CEA survey results – understanding the impact of Covid-19 on production and employment

Last week the CEA (Construction Equipment Association) conducted a “snapshot survey” of its members to establish how the current crisis is impacting on members’ activities. The survey asked about production and employment during the current COVID-19 pandemic.

The results of the survey revealed that 10% of respondents reported that their production had not yet been affected by the pandemic and it was ‘business as usual’, while the majority of 72% were working at reduced levels, and 18% had temporarily closed their businesses.

The percentages of office staffing levels were slightly different – where 14% of participants said that they were as they were before the crisis, while 80% of companies had a reduced level of staff and 6% reported that they had no staff working at all.

Companies were also asked at what levels their facilities were working compared with ‘normal’ – the overall percentage was 35% of normal production. Staffing levels were 52% compared to ‘normal’.

The poll also revealed that the percentage of the total workforce that has been furloughed and placed on the HMRC Job Retention Scheme was an average of 48% across all respondents.

On Monday of last week, more than 140,000 firms applied for the government’s Coronavirus Job Retention Scheme, which pays 80% of a worker’s salary up to a cap of £2,500 a month to stay at home.

43% of companies said they had claimed successfully for staff wages under the JRS scheme on the HMRC portal and 4% had tried unsuccessfully. 53% of companies said they had not claimed, but additional comments in the survey suggested some companies were ‘planning’ to make a claim, which would potentially increase the 43% to over 55%.

Since the crisis members of the CEA team have spoken to more than 150 of its members who serve a cross-section of industry sectors. Feedback from ‘niche’ market members, such as component manufacturers, indicates that sales for this sector are holding up with steady exports to the USA and China, however, air and sea freight is hard to source and is unreliable and subject to cancellations. The companies are also picking up unfulfilled UK orders from Italy, France, and China.

Component manufacturers are of the opinion that the crisis ‘should’ trigger a UK wide reshoring strategy and are in fact expecting a post-COVID-19 reshoring of the supply chain.

Reports from SMEs indicate that they appear to be better prepared to face business disruption and are more flexible and also carrying larger inventory, although not unexpected, they report that some are struggling from delayed customer payments.

Encouragingly, not all reports were negative – some of the members were pretty bullish about continuing business and orders still coming in.

The CEA is planning to continue circulating its COVID-19 bulletins to its members and also has a dedicated COVID-19 Portal on the CEA web site. The association is also in regular contact with government and is providing daily briefings for Ministers.

For further information and free access to the CEA COVID-19 portal please visit https://www.thecea.org.uk/covid-19/

Source: CEA Press