Manufacturers react to third national lockdown

Posted on 6 Jan 2021 by Tom Lane

Following on from Prime Minister Boris Johnsons Monday night lockdown announcement the PM told Downing Street news conference on Tuesday, he had "no choice" but to impose the new measures.

With the number of patients in hospitals 40% higher than in the first peak and figures from the Office for National Statistics suggesting more than one million people in England had Covid between 27 December and 2 January. All of the UK is now under strict virus curbs, with Wales, Northern Ireland and most of Scotland also in lockdown.

The measures, which include a stay-at-home order and the closure of schools to most pupils, were announced by the prime minister on Monday. From January 5th, people in England will only be allowed to leave their homes for specific reasons, including going to work if it has to be done on site. This includes the manufacturing and construction industries.

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Tony Hague, CEO of PP Control & Automation

Manufacturers reacted to the news of the third lockdown with some concern, Tony Hague, CEO of PP Control & Automation, commented: “My only concern is that if demand dips in certain sectors, some companies may take the decision – based on costs – that it is more effective to furlough staff and close the doors rather than look to operate at a reduced capacity.”

He continued “”Like the last lockdown, many manufacturers will remain open and, in our specific case, we are providing critical outsourcing, assembly and manufacturing services for key clients involved markets such as medical, food processing and packaging, and specific projects in relation to Covid-19.

“Now, once again, is the time for UK manufacturers to be bold, brave and innovative and seize the opportunities, however challenging the landscape may be” he concluded.

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Peter Davies, Chief Executive at James Lister & Sons, one of the UK’s longest established providers of engineering services and supplies, said: “I don’t think it will change any trading aspects, so long as the overall economy doesn’t dip again too significantly.

“On the flip side, closing the schools will, in my opinion, have a positive impact on reducing the spread of the virus. Whilst it may cause some issues with staff who have childcare responsibilities, I believe it is definitely the right thing to do.

“In fact, we have been ultra-cautious so far. Every time an employee has had a child sent home because there has been a positive case in their school class/year, wherever possible we have sent them home as well. In some cases, they have been able to partly work, in others we have just lost that productive capacity.”

Tony Danker, CEO, Be the Business
Tony Danker, CBI Director-General

Trade bodies reacted to the news on behalf of industry, with the CBI’s director-general, Tony Danker, saying: “It is absolutely essential that we all put the health of our citizens first, and businesses will continue to step up in the national interest to support the NHS, employees and customers in the weeks ahead.

“In tandem we need to acknowledge that the economic impact of these new restrictions is significant.

“There are now a number of imperatives for government to support business.

“First, ensuring firms have the cashflow to make it through. Extending existing support has helped, but a broader range of measures will need to tackle this further hit to revenues.

“Second, the government must review and plug any coverage gaps from existing support that are now further exposed, for example in supply chains.

“And third, firms must have a clear line of sight and assurance that support will be there for as long as restrictions are in place so that they can stay the course rather than act precipitously.

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Stephen Phipson, Chief Executive of Make UK

Stephen Phipson, Chief Executive of Make UK, added: “In the face of a renewed national crisis the Prime Minister is right to take these vital measures. This fight is likely to occupy much of the coming year and, just as it has done since the start of the crisis, industry has supported the national effort and will continue to do so.

“In return, it is now critical Government revisits the business support packages. Whilst measures such as the furlough scheme are very welcome, businesses are taking on substantial debt, deferring tax bills, postponing mortgage payments and facing empty order books; this cannot continue indefinitely. In strategic sectors like aviation and automotive tonight’s announcement will further damage already fragile demand.

“The Government must now bring forward a comprehensive plan for the next six months that provides certainty, stability and confidence including targeted support for critical sectors. We must ensure that our great manufacturers can survive the coming challenges and be in a position to help drive the recovery when it comes.”