America Facing Warehouse Shortage: How That Impacts Our Everyday Life

by Clayton Edwards

America’s retailers have faced a laundry list of supply chain issues. One of the biggest issues they’re currently facing is a shortage of warehouse space. Now, retailers and real estate developers are doing all the can to fight that shortage, but at what cost?

You can trace the current warehouse shortage in America back to the coronavirus pandemic. In 2020, as more Americans looked for ways to shop from home, e-commerce boomed. In order to meet consumer demands, retailers beefed up their online sales. This meant renting more warehouse space. According to a CNBC report, e-commerce takes up three times as much space as a brick-and-mortar retail operation.

Retailers, like Amazon, who already had massive e-commerce clientele had to expand. Those retailers started grabbing space wherever they could find it. This allowed them to have goods closer to their customers in order to shorten delivery times. In short, it made shopping online easier but it also contributed to the current warehouse shortage.

How America’s Warehouse Shortage Affects Us

First and foremost, we’ll probably start seeing more price hikes on a variety of items. The shortage of warehouse space means that any space now comes at a premium. If retailers are spending more to store and ship their goods, consumers will feel the pinch at the checkout.

Additionally, real estate developers are working to combat the warehouse shortage. This means they’re buying up land and building new storage and shipping facilities. Right now, warehouses are going up all over the country. Last year, companies built a shocking 190 million square feet of warehouse space to fight the shortage. Retailers leased nearly half of that space before the buildings were completed.

 For communities, this could mean more jobs and a shift in the local economy.  On the other hand, it could mean giant square buildings where trees once stood. In Pennsylvania, it means a pair of warehouses where Dutch Springs, an aqua park and scuba diving center, once stood. For years, Dutch Springs was an important part of the diving community in the area. First responders trained there. Families came to enjoy outdoor fun. Now, it will be a hub of e-commerce.

Stuart Schooley, owner of Dutch Springs told CNBC about his reason for selling his land. “We realized we couldn’t stop it. It just started a progression of one warehouse after another. We were the last property.” Now, Schooley and his wife plan to retire on the money they make from the sale.

In short, the current warehouse shortage is causing higher prices and headaches for retailers. However, the industry’s response to the shortage is the real double-edged sword. It’ll bring new jobs and faster shipping. But, we’ll get those at the cost of the destruction of the natural landscape and the downfall of cherished community spaces.