In the News: Jason Pattit on How Natural Disasters Impact Minnesota’s Agriculture and Medical Device Industries

Jason Pattit, professor of management at the University of St. Thomas Opus College of Business, recently spoke with WCCO-TV about how events like hurricanes disrupt supply chains and affect local businesses, highlighting the far-reaching consequences on food costs, medical supplies and restaurant sourcing.

From the story:

Host: What is the bigger picture in terms of economics, in terms of business, and, in the end, the cost to all of us of these huge natural disasters that are occurring more frequently?

Pattit: It’s very surprising when you look into the impact – how far-reaching it is and the number of industries that are touched by these types of natural disasters. It’s very surprising. In Minnesota, obviously, it’s important for us, with agriculture, and that seems obvious. But an industry that’s just as impacted by this is the medical device industry, which is huge here in Minnesota. You think, ‘OK, how is it that these disasters outside of our state are impacting us?’ Well, we have many of the headquarters for these large multinational medical device companies, and they have manufacturing facilities all over the world. When they’re impacted by these major events, it really hits their supply chains hard. It has an impact not only on the companies, but also on the patients who rely on devices and other peripherals from these companies. So, it’s really quite amazing to see the kind of spillover effect from these events.

Host: In terms of the agricultural impact, were you talking about both here in Minnesota, when we get these kinds of hail storms and events, and also nationally, how crops are being wiped out? That affects, obviously, the supply chain of food for all of us, and I suppose eventually the cost as well.

Pattit: Exactly. There’s certainly the local impact when we have those types of events happening right here in Minnesota. It certainly impacts more crops and the companies located locally – their ability to utilize their supply chain to supply purveyors throughout the country, whether it’s grocery stores or some of the big restaurant suppliers. But then, when we think about the impact of events like the current hurricanes and how that affects our restaurant businesses here in the Twin Cities, we have outstanding restaurants that rely on a lot of ingredients from outside of Minnesota. Those businesses really do have to think about how those changes – especially if they aren’t temporary and are potentially permanent – impact their menus and where they’re sourcing from.