Factory shutdowns in Asia have caused computer parts to be harder to find, and their prices to rise

Computers are complex machines- they usually require parts made and assembled from all over the globe. Supply chains are affected when factories close or assembly of key parts is delayed. The world is seeing an increase in prices in RAM as well as SSD, particularly due to Chinese factories shutting down due to COVID-19. Suppliers have already told their buyers that key computer components are in short supply and to expect additional price increases for all computer parts.

Demand surging due to increase in remote work

As millions of workers across the globe started to work remotely for the first time in 2020, demand for computer components for their home computers and laptops skyrocketed. Businesses were suddenly forced to equip a newly remote workforce, and many workers hurried to purchase computers (and secondary parts) to adjust to the new working-from-home lifestyle.

“We see an incredible 42 percent of the U.S. labor force now working from home full-time. About another 33 percent are not working – a testament to the savage impact of the lockdown recession. And the remaining 26 percent – mostly essential service workers – are working on their business premises. So, by sheer numbers, the U.S. is a working-from-home economy. Almost twice as many employees are working from home as at work.” says Stanford economist Nicholas Bloom.

With more and more businesses getting used to and shifting to full-time remote work for their employees, the demand for computer parts for remote and home work will continue to increase.

Students needing more tech

It’s not just office workers who needed more tech- the widespread closure of schools has also affected demand. Children needed their own PCs as schools closed and lessons went online. High schools and colleges across the country went virtual as well as students of all ages needed to buy or upgrade their computers and parts.

Demand also rising due to increases in home entertainment

More people staying at home = more time on their computers. Whether it be for gaming, watching movies or TV shows, studying, or video calling loved ones- people are using their computers now more than ever at home. This has naturally led to a massive increase in the demand for computer parts- memory/RAM, processor’s, hard drives, etc. People are buying computers at an unprecedented rate, even as the market fails to meet the demand for computer components.

As reported in the Wall Street Journal:

“Had the market not been hampered by component shortages, notebook shipments would have soared even higher during the third quarter as market appetite was yet unsatiated,” Jitesh Ubrani, IDC’s research manager for Mobile Device Trackers.


Panic buying

We saw it with toilet paper. We saw it with hand sanitizer. We saw it with all home consumer goods. COVID-19 induced people to panic buy and stock up as much as they can on whatever tech they could get their hands on. Computer components, particularly for gamers and businesses in the industry, were affected just as hard.

It’s simple: production shortages + panic buying = severe lack of computer parts available.

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