China is bracing as its factories plan to reopen on Monday morning, despite the growing coronavirus crisis that is gripping the nation, according to CNBC. Workers had previously remained at home due to the Lunar New Year holiday, and a majority of factories extended their vacations due to the fears about the disease.
However, many factories — especially those in the tech industries — are reaching “crisis mode” and can no longer allow their businesses to remain idle. Though many officials have worries that a return to work will exponentially increase the number of individuals infected with the coronavirus, which is already spreading at an alarming rate, others argue that business owners have little choice.
Andre Neumann-Loreck, founder a Silicon Valley firm that specializes in advising start-ups about sourcing hardware and building products in Asia, confessed that many of his clients had expressed their worries about how the coronavirus crisis would impact their businesses.
For example, Facebook recently announced that it might not make its Oculus Quest virtual reality headsets schedule due to how the coronavirus had impacted production.
Neumann-Loreck added that some companies had even been making plans to move their supply lines to other countries.
“Companies that are building hardware or physical products are in crisis mode now, and that’s true whether they’re getting finished goods built in China or relying on China for components and sub-assemblies,” Neumann-Loreck explained.
Factories had already been closed a week longer than expected in an attempt to stem the rise of infections in the country. However, the coronavirus has nevertheless swept through the nation at an alarming rate, with the state claiming that 40,000 people had been infected and around 900 had died.
Sherina Kamal, a risk analyst at Resilience 360, a logistics risk-management company backed by DHL, said that the disruption to the supply-chain had already forced a global effect on the economy.
“The ripple effect coming from one region in China is completely unprecedented,” Kamal said. “We’ve never seen anything like this.”
Other experts worry that workers might choose to stay home instead of going to work. Those that would be particularly susceptible are hypothesized to be rural workers who travel to urban areas for employment.
“There are many temporary workers that go to the city to earn a living, then they go back and reunite with their families,” said Jayashankar Swaminathan, professor of global operations at UNC Kenan-Flagler Business School.
“But in this situation, they may have second thoughts about whether to go back. That would be a major problem for companies if there is a shortage of manpower,” he explained.
Meanwhile, the Chinese economy is not the only aspect of the country that is struggling. The government is under intense pressure after the doctor who sounded the alarm on the virus passed away, and a citizen journalist documenting the epidemic went missing, as was previously reported by The Inquisitr.