ST. LOUIS — Amid low unemployment rates, new facilities coming online and a shrinking pool of available labor, some meat processing facilities are struggling to keep doors open and conveyor belts moving.
RaboResearch animal protein analyst Christine McCracken says that when meat processing reaches its typical peak this fall, not having all facilities running at full capacity may cause an over-supply of live animals for the market.
For livestock producers, that situation could translate into lower market prices, she says in a company news release.
“At the moment, the pork industry is seeing a tighter supply of workers in its processing sector. This reflects not only very low national unemployment rates but also the recent addition of four new slaughter plants in relatively rural areas with even tighter labor supplies,” McCracken says.
A recent RaboResearch report explores the employment challenges for the meat processing industry and weighs possible solutions. Long-term fixes may include integrating more automation, moving facility locations to areas with more abundant labor pools, or developing more attractive employee and workplace benefits. But in the short term, companies are struggling to recruit and retain workers.
“As packers compete for the same workers, we have seen turnover increase by as much as 50 percent in the past year,” McCracken says.
In juxtaposition to the employment woes of the meat processing industry, U.S. farmers have increased animal production by 8 percent over the last two years in anticipation of continued growth in consumer and export demand.
“There will be winners and losers in companies’ abilities to recruit and retain workers, automate and adapt supply chains,” McCracken says. “In the short-term, the entire supply chain — including pork and poultry producers — will feel the pinch economically.”