Grocery shortages flare again
Omicron, weather adding to supply chain, labor issues plaguing retailers nationwide
Shortages at U.S. grocery stores have grown more acute in recent weeks as new problems — like the fast-spreading omicron variant and severe weather — have piled on to the supply chain struggles and labor shortages that have plagued retailers since the coronavirus pandemic began.
The shortages are impacting produce and meat as well as packaged goods such as cereal. And they’re being reported nationwide. U.S. groceries typically have 5% to 10% of their items out of stock at any given time; right now, that unavailability rate is hovering around 15%, according to Consumer Brands Association President and CEO Geoff Freeman.
Part of the scarcity consumers are seeing on store shelves is due to pandemic trends that never abated — and are exacerbated by omicron. Americans are eating at home more than they used to, especially since offices and some schools remain closed.
The average U.S. household spent $144 per week at the grocery last year, according to FMI, a trade organization for groceries and food producers. That was down from $161 in 2020, but well above the $113.50 that households spent in 2019.
A deficit of truck drivers that started building before the pandemic also remains a problem. The American Trucking Associations said in October that the U.S. was short an estimated 80,000 drivers.
And shipping remains delayed, impacting everything from imported foods to packaging that is printed overseas.
Retailers and food producers have been adjusting to those realities since early 2020, when panic buying at the start of the pandemic sent the industry into a tailspin.
“All of the players in the supply chain ecosystem have gotten to a point where they have that playbook and they’re able to navigate that baseline level of challenges,” said Jessica Dankert, vice president of supply chain at the Retail Industry Leaders Association, a trade group.
Generally, the system works. But Dankert says that bare shelves have been a phenomenon over the last 20 months. It’s just that additional complications have stacked up on that baseline at the moment, she said.
The omicron variant has taken a toll on food production lines.
Sean Connolly, the president and CEO of Conagra Brands, which makes Birds Eye frozen vegetables, Slim Jim meat snacks and other products, told investors last week that supplies from the company’s U.S. plants will be constrained for at least the next month due to omicron-related absences.
Worker illness is also impacting grocery stores.
Stew Leonard Jr. is president and CEO of Stew Leonard’s, a supermarket chain that operates stores in Connecticut, New York and New Jersey. Last week, 8% of his workers — around 200 people — were either out sick or in quarantine. Usually, the level of absenteeism is 2%.
Experts are divided on how long grocery shopping may feel like a scavenger hunt.
Dankert thinks the country will soon settle back to more normal patterns, albeit with continuing supply chain headaches and labor shortages.
But Freeman says omicron-related disruptions could expand as the variant grips the Midwest, where many big packaged food companies like Kellogg Co. and General Mills Inc. have operations.