another 18 months of shortfalls.

“It’s not just autos. It’s phones. It’s the internet of everything. There’s so many goods now that have many more chips than they ever did in the past,” he said. “They’re all internet enabled.”

New production is coming online, with a $20 billion spend from Intel and a $28 billion investment from TSMC, but that does little to solve the immediate challenge facing the market right now.

Nobody is literally filling trash bags or gas cans with semiconductors, but Credit Suisse’s director of global economies and strategy, Wenzhe Zhao, said last week that inventory hoarding along the production chain is making a tight supply situation even worse.

For now, Forrester’s O’Donnell recommends tech buyers be patient, pay more, pick an alternative product or service, or make do with older tools until things return to normal.

Read the original article on Business Insider