MNI DATA REACT: ISM: 75% of US Businesses See Virus Disruption

By Brooke Migdon

     WASHINGTON (MNI) - Three-quarters of all U.S. businesses are being hurt by

the coronavirus' impact on global supply chains and transport restrictions,

according to a special report released Wednesday by the Institute for Supply

Management.

     "Companies are faced with a lengthy recovery to normal operations in the

wake of the virus outbreak," ISM CEO Thomas Derry said in a statement. "For a

majority of U.S. businesses, lead times have doubled, and that shortage is

compounded by the shortage of air and ocean freight options to move product to

the United States -- even if they can get orders filled."

     Nearly 60% of companies noted longer lead times for China-sourced

components and average lead times more than doubled compared to the last few

months of 2019. The report gathered data from more than 600 manufacturers and

service-sector businesses between Feb. 22 and March 5.

     Positive Covid-19 cases in the U.S. spiked during the latter half of

February and health officials have stepped up warnings against large public

gatherings. Confirmed U.S. cases topped 1,000 as of Wednesday morning according

to Johns Hopkins University, leading to 29 virus-related deaths.

     More than 44% of U.S. companies do not currently have a plan in place to

address supply disruption from China, according to the report, and of that

statistic, 23% reported experiencing current delays.

     Organizations that had taken precautions to diversify their supplier base

after experiencing impacts from retaliatory tariffs from China are potentially

better equipped to address the effects of Covid-19 on their supply chains, Derry

said.

     The ISM will release a second report, tentatively scheduled for two weeks

from Wednesday, as it monitors the virus' evolving impact.

--MNI Washington Bureau; +1 202 371 2121; email: brooke.migdon@marketnews.com

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