Mathew Fell, chief policy director at the CBI employers’ group, said staff shortages due to Covid was one of the issues businesses were facing in the New Year.
“This is clearly set to be one of the issues facing businesses at the start of this New Year. We were hearing just before the Christmas break retailers telling us that Covid-related absences were up about 50% in a week.” He said.
The expert insisted it was key for the government to fix supply problems with Covid testing kits.
He told the BBC: “Testing is really key for confidence and making sure we have that as ingrained behaviour.”
It comes as ministers have been ordered by the Prime Minister to plan for up to one-quarter of public sector workforces to be off sick.
The Cabinet Office is leading contingency planning for mass staff absences, with public sector bosses being asked to test plans against a worst-case scenario of 25 per cent staff shortages as they try to minimise disruption from record spikes in infection due to the Omicron variant.
The Government is set to review Plan B measures on Wednesday but while it is thought they will be kept in place, no fresh restrictions are expect either.
Boss of food importer and retailer All Greens David Josephs said his business was forced to temporarily shut outlets and redeploy remaining staff while the chief executive of the Fullers pub chain said hundreds of staff remain off.
Mr Josephs, which sells fruit and vegetables to businesses such as restaurants, told the broadcaster prior to Christmas 15 per cent of his workforce was self-isolating or ill.
“We have had to re-deploy staff from stores into other stores to keep them moving,” he said.
No stores have yet had to close but “it’s possible that we would have to” if absences rise, he added.
He said his industry had ramped up testing but Mr Josephs was “not convinced” it is the answer.
Meanwhile, chief executive of Fullers Simon Emeny said the situation was starting to ease.
The company focuses on London but has 420 pubs and hotels across the country.
Out of 4,000 staff, there were 450 off sick or isolating in the lead up to Christmas.
Now the situation has been “improving” with staff illness and isolating down to around 250, he said.
Ministers have been tasked with developing “robust contingency plans” for workplace absences, led by Cabinet Office minister Steve Barclay who said he has been chairing regular meetings over the Christmas period to closely monitor the situation.
Public sector leaders have been asked to prepare for “worst case scenarios” of 10 per cent, 20 per cent and 25 per cent absence rates, the Cabinet Office said.
Rail services, the NHS and schools have seen widespread disruption due to staff shortages.