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Food Manufacturers face huge Labour shortages

Food Processors and Growers in the UK face "a clear emerging labour crisis" in the wake of the Brexit vote, NFU deputy president Minette Batters told an audience of governmental, regulatory and industry figures at a policy seminar in London on 1 December.

"The sector is in shock and if nothing is done, fruit and vegetables will be left to rot in the field," she warned. "All our farmers would love to employ UK workers and do advertise locally. One grower had 600 places to fill and got six applicants. There has been a cultural change that we didn't notice because at the time we didn't need to. We have pickers who can pick a tonne of fruit a day - your average British student wouldn't be up to that or even want to."

Upcoming Brexit negations on trade will potentially impact the sector still further, she added. "A big part of the single market is the protection it has given us from countries with different production standards. I can't compete with beef from Brazil. We want trading arrangements with countries that have the same standards as we have."

But the challenges predate June's referendum, she noted. "The price of strawberries is the same as 15 years ago. We have had so many costs to absorb in that time. Mechanising the supply chain to reduce our reliance on migrant workers will require massive investment. But we are living with a retail price war that isn't going away."

Batters added: "Asking shoppers to pay more for British produce will never work. It has to be affordable for everyone. We mustn't turn British farming into an industry of niche products that not everyone in the country can afford."

She said of the Red Tractor assurance scheme, currently undergoing consultation: "It's the flagship of British food but we have much to learn from Ireland's Bord Bia, which has got all parts of their farming sector aligned. The Union Jack simply isn't good or robust enough on its own. It needs to be underpinned by credibility and integrity at all levels. Red Tractor is brilliant for things like traceability, which is essential for, say, the Chinese market. But it's 20 years old. It's time to have a conversation about what its brand identity is and what we want from it in the next 10-20 years for the home and global markets."

She added: "Brexit was a vote for the UK, so what about procurement? More British food on school and hospital plates is part of what people voted for."

Institute for European Environmental Policy senior fellow Kaley Hart told the Westminster Food & Nutrition Forum that "the scale of (public) expenditure needs to expand" to meet environmental and social demands. "Brexit gives us the opportunity to think about what we want from farming, including maintaining the cultural landscape and social make-up of the countryside. It's difficult to know the scale and nature of funding required for this, but it needs to be better designed than it is at the moment. Five billion pounds would meet our environmental goals, but that's five times what we currently spend. It should be results-based, rather than a matter of telling farmers what to do."

Driving productivity

On this theme, AHDB head of sustainable food and farming Susan Twining said: "Working with farmers is key to driving productivity and sustainability. What makes farmers adopt new practices and technology is the promise of greater returns, or the avoidance of risk. They are more likely to engage with more visible environmental measures like bird protection rather than, say, carbon capture. The food industry is in a good position to drive farm sustainability, as we have seen with PepsiCo's Smart Potato programme. But to be undertaken successfully across the supply chain, the risks and rewards have to be shared."

Farming's adoption of technology needs to become less patchy, National Centre for Universities & Business Dr Joe Marshall told the seminar. "There are some fantastic pockets of innovation in agri-food but they need joining up across the supply chain. We also need to get better at transferring knowledge from one sector to another, such as with robotics. Companies in food and farming have little knowledge of academic institutions compared to other sectors."

Such institutions "aren't only interested in pure research - they have an 'impact agenda' and want to know where and how they can add value", he said, adding that businesses wanting to work with them "will find a receptive audience", particularly in light of the increased funding for research promised in the chancellor's Autumn Statement.

But University of Lincoln professor of agri-food technology Simon Pearson said: "There is now a funding gap. The Agri-Tech Strategy has been a huge success. It has delivered on many fronts and awakened the chain to the possibilities. But that's now run out and we have some urgent questions still to ask."

The food and farming sector has the potential for greater entrepreneurialism with the right sort of assistance, according to Rob Ward, co-founder of Grocery Accelerator, currently assisting 16 food companies with mentoring, peer-to-peer support and PR. "It provides them with an injection of entrepreneurialism," he said. "I don't believe in long-term subsidies, but if you want innovation you have to support it."

Ward, who began his working life on the family soft-fruit farm in Shropshire, added: "A food business can be one of two things - cheap or extraordinary. There's nothing clever about cheap FMCGs. But suddenly innovative start-ups are being pursued by major corporations," citing Amazon's Launchpad, Tesco's Backit, and similar moves by Ocado, Unilever, Coke and Virgin. "You can't put prices up just because your input costs have gone up," he noted. "You put up prices because it's worth more to your customers."

Food & Drink Federation competitiveness director Angela Coleshill identified another area where outside help could boost the sector. "Only five per cent of companies export. Its' hard to get started," she said. "The potential is there but needs support. The federation aims to increase Britain's branded food and drink exports by a third by 2020."

Source: - 8 December 2016