Industry calls for end to isolation for fully vaccinated as production slows

Make UK's survey of 436 companies revealed that two-thirds of responding companies backed the call for free Covid-19 tests for workers and provision of statutory sick pay, in tandem with an end to isolation for fully vaccinated individuals. The follows a marked slowdown in production at many manufacturing facilities impacted by protracted staff absences. With an increasing number of staff having to isolate, 13 per cent of companies said that some production has already stopped.

The survey, carried out on July 21, also showed that the majority of companies are continuing to prioritise the safety of their staff, with two-thirds (67 per cent) saying they had not removed any pandemic-related restrictions and would continue to uphold these safety measures in future. Around one-fifth of companies (19 per cent) have removed some restrictions, while just two per cent have removed all.

Other findings from the survey include:

• 97 per cent of companies back free lateral tests for employers, while a similar number say statutory sick pay should be available for employees isolating from day one.
• 77 per cent of companies have been impacted by track and trace, with the same number saying this has increased over the last two weeks.
• 66 per cent of companies support bringing forward the August 16 date for an end to self-isolation for those fully vaccinated, in light of the evidence of the impact of ‘pinging’ on the sector.
• 13 per cent said that some production has already had to stop.
• Almost a quarter said that up to 10 per cent of staff are isolating, with almost one in 10 saying that up to 25 per cent of staff are affected.

Stephen Phipson, chief executive, Make UK, said: “While we remain in a public health emergency the rules are clear in that anyone who is pinged should isolate. As such, employers should continue to act responsibly as they have since the start of the crisis and encourage their employees to follow the rules as they stand.”

“However, the impact on manufacturing continues to rapidly increase and there remains an inconsistency of Government policy that allows non-vaccinated people in nightclubs while those who have had both jabs are asked to isolate. We would urge Government to address this by bringing forward the planned August date in order to keep the economy open.”

Earlier this week, Make UK released its analysis of annual manufacturing performance, which showed the negative impact of Brexit uncertainty on trade with Europe even before the UK officially left the EU. Compiled by Make UK and business advisory firm BDO LLP, the 'Annual Regional Outlook' report showed that in 2020, five English regions together with Wales recorded a fall in their percentage of exports to the EU. In two regions the share stayed the same and only the West Midlands and Scotland saw exports to the EU increase slightly.

Whilst acknowledging the trade picture with the EU has improved recently for the UK, the most recent quarterly trade data shows exports to the EU in Q1 2021 were still 27 per cent below Q1 2019. This backs Make UK’s anecdotal evidence that many companies were already choosing either not to supply the EU or that EU customers are turning away from UK-based companies.

The report states that to help smooth trading with the EU, Make UK manufacturers need the UK government to work with the EU to ensure greater cooperation on customs procedures, creating systems for single digital submission and enhanced trusted trader schemes. This will become increasingly important when the UK import controls are introduced across Great Britain at the beginning of 2022.

Make UK added that manufacturers still need support from qualified and experienced customs experts, which has been a challenge to find for the sector. The introduction of new customs procedures with the EU, in addition to the pressures on the logistics sector, has created a challenging start to the year and drop in exports across many regions.

The report reveals that in 2020:

• Five English regions and Wales saw their dependence on EU for exports fall.
• Only the West Midlands and Scotland saw exports to the EU increase.
• The pandemic wiped approximately £18bn off the value of UK manufacturing.
• The Midlands and North West regions saw the least damage from Covid.
• Scotland was the UK’s most productive manufacturing area.

Referring to this report, Phipson said: “It’s clear that even before our final departure from the EU that political uncertainty was hitting exports to the bloc. While opportunities are opening up elsewhere, the EU will remain our biggest trading partner through sheer fact of geography.”

“As such, with major changes coming down the track, especially the imposition of import controls, it’s vital that government works with business and the EU to smooth out critical issues such as customs procedures. Otherwise there is a risk that the drop in exports to the bloc we have seen over the last couple of years will become structural and permanent.”

The analysis of manufacturing performance from the start of Q3 2020 highlights the brutal impact of the pandemic on the sector, with approximately £18bn output in value lost between 2019 and 2020.

However, as a result of the surge in growth, Make UK has upgraded its growth forecast for this year for manufacturing from +3.9 per cent to +7.8 per cent, meaning that assuming there are no further setbacks industry should have recovered all lost output by the end of 2022, six to nine months earlier than expected.

According to the report, which studied the last four quarters of manufacturing performance to June 2021, all UK regions were hit hard by Covid-19. The last year saw record lows in terms of percentage balances in orders, output, investment and recruitment as the impact of the pandemic took hold, but also record highs as manufacturers accelerated their recovery in the first half of 2021.

The perception amongst those surveyed yesterday about mandated employee isolation is that this recovery is being hampered by the inflexible rules, which are having the knock-on effect of reducing manufacturing output.