Wellington is among places best positioned to defy an Omicron surge but downtown businesses could atrophy as workers stay home, city leaders say.
The capital has some of New Zealand's highest vaccination rates but a business group worries a "shadow lockdown" scenario may greatly stifle the economy.
"You've got the lockdown in reality, minus the Government support," Wellington Chamber of Commerce chief executive Simon Arcus said.
"We've got a strong public sector footprint which has good planning in place, but they will stay out of the CBD."
The city entered its first full day in the red traffic light Covid-19 mitigation setting on its anniversary, observed as a public holiday.
Arcus said relative insulation from prior worldwide pandemic surges meant Omicron case numbers could shock some people.
Prime Minister Jacinda Ardern recently said overseas evidence showed cases could grow from the hundreds into the thousands in just a fortnight.
"We're not conditioned for this in the way that other countries are," Arcus said.
"We don't know the experiences other countries have had with Alpha and then Delta."
In New South Wales earlier this month, Covid-19 patient numbers rose by more than 120 a day, although the surge there appears to have peaked.
Arcus said a Wellington December business confidence survey showed more pessimism was present than a year earlier, and he expected confidence to dip again this month.
"We expect we'll see worker shortages meeting slower spending."
He said businesses were trying to understand processes to activate if workers got infected, and wanted clarity around rapid antigen tests (RATs) and surveillance testing.
"A lot of businesses are saying: We have good planning in place, and that's a plus, but there are also signs that plans may have to be flexible."
Arcus said several businesses, mostly medium-sized hospitality and manufacturing firms, had approached him today about rapid tests.
Finance Minister Grant Robertson yesterday said some larger businesses had their Rats stocks and could order the tests already.
Robertson said more clarity on Rats provision should be provided this week, and in the meantime the Government was focused on getting the tests to essential workplaces.
The minister said an Omicron outbreak could cause supply chain and workforce disruption, due to the need for people to isolate.
Robertson also announced a leave support to pay people up to $600 a week to self-isolate, if they cannot work from home.
In the meantime, Arcus urged people to try support city businesses.
"We want to see people trying, as much as possible and where they feel safe, to support these businesses."
Mayor Andy Foster also urged residents to support local companies during a challenging time.
"Central cities around the world have suffered particularly badly from the whole work-from-home situation in the last couple of years."
He said Wellington was fairly well-positioned for Omicron, with 97 per cent of Capital and Coast DHB residents fully vaccinated, and the new strain's arrival had been anticipated.
"We know it's been knocking on the door for a while, certainly in MIQ."
It was just a matter of time when the Government made a call to enter the red light setting in response to local cases, he said.
Foster said Wellingtonians seemed to be conscientious about Covid-19 mitigation measures.
"I see very high levels of mask-wearing and, I think now, in scanning."
Foster said for the events sector, the red light setting was devastating.
And he said people organising activities scheduled a few weeks into the future had no way of knowing if their events would go ahead.
He said it was difficult for any Government to navigate the crisis, but guidance was needed on what the priorities were in the red light stage.
He said it wasn't clear now if the emphasis was on keeping new infection numbers down, rolling out boosters, speeding up child vaccinations, or keeping the hospital system from being overwhelmed.
Foster said some presumably credible modelling showed half the population could get Omicron, but it wasn't clear how long this spread would take.
"We all want to see some clarity about what the end game with this is."