New South Wales has started the new year with a slight increase in Covid-19 cases, with the state recording 22,577 new infections and four deaths.

Hospitalisations have risen to 901 – up from 832 in the previous reporting period – with 79 patients in intensive case.

Today’s figure is the highest number of daily cases recorded in any Australian jurisdiction.

NSW yesterday reported 21,151 new cases, which was just under the total infections recorded nationally the previous day.

NSW Premier Dominic Perrottet has repeatedly declared the state is in a “strong position” amid rising infection figures and chaos caused by ballooning testing demands.

“We’ve seen a significant increase in case numbers, but what is pleasing is that our health system remains strong,” he said on Friday.

At the current trajectory, the number of patients admitted to hospital for Covid in NSW could exceed the 21 September record of 1268 within a week.

But intensive care admissions during the current outbreak have not been growing at the same rate as hospitalisations.

The NSW government earlier this week dramatically slashed the isolation period for healthcare workers who were categorised as close contacts to one week.

Late on Friday, NSW Health issued a statement saying exemptions now exist for asymptomatic staff deemed as close contacts to leave self-isolation – but only in exceptional circumstances.

However, it said, if these workers developed any symptoms, they must immediately seek a PCR test and not attend the workplace until a negative result is received.

The new exemption signed by Health Minister Brad Hazzard applies to workers in both the private and public system and aims to “minimise potential impacts on health services across the state”.

“The exemption allows these close contacts to leave self-isolation to attend their workplace, provided they have been identified by their employer as critical to the service and cannot work from home,” NSW Health said.

Health unions and frontline workers across NSW say critical staff shortages through the holiday period have raised concerns about the quality of patient care.

An email sent to staff by St Vincent’s Hospital executive director Kevin Luong on Thursday, obtained by the ABC, outlined how low staffing levels could play out over the next few days.

“We are continuing to experience critical staff shortages across the organisation, particularly in nursing,” Dr Luong said.

“Whilst we are trying our best to work around this, we are beginning to run out of options to maintain safe nursing staffing levels.”

There were 119,278 Covid swabs taken in the last 24 hours, down from the 148,410 tests taken during the previous reporting period.