One of the less obvious impacts of the Brexit vote and the decision to leave the EU is the effect that this has had on the labour market in the food and drink industry – and the potential for increased food costs as a shortage of workers leads to competition for workers and increased wages affecting not just farms but food production, restaurants and hotels.
On 26 June, just over a year after the EU referendum, the UK government published a policy paper setting out proposals for “safeguarding” the position of the estimated three million nationals of the European Economic Area (EEA) and Switzerland who currently live in the UK by the creation of a new category of “settled status” for individuals who have lived here for more than five years. Unfortunately, many of those involved in the food and drink sector, particularly in food production, are employed on a seasonal or temporary basis and will not be able to show sufficient residence in order to gain settled status.
A recent report by the Association of Labour Providers (ALP) whose members supply 70 per cent of the temporary contingent workforce in the food growing and manufacturing supply chain, highlighted that the food and drink sector has already been affected by the impact of this uncertainty on migrant labour.
Devaluation of the pound by 20 per cent has also made the UK a less desirable place for EU migrant workers. The ALP survey concluded that for summer 2017, 21 per cent of labour providers do not expect to be able to supply enough workers for their requirements. The UK is no longer the best country to make more money than at home. Previously, Bulgaria and Romania were the key labour sourcing countries for UK agricultural seasonal workers, looking for guaranteed jobs and higher wages. Now, Romania and Bulgaria both have jobless rates below the EU 28 average, so having to work abroad for months on end, for less money than before, is no longer so appealing.
A recent House of Lords European Union Committee report on the impact of Brexit on Agriculture highlighted the need to address the issue of the loss of EU migrant workers and their place in our food and drink sector. The report recognised that technology cannot materially reduce the need for EU agricultural workers but at present, we in Britain do not have sufficient labour to address the shortfall. We will therefore require to establish ways of continuing to allow non-UK citizens to work in the agri-food industry but also to encourage UK workers to become more involved in this industry or there will be major food disruption.
Many of the roles undertaken by EU workers are what UK workers consider to be undesirable jobs, often in unpleasant conditions and in agriculture terms, in rural areas, all for the National Minimum Wage. They are assumed to be unskilled jobs but as the House of Lords report points out, many of these roles do in fact, involve a considerable degree of skill. Crop handling and harvesting do require particular skills. Having skills with a knife is essential to abattoirs. Such skills are often ignored.
In order to address this concern, we will need to reappraise how we classify the work undertaken by those workers. We have to be innovative in assessing and recognising what actual skills are involved in the multitude of jobs that make up the food and drink sector. Now is the time that we must invest in training of our own workforce and to make the food and drink sector a more attractive employment proposition and a career of choice.
We will need to find innovative ways of encouraging workers into the food and drink sector and appreciating their particular skills and the importance of these to our economy. Nevertheless, a UK workforce alone is not going to meet all of the industry’s workforce needs. Scotland’s food and drink industry is becoming increasingly global. Even with a new emphasis on training to encourage a home-grown workforce, our need for workers will continue to require us to look beyond our own borders. The UK government proposes a visa programme based on “skills”. Generally, this assumes an academic qualification or unique occupation. Reassessing the way in which we recognise skills in the industry, may help ensure that those involved in these jobs will be available to the industry as well.
Paul Brown is a partner and head of the food and drink team at Anderson Strathern. He is a speaker at The Scotsman’s annual food and drink event on 26 September: www.scotsmanconferences.com