Written Evidence submitted by The Western Fish Producers’ Organisation, More Seafood Ltd, Falfish Ltd, Whitelink Seafood Ltd, Seafood and Eat It, Brixham Trawler Agents (LS0044)
- What is the extent and nature of labour shortages currently being experienced in the food supply chain?
- These responses represent the opinions of four seafood processing businesses, a fish market and 25 offshore vessels in the fishing industry.
- There is a severe and desperate shortage of labour across food production sites, causing huge problems for seafood processors right now. The shortage comes both from a lack of skilled and unskilled workers and new entrants into the onshore fish and shellfish processing sector. Processors are 20-40% down on staff and have been recruiting this number of staff for the past 6 months. Across the four processors and fish market this amounts to 76 vacancies. Businesses are concerned that they are not able to employ people with the skills and work ethic of before.
- Lack of reliable workers available across the manual labour workforce means the fish industry is competing with other industries to secure labour e.g., hospitality, building, agriculture, meat production. There are now so many jobs available that employers are having to offer much more money than they would have done a year ago, which affects the economics of the businesses. Night shift staff are very difficult to source now, businesses have had to increase pay rates to attract people. Brixham fish market was looking for 6 nightshift staff for 2 months, current staff were covering by working more hours, but everyone suffered. They have now recruited staff but have had to increase the pay to compete with supermarkets and others.
- The shortage of labour is the limiting factor in productivity and is halving the amount of product that can currently be processed, this is halving profitability. Companies are missing out on growth opportunities in sales due to decreased productivity. For example, on 15.10.20 Brixham Fish Market was told by three of its main scallop buyers that they would not be buying any scallops until the staffing situation is sorted because they do not have enough staff to process the scallops. This massively decreases the demand for scallops and therefore the price will be depressed. The labour shortage is now affecting the profitability of not just the processors but the vessels and the auction too.
- What are the factors driving labour shortages in the food supply chain?
- There is a lack of access to foreign workers. Many went home at start of covid and have not returned. Some Eastern European workers that are entitled to be in the UK have returned to Eastern Europe or many have gone to Holland to work in factories or healthcare, because they fear the stability of being allowed to stay in the UK.
- There is an aging workforce in the fish and seafood industry. There is a lack of young domestic workers willing to do the work as it seems that attitudes to work has changed.
- Unemployed people would rather stay unemployed and live off welfare benefits then have jobs in food factories. Many feel they are better off on welfare benefits. Some do not wish to work more than certain number of hours per week for risk of losing benefits.
- Poor health and living conditions of workers from generational low-income households leads to high levels of alcohol and drug abuse, sickness and poor nutrition contributing to regular absence due to sickness.
- The cost of living in the southwest is prohibitive for workers willing to relocate from other areas. There is a severe lack of rental properties available as many have been let out for holiday lets or sold during post covid housing boom in Cornwall. House and rental prices have risen on average 25-30% in Cornwall in last 18 months. Wages remain stagnant.
- Poor perception of factory work for school leavers. Factory work is associated with low pay, poor conditions, and prospects, even though they could earn £20 per hour on piece rate.
- The Furlough scheme has had detrimental effect because people were getting was money for nothing.
- What is the outlook for the labour shortage situation in the coming months and years?
The general opinion is that the outlook is bleak. Unless workers from Eastern Europe are incentivised to return, the situation will not improve.
Fish processors now are having to go down the visa sponsorship route to get people from India to come to the UK on visa contracts. This increases the costs to the company, the minimum hourly rate with all costs is £13.5 per hour. In total it will cost £10k in administration costs. It is not cheap labour, and it is more time consuming. On top of this the company must assist with accommodation and might be forced to buy property to make sure there is adequate accommodation because of a lack of rental properties in the southwest.
- What other issues are affecting the food supply chain?
- There are increasing costs associated with transport, and packaging costs have increased.
- There have also been difficulties with fuel deliveries due to lack of delivery drivers. Fuel is critical for the fishing vessels to be able to go to sea, and for the lorries to transport the fish. Brixham market had to source fuel elsewhere at much greater cost.
- There has been a shortage of crew for fishing vessels since before Brexit but has been exacerbated by Brexit. The transit visa that allows the recruitment of crew from, for example, the Philippines, only allows the vessel to work outside of 12 nautical miles from the shore. This means that inshore vessels who also struggle for crew, cannot use this method of employment. Fishing crew have recently been given ‘skilled worker’ status which allows inshore vessels to employ foreign crew on a skilled worker visa, however this route is double the cost over the transit visa route due to the minimum salary requirement on an inshore vessel which is limited in its fishing days by weather. A business represented in this response has been incentivised to buy a bigger vessel purely for the reason of being able to employ people with a transit visa rather than a skilled worker visa. This has knock-on impacts on the sustainability of as a bigger vessel can catch more fish, as they target non-quota species.
- What impact will the timetable for introducing physical checks at the border on food and live animal imports from the EU have on the current issues being experienced by the UK food supply chain?
None of the companies represented here import food, they are all exporters.
- What measures has the Government taken to alleviate the problems being faced by the food supply chain this year? To what extent have they been successful?
All companies feel that the government has not done much this year to alleviate the labour problems. In seafood, we are dealing with perishable product, so could not use furlough scheme, we had to process the product and worry about margins later.
- Does the Government need to take further steps to support the food supply chain?
The government needs to incentivise the UK workforce to go back to work and incentivise people to come back from Europe. There could be a food supply chain visa that is easier and cheaper for employers. The skilled worker visa for fishing crew should be made more appropriate for inshore vessels.