Late last year, the Canadian Agricultural Human Resource Council and the Conference Board of Canada released a Labour Market Information Study or LMIS.
Sure, we all know that there all kinds of studies on all kinds of subjects floating around this country and many of them – if not most of them – are gathering dust on some shelf in some government library.
However, this study was relevant. And also a little bit frightening. It also drove home a reality that people in the beef, pork and poultry industries have been living for years.
This particular LMIS put an exclamation point on the fact that labour shortages (both skilled and unskilled) are having a significant impact on Canada’s agriculture sector and Canada’s beef, pork and poultry industries are seeing shocking vacancies throughout the value chain -- from the farm, ranch and feedlot level right through to the processors.And if you think the word “frightening” is a little hyperbolic, think again. This shortage of labour is not just a corporate problem, but one that has almost solely been created by government restrictions and regulations.
“The meat industry is not homogenous,” said Ron Davidson, the Director of International Trade, Government and Media Relations for the Canada Meat Council. “First, it includes facilities in rural locations, particularly abattoirs and slaughterhouses, and it also includes facilities in urban locations, particularly further processing facilities.
“Ensuring sufficient workers is rarely an easy endeavor for any meat packing or processing plant. However, the most severe implications of government-imposed restraints on access to labour are experienced by establishments situated in rural locations in which the meat plant is frequently either the largest or one of the largest employers in the region. Particularly for operations located in rural Canada, the repercussions are grave for farmers, for meat packers, for workers, and for rural municipalities.”
According to Davidson, “The industry recruits aggressively, constantly and nationally,” and still it can’t find enough people to fill the vacant positions. In fact, it isn’t even close.
“Scouring the country in search of the unemployed, new immigrants, refugees, indigenous people and youth is not a new endeavor for the meat industry,” Davidson explained. “This has been an everyday practice for many years.”
And what does the industry offer? According to the CMC it’s quite outstanding: “The industry offers jobs that are fulltime, not part-time with substantive training. Incomes are well in excess of minimum wages with periodic increments and opportunity for advancement. There is a very comprehensive suite of medical, dental, vision, insurance and retirement benefits and, for most workers, immediate membership into a strong union (e.g., United Food and Commercial Workers).”
“Notwithstanding these benefits, there is a chronic under-supply of butchers and meat cutters everywhere in Canada and, among those who are interested in the occupation, only minimal numbers who are willing to relocate to a rural environment,” Davidson continued.
“I would invite anyone to enter the Employment and Social Development Canada home page, type ‘butcher’ and subsequently ‘meat’ in the Job Finder. The first will result in a list of several -- usually five -- pages of employers, mostly retail outlets in urban locations, seeking butchers as well as others like meat companies in rural locations. These meat companies often seek as many as 100 butchers for a single plant. The government needs only to consult its own website to substantiate that there is a chronically insufficient supply of butchers in Canada to satisfy urban demand without even considering hundreds of unfilled positions in rural locations.”
Sadly, not only do government programs not require that unemployed Canadians relocate to rural regions to accept job offers, some government programs constitute strong incentives (access to government supports and services etc.) to remain in urban environments regardless of the absence of work.
“In essence, current government policies have, to some extent, the effect of downloading urban unemployment challenges onto the shoulders of rural businesses and rural communities,” Davidson said. “Government policy-makers express concern about the possibility that a meat packing plant may close. There would appear to be a lower intensity of concern that current policies are resulting in the slow suffocation of both companies and rural communities.”
If you haven’t figure it out yet, a shortage of labour in the meat industry is not just a problem, it’s a crisis.
The LMIS found that annual farm cash receipt losses to Canadian producers due to job vacancies are $1.5 billion or three per cent of the industry’s total value in sales and production. We don’t need to tell anyone, that that has a significant impact not just on the agriculture sector, but on the entire Canadian economy.
In fact, again according to the LMIS, in 2014, unfilled vacancies cost the Canadian beef industry alone $141 million in sales (farm gate cash receipts).
The CAHRC also reported that the current gap between labour demand and the domestic workforce is 59,000 people and projections are showing that by 2025, the Canadian agri-workforce could be short workers for 114,000 jobs. Say that number slowly – one hundred and fourteen thousand jobs.
“On the beef side, the LMIS has indicated that over the next 10 years, the labour gap in the Canadian beef cattle industry could widen to 12,500 workers,” said Brian Lemon, spokesman for Manitoba Beef. “A significant reason for this is that our beef producers are getting older. We could see up to one-third of the current workforce retire over the next 10 years. We need to find effective strategies to meet this very serious challenge.
“Some have estimated that there are currently upward of 1,000 job vacancies alone in Canada’s meat processing sector right now, not counting the vacancies at the farm or feedlot level,” Lemmon added. “This can result in lost opportunities when these plants are not running at full capacity. You can end up in a situation where Canadian food, including cattle, may be sent to the United States or Mexico for processing, only to come back as an imported product. That can cost Canadians more money at the grocery store. It also translates into exported jobs and economic opportunities when those cattle are processed outside Canada.”
There are other problems, as well. According to Lemon, when plants in Canada are unable to run at full capacity, it can result in a reduction in the production of lucrative value-added items and the potential to export those items to existing or emerging markets.
“It’s very important to the future of the Canadian beef industry that we can retain and fully utilize this processing capacity at home,” Lemon said. “It’s a critical component of our industry’s value chain, helping us supply both our domestic and international markets with our high quality Canadian beef.
“As well, there have been significant efforts by governments to achieve new or increased market access for Canadian products, such as the Trans-Pacific Partnership or the Canada-EU Comprehensive Economic and Trade Agreement. We’ll need to raise more cattle to help supply our high quality Canadian beef, cattle and genetics into these various markets. At the farm or ranch level, there will be producers wishing to expand their operations to take advantage of these opportunities. However, to move forward from a position of confidence, they need to know that they will have access to those extra sets of hands on their operations when they need them. We don’t want to forfeit these opportunities.”
It is also discouraging to note that the Canadian government has agreed that Canada’s meat industry is suffering from what it calls, “a permanent worker shortage.” And yet, there is now a federal cap on the number of low-skilled workers in Canada. As of July 1, 2015, the number of low-skilled foreign workers that employers can hire will be capped at 20 per cent. The reduction in foreign workers was announced last June by then Employment Minister Jason Kenney — at the height of public criticism over reports of abuse within the Temporary Foreign Worker program. That cap is slated to drop, again, to 10 per cent by July 1, of this year.
The cause of this unfortunate situation had little or nothing to do with the meat or the overall agricultural industries. Turns out, it was a series of abuse scandals in 2013-2014, primarily in the fast-food service and banking industries, that got the Conservative government of Stephen Harper in hot water. Canadians were said to be furious that temporary foreign workers were being brought in by certain companies in lieu of hiring locally.
One company, the Royal Bank of Canada, was actually accused of firing Canadian employees in order to outsource jobs to foreign workers. That one transgression started a public relations nightmare for both the bank and the federal government.
Still, at least in the meat industry business, there are plenty of great jobs for unemployed Canadians, and yet it is difficult to understand why there isn’t a lineup to get training and take advantage of what is already a grave labour-shortage situation. Many qualified people could almost write their own tickets, as they say.
“Canadians are becoming older, more urbanized, more highly educated, and significantly less willing to accept jobs in rural communities,” said Davidson. “In addition to the industry maintaining the current practice of aggressive, continuous and national recruitment and training, the industry must be provided with the option of seeking foreign origin workers when it has been demonstrated that there are insufficient numbers of Canadians who are willing to fill vacant positions. This outcome can be achieved by a variety of options, including but not limited to, federal and provincial pathways to permanency and eligibility of chronically undersupplied occupations for Express Entry.”
Leaders in the meat industry agree that there are plenty of solutions. They just wish more people, especially at the federal government level, were listening. After all, as Lemon points out, we cannot understate how important having a strong agriculture and agri-food system is to the Canadian economy. Fact is, that industry accounted for one-in-eight Canadian jobs in 2012, in areas ranging from primary production to food and beverage processing to food service and more.
“Analysis has shown that for every worker employed in the beef sector another 4.2 workers are employed in Canada (counting direct and indirect impacts) and almost 7 workers are employed if all impacts are included,” Lemon added. “That really demonstrates the importance of the beef industry alone to the economy.”
Of course, this isn’t just a beef issue. It’s a problem right across the spectrum. In fact, because of a labour shortage in the pork industry, fewer sows are being bred and thus, fewer piglets are being born. These are shortfalls that trickle down the supply chain and hurt the processing plant.
However, most leaders in the meat industry are convinced that there are ways to make the labour shortage go away. At least, in the stunning numbers that exist today.
“The need for a solution to the labour shortage issue is imperative,” said Brady Stadnicki from the Canadian Cattlemen’s Association. “With increased trade opportunities looming and the average age of cattle producers rising to the point where 15-20 per cent of them will retire in the next 10 years, the demand for labour in the beef industry is likely to increase substantially in the future.
“One solution that all segments of agriculture and primary processing stand behind is the implementation of recommendations made by the Labour Task Force’s Agriculture and Agri-Food Workforce Action Plan. The WAP addresses the needs to increase the labour supply of skilled and unskilled workers, and improve the knowledge and skills of workers in the industry.
“The profitability of the beef industry is also key to ensure new entrants choose to make their living by raising cattle. A competitive business and regulatory environment, market access and continued research and innovation are integral to a profitable beef industry. CCA initiatives such as the Cattlemen Young Leaders program and Young Cattlemen’s Council are working to encourage new entrants into the beef cattle industry and develop leadership and policies that will help transition the next generation of beef producers into the industry.”
According to Davidson, “Canadian negotiators have obtained major new opportunities to increase meat exports and the associated expansion in employment and economic growth in rural municipalities.
“Unfortunately, the opportunities that have been paid for and opened by government trade negotiators on one hand are being nullified by government policies on the other hand that prevent expansion of the industry to take advantage of the new export opportunities. Feed grain farmers, livestock producers, and meat packers and processors want to move forward. What is required is a government policy framework that will catalyze rural expansion rather than rural retraction.”
According to Jennifer MacDonald, past chair of New Brunswick Cattle Producers, the short term solution is simple: “Allow the industry to access more foreign workers.”
“Long term we need to encourage immigration for these fields,” she said. “And we need to encourage Canadians to consider this line of work, although, to be fair, this line of work is not for everyone.”
Perhaps not, but if you’re a healthy Canadian looking for a good job, a future in the meat industry – no matter whether it’s beef, pork or poultry or where it happens to be on the supply chain – is a solid investment in your future. If you really want to work, there is a job in this industry for you.
Source: Meatbusiness