Food prices, which are already rising due to higher raw material and transport costs, are threatened by global labor shortages. Whether they are fruit pickers, slaughterhouse workers, truck drivers, storekeepers, cooks or waiters, the food system is collapsing. Many employers therefore have to raise wages significantly, Bloomberg said.
In Vietnam, the army is helping to harvest rice. In Britain, farmers pour milk because they do not have cars to take it. Robusta coffee has been harvested in Brazil for 120 days this year instead of the usual 90, while US meat processing plants are trying to attract new employees to Apple Watch watches and fast food chains are raising prices for burgers and burritos.
The covid-19 pandemic has contributed to labor shortages in many sectors. This impact is particularly pronounced in the food and agriculture sectors, which are among the least automated sectors. Food security is a sensitive issue in many parts of the world, and low margins in the industry mean that rising costs are usually reflected in prices, the Boston Consulting Group (BCG) said.
There are signs that labor shortages are limiting supplies. In the US, wholesale distributors such as Sysco and United Natural Foods report delays and slowdowns in the production of some items – from bacon and cheese to coconut water and spices. In Britain, some stores run out of basic goods such as bread and chicken, and McDonald’s fast food chains ran out of milkshakes in August.
Not only farms, but also processors and restaurants feel the lack. Malaysia, the world’s second-largest palm oil producer, has lost about 30 percent of its expected edible oil production. Shrimp production in South Vietnam, one of the world’s leading exporters, has fallen by 60 to 70 percent compared to the pre-pandemic period. And southern Italy has lost a fifth of its tomato production, according to the CIA’s agricultural association, due to scorching heat and paralysis of traffic.
“I have been working in this field since the 1980s, but I have never experienced such a situation,” said Michele Ferrandino, a farmer from the Italian city of Foggia. “Tomatoes are perishable goods. There were not enough trucks to transport the crops to processing plants on harvest days,” he added.
Canceled or delayed deliveries also forced British farmers to pour milk, which is missing in shops. Farmer Mike King of South Gloucestershire estimates he lost 20,000 gallons of milk, adding that some farmers milk cattle less often due to a lack of staff.
Employers also face another hurdle – employees have a lot of options. The current economy is creating “a choice where it has not been in the past,” BCG points out. According to him, when the whole world does not have enough workforce, it is more difficult to fill less sought-after jobs. And finding employees in the food chain can be difficult. Whether it’s laborious strawberry picking, dangerous slaughterhouse work or a fast and demanding restaurant kitchen environment, many jobs are physically demanding, short-term or poorly paid, or a combination of all of these.
Australians who used to be content to work in meat establishments in sparsely populated areas can now choose to work in busier cities thanks to a wider range of jobs. Many EU citizens, who usually traveled to Britain to work on farms, in freight or restaurants, chose to stay in their home country or on the continent. American workers, who have struggled with the scorching heat in the fields, can now prefer the cool interior of the store.
President of the Union of Fruit Growers of the State of Washington Jon DeVaney recognizes that collecting fruit is hard work. “You pick the fruit and carry it up and down the ladder, so if your alternative is to push the buttons at the cash register, it may be more tempting,” he said.
However, they do not feel the shortage of workers everywhere and the effects are not uniform. Much of mainland Europe does not experience the same crippling shortage as Britain, where Brexit has reduced the influx of EU workers. China does not feel a shortage of workers either, and there are also enough workers in India, where coronavirus restrictions on agriculture have hardly affected them.
Elsewhere, however, the workforce is one of several problems in the world’s food ecosystem. Extreme weather from Brazil to France had an impact on the harvest. Rising crop prices have increased the price of livestock feed and thus meat prices. Transport costs have risen sharply due to growing demand, lack of containers and port congestion.
Due to the lack of staff, there is a risk that costs will increase. And the problem probably won’t go away with the end of the pandemic. The share of agricultural workers has been declining for decades, due to the relocation of people to cities and employees in the service sector. It was difficult to find employees for some jobs long before covid-19. These more permanent changes in the labor market require technological solutions and, during the pandemic, significantly accelerated investments in automation and robotics.
In the USA, human labor is being replaced by automated tractors, robotic milking machines or carrot planting machines. In Britain, farmers are testing robots to pick strawberries, lettuce and broccoli. In Brazil, robusta coffee growers have helped harvesters reduce their reliance on manual labor by a fifth. But according to Rabobank financial analyst Cindy van Rijswick, it will take years for robots to really catch up in agriculture.
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