Of all businesses that reported changes to supply chains because of the end of the EU transition period, 58% reported using more UK suppliers (Figure 3). Final weighted results, Wave 50 of the Office for National Statistics' (ONS') Business Insights and Conditions Survey (BICS).ĭownload this chart Figure 2: 1 in 20 currently trading businesses reported changes to their supply chains because of the end of the EU transition period Image.These bottlenecks have encouraged some businesses to rethink their supply chains. Both the coronavirus (COVID-19) pandemic and EU exit may have contributed to these supply chain blockages by further limiting the mobility of labour. Businesses in the manufacturing sector that responded to the survey commented that they are holding higher stock levels, which are likely to mitigate this issue. The businesses which have made changes to their supply chains in the manufacturing industry may be associated with the lack of material and equipment limiting production, as highlighted by the semi-conductor shortage. As Figure 2 shows, the highest proportion which have made changes to their supply chains are businesses within the wholesale and retail trade (9%) and manufacturing (10%) industries. The extent of changes varied by industry. These are not directly comparable with the weighted estimates as they are solely based on responding businesses in Wave 50 and not reflective of all UK businesses. This figure was higher than Scotland (9%), England (8%) and Wales (7%). Unweighted regional estimates published in the Business Insights and Conditions Survey (BICS) show around 13% of Northern Ireland businesses reported making supply changes. Excluding small firms (of zero to nine employees), around 8% of businesses said they had made changes. Rows might not sum to 100% because of rounding.ĭownload this chart Figure 1: Manufacturing and wholesale and retail trade industries reported significant global supply chain disruption over the last month Imageġ in 20 (5%) UK businesses that are currently trading reported they had made changes to their supply chains because of the end of the EU transition period.

“Mining and quarrying” and “Water supply, sewerage, waste management and remediation activities” have been removed for disclosure purposes, but are included in 'All businesses'.

Final weighted results, Wave 49 of the Office for National Statistics' (ONS') Business Insights and Conditions Survey (BICS).

These are only provisional findings and extra caution should be taken when interpreting these results because of the small sample size. It looks at whether businesses have changed suppliers in response to the coronavirus pandemic and/or EU exit and, if so, the ways in which businesses have changed suppliers as well as the extent to which any changes reported might be temporary or permanent. This article explores some of the initial evidence from the UK's Business Insights and Conditions Survey (BICS). It is challenging to accurately measure to what extent business supply chains have been affected so far and, if so, whether they are likely to be permanent. In this way, the UK may be more resilient to global supply chain disruption than other economies. The TiVA estimates also highlight the UK's relative lack of dependence on imported intermediate inputs for production of outputs, which is partially explained by the UK's service-based economy. This highlights a high degree of integration of UK exporters in downstream supply chains, demonstrating the scope for these shocks to have an impact on the UK's international supply chains.

For example, the latest Organisation for Economic Co-operation and Development (OECD) Trade in Value Added (TiVA) estimates show the UK has a prominent role as a supplier of inputs to the exports of other countries, particularly to the EU, US, Singapore, and China. These disruptions not only have the potential to affect final demand but also intermediate demand those goods and services that are inputs into production processes, which are traded by the UK. The Global Supply Chain Pressure Index (GSCPI) indicates that global supply chain pressures are at historically high levels, although there are signs these may have peaked and started to moderate a little. There is anecdotal evidence of labour and product shortages, reflecting shocks to the supply capacity of businesses and/or the inability to respond as quickly to the changes in demand for goods and services. Recent analysis by the Office for National Statistics (ONS) demonstrates the notable impact of these events on trade trends. The coronavirus (COVID-19) pandemic and the end of the EU transition period have had some impact on the UK's international trade flows, as well as causing disruption to global supply chains.

Supply chain issues 2021