UK businesses are struggling with staff absences of about double their normal level as the Omicron coronavirus variant sweeps across the UK – but surveys suggest the disruption is more likely to increase costs than stop production.
The CBI business group said its members report staff absenteeism rates averaging 10 to 15 percent across the country, well above the 5 to 6 percent typically for January, with higher levels in some parts of hospitality and retail, and in virus hotspots where the most occurred.
But while illness has put acute pressure on parts of the public sector – particularly hospitals and schools – the CBI said most larger companies would be able to deal with it by hiring temporary workers, postponing non-essential work and using to meet lower staff. levels – provided the number of self-insulating workers has not risen to a tipping point.
“If that 10-15 percent hits 20 percent, it’s when you’ll see businesses temporarily close, especially small and medium-sized businesses,” added Liz Crowhurst, director of the CBI’s policy unit, adding that recruitment agencies “see everything”. destroy previous records ”in demand for temps.
“Businesses are under pressure, but they do not run the risk of stopping production,” said Neil Carberry, CEO of the Recruitment and Employment Confederation.
However, this was largely because Omicron hit just as the pre-Christmas surge in demand for staff in the logistics sector subsided, he added, and simply meant that the recruitment problems many employers were already facing in the autumn did not did not worsen.
Even in November, four out of five businesses struggled to recruit, according to a survey published by the British Chambers of Commerce on Thursday. The REC’s quarterly survey of recruiters, which was also published on Thursday, suggested that vacancies continue to increase in the second half of December and increase the scarcity of candidates – albeit at the slowest pace since April. Meanwhile, the highest percentage of respondents on record said initial pay had risen.
The high agency costs that many companies are now incurring to arrange cover for self-isolating staff can contribute to existing wage pressures that fuel inflation, especially in sectors such as food manufacturing and warehouses that are already facing greater recruitment challenges.
Clare Bottle, chief executive of the UK Warehousing Association, said some operators reported that more than 30 per cent of their staff were ill in the first week after the holidays – and several tightened their sick pay policies as a result and only paid the statutory minimum.
“It is not disastrous. It’s manageable, ”said Jon Parish, commercial director at Miniclipper, a Bedfordshire-based logistics company, about Omicron’s impact.
But when staff called in sick, it was now sometimes impossible to get agency coverage at any cost, he said, adding that the company had already increased employees’ salaries by 7 percent over the past year, while passing on costs to clients.
Andy Lawrence, managing director of Maxim Logistics, a Midlands-based company that supplies mainly to food manufacturers, said Omicron had made it more difficult to manage staff absenteeism, especially given the longer self-isolation requirement for those not vaccinated.
The company was able to “juggle people around”, he added, but it saw more and more customers cancel orders at short notice because they could not perform shifts.