factory worker staff production

Workers across the supply chain are in short supply

Worsening supermarket food shortages are now “inevitable” in the coming weeks as labour shortages across the food supply chain approach crunch point, the sector has warned.

Chronic driver shortages have been compounded by shortfalls across other low-paid sectors including harvesting, manufacturing and packaging, and the supply chain is creaking under the pressure.

Trade bodies, logistics firms and suppliers all warn that the continued reopening of the economy combined with the start of the summer holidays will see a tipping point in supermarkets’ ability to keep shelves fully stocked.

“The real crisis for food supplies starts now,” said Shane Brennan, CEO of the Cold Chain Federation, adding that while he was typically wary of empty shelf warnings, “this time definitely feels different”.

Many of the factors fuelling the driver shortages are the same now causing problems in other sectors: European workers returning home due to Brexit and Covid, new visas needed for unskilled workers, and the winding down of furlough placing a renewed strain on the labour pool.

“Everywhere you look in a supply chain there are problems,” said Brennan. “Food already isn’t being replenished into supermarkets quick enough and it’s not just because of logistics but a lack of production.”

The start of summer is expected to intensify the strain as workers start using up to five weeks holiday accumulated while on furlough. While most years see a diminished workforce during the summer months, it is usually balanced out by an equivalent drop in demand as holidaymakers flock abroad. But with many Brits to remain in the UK this year, the demand on supply chains will be relentless.

Mark Crawford, a director at fruit supplier Blue Skies, said the diminished labour pool had left businesses struggling to find workers at an affordable rate. The result was “one of the hardest weeks I have ever had in the industry”.

He called on government to act rapidly to ease restrictions on foreign workers entering the UK. “Our food industry is in a full-blown crisis. We need the workers to help produce, pack and distribute.”

Meat processors are similarly struggling to fulfil orders. The British Meat Processors Association said this week that some processors have lost 10% of their workforce and were now about two weeks away from cutting deliveries to retailers.

Deliveries to supermarkets are already being missed and “the worst is definitely yet to come”, said Shaun Leonard, head of temperature-controlled transport at Turners Soham, a major trucking company.

Effects across the supply chain are already “biting hard”, he said. “We see it in packhouses [for fruit and vegetables] where you need agency staff to double or triple your workforce depending on the day. We see food manufacturers struggling to find production staff to work the lines. Suppliers are having to rationalise the number of product lines as a result.”

Among hauliers, the strain is worsening as the reopening of pubs and restaurants continues to increase demand. It has pushed logistics companies to drop delivery slots with customers with a reputation for long queues or delays, according to one logistics operator, although every delivery route has had to be reshaped.

Yet while some supermarkets are collaborating with hauliers to manage the disruption, they said, others are “sticking their head in the sand thinking this can be fixed with a few quid.”

Andrew Opie, director of food & sustainability at the BRC, said retailers are aware of the fall in driver numbers and working with “suppliers to ensure that consumers still have the same great selection of fresh produce.”