My 5yo (just started Y1) is what we’ve always called ‘shy’. At home he is extremely boisterous and loud, but outside the house he is very quiet/visibly anxious/shy in many situations.
He was slow to start talking (wasn’t properly speaking until he started pre-school) and his amazing nursery teacher really helped get him to come out of himself in school, she described him as ‘slow to warm up’ and said he just needed his own time to get comfortable and she wasn’t concerned.
Before starting preschool he would have mostly refused to participate in toddler classes, but now he will get involved, albeit generally not talking much, and is happy for us to leave and come back.
He will talk and play with our friends’ children, he won’t always say much but says enough to engage in play with them and he is never without people to play with in school. He also must talk to his school friends as he tells me stuff about them and things they’ve said in response to stuff he’s told them.
Last year in Reception he only spoke to the teacher/TA a handful of times, he was doing it more frequently but then lockdown happened.
Now he’s in Y1, the continuity of class from last year has helped however any time we see his classmates he will refuse to talk to them and cover his face if we are there. This happened a few times over the summer if we saw them out and about, but I put it down to lockdown. However now if we are at school and one of them calls to him to walk in with him or says hi/bye he does this.
He is quiet in class, and I worry he will miss out on so many activities if we can’t help him. Last year he was in the ‘bottom’ groups because the teacher couldn’t figure out his ability level. Her only advice was we had to tell him to speak to make him do it in class 
How do I address this? Do we let him grow out of it in his own time or does it require intervention?