Coronavirus: Shanghai’s ‘white-listed’ manufacturers operate at a fraction of capacity as supply chain disruptions hobble recovery

The dire scenario has exacerbated worries about the potential severity of an economic slowdown and the scale of job losses that may result

Two officials with key manufacturers on the Shanghai government’s so-called white list said they would have to slash jobs even after the lockdown is lifted

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Many of the manufacturers given permission to resume operations during Shanghai’s lockdown are working at a fraction of their full capacity. Photo: Xinhua

Published: 7:26pm, 11 May 2022Updated: 1:10pm, 31 May 2022

Many of the companies given permission to resume operations during Shanghai’s lockdown are working at a fraction of their full capacity as broken supply chains and disrupted logistics continue to hobble a recovery of the business sector.

The dire scenario, revealed by company executives and business surveys, has exacerbated worries about the potential severity of an economic slowdown and the scale of job losses that may result.

Two company officials with key manufacturers on the Shanghai government’s so-called white list said they would have to slash jobs even after the lockdown is lifted.

The damage to their business operations caused by the lockdown has been too savage to absorb, they said, resulting in redundant capacity at the manufacturing plants.

Shanghai, the epicentre of the mainland’s latest Covid-19 outbreak, went into a citywide lockdown on April 1, and most manufacturers halted production.

Since mid-April, the municipality has allowed about 2,000 key manufacturers to resume production under a so-called “closed loop” system – workers essentially sleeping on site to avoid contact with outsiders.

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