Coronavirus and technology supply chains: How to restart and rebuild

As COVID-19-related restrictions begin to lift in Asia, how can organizations resolve supply-chain issues at pace?

 
For the technology industry, the effects of the coronavirus (SARS-CoV-2), which causes COVID-19 disease, started to take hold in January when China—a critical link in the global technology chain—began reporting more cases. And while the country’s early lockdowns and quarantines are slowly beginning to lift, the pandemic’s international expansion is leading to new restrictions across the globe that are weighing on business activity. Consequently, the technology supply chain now faces a new set of challenges.

China itself poses several operational questions. Over the past few weeks, major progress in reducing labor constraints in China occurred (Exhibit 1). We estimate that by March 24, 2020, around 75 percent of the country’s workforce had returned to work. That is a major improvement over the situation in February 2020, when less than 20 percent of workers were back on the job. But many workers are new recruits who require training, which will likely take several more weeks. And Wuhan—the major manufacturing center where the outbreak began—remains far behind, with just around 24 percent of labor having returned to work.

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