Friday, March 24, 2023

National Skills Academy for Food & Drink lays bare double whammy of staff shortages and rising costs facing UK food manufacturing

UK food and drink manufacturing and processing businesses are facing unprecedented challenges in keeping affordable food on the nation’s table according to new in-depth research by the National Skills Academy for Food & Drink (NSAFD), the sector’s industry-led skills experts.

Rising costs and labour shortages are accelerating transition to greater use of automation and digitally-controlled production. But according to the NSAFD’s keynote report, economic and political uncertainty are undermining business confidence and ability to invest — both in new plant and necessary workforce training for its effective use.

Insight highlights:

  • Rising energy and transportation costs are hitting Food & Drink Manufacturing and Processing harder than other sectors.
  • Over three quarters (77%) of businesses are suffering from staff shortages in jobs without high skill hurdles with 45% of those surveyed describing the situation as chronic. Some 60% of food and beverage businesses have experienced low applications for advertised jobs, resulting in higher labour costs.
  • In the face of labour shortages, demand for increased productivity is leading to more widespread uptake of smart technology manufacturing processes. But economic and labour market challenges, coupled with threats of recession, are liable to affect the ability and willingness of firms to invest in transformational plant and associated training.
  • The industry is likely to require an increasing range of multi-disciplinary business skills in future, not just those typically associated with food production. These include digital skills, procurement, supply chain management, environmental management, sustainability and data analysis and management.
  • Over 80% of businesses are ‘strongly in favour/in favour’ of the Apprenticeship Levy but most want greater flexibility in its use to support other programmes, traineeships and employees. Apprentices represented 1% of the workforce in over half of responding businesses, 1-2% in 20% of firms and 2-3% in over a quarter of companies surveyed.

The 44-page report commissioned by the NSAFD provides the latest facts, figures and analysis of key strategic areas affecting the current and future fortunes of the UK’s £112 billion turnover food and drink manufacturing and processing sector which currently employs almost 451,000 people across 11,675 enterprises.

Commenting on the research release NSAFD CEO Louise Cairns said: “Small and medium-sized businesses form the vast majority of UK Food & Drink firms. As an organisation dedicated to helping companies grow by strengthening workforce skills and attracting new talent, we want to ensure they have access to vital Big Picture data at this time of economic challenge.

“Larger manufacturers may be able to turn to internal resources to assess changing market pressures but we’re absolutely certain they will also find a range of information nuggets in this landmark report.”

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