Results reveal how COVID-19 has impacted on production and employment in the construction equipment sector
LAST week the CEA (Construction Equipment Association) conducted a ‘snapshot survey’ to establish how the current crisis is impacting on its members’ activities. The survey asked about production and employment during the current COVID-19 pandemic.
Ten per cent of respondents reported that their production had not yet been affected by the pandemic and it was ‘business as usual’, whilst the majority (72%) were working at reduced levels and 18% had temporarily closed their businesses.
The percentages of office staffing levels were slightly different – 14% of participants said that they were as they were before the crisis, whilst 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, whilst staffing levels were 52% compared with the norm.
The poll also revealed that the percentage of the total workforce that has been furloughed and placed on the HMRC Job Retention Scheme (JRS) was an average of 48% across all respondents.
Forty-three per cent of companies said they had claimed successfully for staff wages under the JRS scheme on the HMRC portal and 4% had tried unsuccessfully, whilst 53% of companies said they had not claimed. However, additional comments in the survey suggested some companies were planning to make a claim, which would potentially increase the 43% to more than 55%.
Since the crisis began, members of the CEA team have also spoken to more than 150 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 US and China, although air and sea freight is hard to source, unreliable and subject to cancellations. These 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 indeed 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, are more flexible and are also carrying larger inventory, although not unexpectedly, some are suffering from delayed customer payments.
Encouragingly, the CEA said not all reports were negative, with some members remaining pretty bullish about continuing business and orders still coming in.