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Pingdemic overshadows 'freedom day' as worker shortages hobble recovery

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The masks are off, but supply chains are facing collapse as soaring infection rates mean millions of workers across the trade, tourism, hospitality and retail sectors have to self-isolate. 

21st Jul 2021
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The government’s decision to drop all remaining coronavirus restrictions in England on Monday was intended to boost businesses hamstrung due by social distancing rules.

But a growing number of companies, including pubs, railways, car factories and supermarkets, said a deluge of notifications by the Covid-19 tracing app has led to widespread staff shortages, putting their operations at risk.

Alerts, or “pings”, issued by the official NHS app inform anyone identified as a contact of someone with coronavirus to self-isolate for 10 days.

And as cases of Covid-19 topped 50,000 on some days last week, the resulting “pindgemic” upended supply chains across multiple sector and forced many companies to close stores, warehouses and offices.

The government pressed ahead with 'freedom day' to help deliver a windfall for the economy, but with infection rates at their highest since January, business leaders have warned the problem “is only going to grow”.

Steve Rowe, chief executive of Marks and Spencer, told The Times it was already a “major issue across every industry at the moment”.

“Our Covid cases are roughly doubling every week and the pinging level is about three to one of Covid cases, so we're seeing that growing exponentially,” he said. “If there’s shortages we'll have to manage it by changing hours of stores.”

Union Unite’s assistant general secretary Steve Turner said “factories are on the verge of shutting and that at some sites, hundreds of staff are off work”.

If a solution isn’t found, people will start deleting the app “en-masse to avoid isolation notices”, with potentially negative public health consequences, Turner said.

Unite members at Nissan and other manufacturing, health, hospitality, retail and public transport businesses “live in fear of being pinged by the app” as it would mean they would have to isolate and be unable to work, Turned added.

Closing time

Major pub chain Greene King said it has had to temporarily close 33 establishments in the last week because of the number of employees required to self-isolate.

Frozen food specialist store Iceland also had to close some stores for the first time since the pandemic began because it does not have enough people to staff them, managing director Richard Walker said.

In robust terms, he said the re-opening effort, with self-isolation rules still in place a month after “Freedom Day” was a “shitshow” for business.

Britain’s largest supermarket Tesco was forced to drop some online deliveries at the weekend due to a shortage of truck drivers, despite telling shareholders last month that it had plans in place to address any shortfall.

“We are already seeing a serious impact on retail operations as a result of staff having to self-isolate and this will only get worse right across the economy, as cases are already rising fast and the final restrictions are eased,” said Helen Dickinson, the CEO of the British Retail Consortium, in a statement.

"Given the effectiveness of the current vaccine roll-out programme, the government should pull forward the 16 August date so that people who are fully vaccinated or have a negative test are not forced to needlessly quarantine when they are contacted by track and trace," she added.

In the hospitality sector, three major issues are lingering, said Rajeev Shaunak, partner at MHA; the end of government support, changing customer behaviour, and the burning issue of labour shortages.

“Even where there is demand, a shortage of staff following Brexit is a concern in an industry that already struggles to recruit good people,” he said. “A lack of staff will have a big impact on the customer experience traditional brick-and-mortar establishments are so dependent on.”

He said companies who do navigate the current situation face longer-term challenges.

“Unfortunately, the initial bounce back from Covid-19 may simply be a temporary stay of execution for the hospitality sector,” he said.

Lean on technology

For accountants, predicting unpredictability has become a necessity over the last 18 months, said Chris Downing, a director at Sage.

“Staff shortages and self-isolation, amidst a growing ‘Pingdemic’, can create immediate issues in the retail and hospitality sector, especially for businesses that don’t have remote working capabilities,” he said. “With a better overview of HR data and people costs, financial executives can gain a better picture of cashflow and resource capacity.”

He said the pandemic has “fundamentally exposed” weaknesses in processes and operations. “But, by knowing where weak spots are, and if there are glaring issues with staffing or compensation needed for shortages, financial executives can begin to implement measures to protect the businesses and workforce from additional stress,” he said.

Flexibility will be key, added James Wright-Anderson, of James Wright & Co Chartered Accountants. “If anything has been learned in the last eighteen months, it is to expect the unexpected,” he said. We recommend adopting a flexible planning process. Rather than fixing your financial plans, review and revive them on a regular basis.”

Test and release?

One change the government could consider would be a “test and release” system whereby individuals who have been asked to self-isolate can return to work if they subsequently have two negative PCR tests over five days, said Ben Willmott, head of public policy at the Chartered Institute of Personnel and Development (CIPD).

Nearly three in five (57%) HR professionals said organisations faced worker shortages in the last month because of employees self-isolating after being contacted by the NHS app, Willmott said.

“This problem is only going to grow as the economy continues to open up after restrictions end, with the risk that disruption to organisations’ services and operations starts to have severe consequences for the public and business”, he said.

In the meantime, he said firms should be flexible by freeing up staff from less business-critical areas and using temporary workers where possible. He also suggested companies continue to implement Covid-secure workplace policies, including the use of screens or barriers and mask wearing, despite the relaxation of official guidance.

“Employers should continue to encourage people to work from home where possible, to reduce the number of contacts their staff have in the workplace or when travelling to work”, he said. “For roles where employees need to be in the workplace, organisations should continue using measures to reduce staff contact, such as staggered start and finish times.”

Replies (1)

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ghm
By TaxTeddy
22nd Jul 2021 07:31

Hang on.

Unintended consequences caused by ill-conceived technology blindly adopted by a government department? Where have I heard that before?

Oh yes, MTD.

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