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Food sector faces skills and labour shortage

The UK’s £110bn food and drink supply chain is battling a shortfall in skills and labour exacerbated by the countdown to Brexit.

Last updated: 27 Nov 2020 6 min read

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  • One in five UK-based EU nationals are employed in the food and drink supply chain
  • A third of the workforce is due to retire by 2024, leaving the industry facing a shortage of about 140,000 recruits
  • Sector needs to work to attract talent and upskill existing employees as it moves towards further digitalisation and automation

Almost half (47%) of businesses across the food and drink sector say EU nationals in the workforce are considering leaving the UK because of uncertainty about their future, according to a survey co-ordinated by the Food & Drink Federation (FDF) among members of key trade bodies.

More than a third (36%) say their businesses will become unviable if they do not have access to EU workers and 31% have seen EU nationals leave since the referendum.

Trevor Griffith, head of food and beverage at Grant Thornton, which the FDF commissioned to examine the challenges and opportunities facing the sector, says the Department for Environment, Food & Rural Affairs (Defra) estimates EU workers represented about 29% of the industry workforce in 2015.

The FDF’s Breaking the Chain report, published in the summer, says 20% of the now more than two million EU nationals across the UK are employed in the food and drink supply chain.

Seasonal workers are going home

Julia Long, national officer for food, drink and agriculture at the Unite trade union, says the seasonal workers from the EU have all gone back, exacerbating shortages of labour in fields, horticulture and food processing. “It’s because of fears of what is going to happen, about what their status is going to be in the UK,” she says.

The meat products sector is especially exposed, Griffith points out: the British Meat Processors Association estimates that 63% of the workforce comes from the EU.

Food industry education and training charity IGD notes that engineering roles are the most difficult to fill, followed by jobs that require specialist technology skills, such as developing robotic solutions, food production and other technical jobs such as quality assurance, followed by science-based roles such as food scientist or nutritionist.

Shortage of recruits

Selga Speakman-Havard, FDF policy manager for industrial strategy, skills and employment, says a third of the workforce is due to retire by 2024, leaving the industry facing a shortage of about 140,000 recruits.

“We recognise the need for the whole food and drink supply chain to come together to identify the gaps and the challenges to use so we can start building a really clear case for government,” she says.

Griffith believes a common misconception exists that workers in the sector are low-skilled and, consequently, low-paid, but research as part of the Grant Thornton study found that if education levels are used as a proxy for skills within the industry, then it has a huge amount of diversity and talent.

He says 30.8% of employees are low-skilled, in jobs requiring little or no experience; 36.7% are semi-skilled, in jobs requiring some experience and training; and 32.5% are skilled or highly skilled, requiring a degree or postgraduate degree/PhD and experience.

“We need to be better at shouting about exciting opportunities… We see the UK as a real hub of research and development in food and drink manufacturing”Selga Speakman-Havard, policy manager for industrial strategy, skills and employment, Food & Drink Federation

“Similarly, when looking at the composition of the workforce from the perspective of nationality, there is a real breadth of skill,” he says. “Although EU workers make up 38% of employees in roles which require no qualifications, a significant proportion do have qualifications, such as an international baccalaureate.”

Furthermore, 19% of employees working in higher-skilled jobs are from the EU, Griffith adds.

Better salary packages demanded

Richard Hanwell, associate director of The Sterling Choice, a recruitment agency that specialises in the food sector, says manufacturers now have to offer better salary packages, even for “lower roles”, which he says will have a knock-on effect in shops.

“Fewer Europeans are seeing Britain as a better option, and employers are trying to seek options closer to home. However, the industry isn’t currently being seen as a preferred option.”

Hanwell does not feel the industry is doing enough to attract talent to what could be a fantastic career “with endless opportunities in a multitude of roles and pathways”.

Speakman-Havard says the industry recognises the need to come together to produce “a critical mass of learners” and upskill existing employees as the industry becomes more innovative, moving further towards digitalisation and automation.

“We need to be better at shouting about exciting opportunities… We do really see ourselves as a competitive place for work. We see the UK as a real hub of research and development in food and drink manufacturing.”

A need to nurture talent

The UK food and drink sector is committed to growing its homegrown workforce but it still sees the value of having people from all over the world, she says.

“The two-year transition period [prime minister Theresa May is seeking] will be very important for our industry. Anything that provides greater certainty for food and drink manufacturers is a positive thing for us. We are keen to work with the government in any way we can to help the industry feel that certainty.

“We need to see numbers of apprentices growing and a gradual decrease in our reliance on workers from outside the UK, but it’s still important to maintain some expertise coming from overseas as well.”

A skills and labour shortage has already started to have an impact on prices in the shops, with food inflation running at 3.2% (for the 12 weeks ending 10 September), according to Kantar Worldpanel.

Chris Slay, managing director of global recruitment business Skills Provision, says the decline in sterling’s value against the euro since the referendum has made jobs on the European mainland more attractive to workers.

Increasing xenophobia in the UK is also encouraging workers from the EU to look elsewhere, and hyper-competitive food retailers’ squeeze on suppliers has pushed down pay in the supply chain.

Ministers in ‘listening mode’

Environment secretary Michael Gove has met key food industry representatives to discuss the labour issue. His department says it is listening to the sector, considering the latest data and working closely with the industry to understand the position on labour demand and supply.

Defra also says that the government has been clear that after the UK leaves the EU, it must control immigration from Europe while continuing to welcome those individuals who make an invaluable contribution to the UK.

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Leadership and Management, Agriculture