INDUSTRY EVOLUTION VS. TALENT ATTRACTION Obstacle 2. Capabilities
Making the business case Business cases for investment look very different in other advanced manufacturing sectors such as aerospace and automotive because organisations are delivering a small number of very high value items making technical innovation easy to link back to value.
In food and drink, while marginal gains may be small individually, they accumulate across large volumes, resulting in significant overall savings that, although complex to model and track, contribute to substantial returns.
A third of senior leaders who took part in the research admit the biggest issue holding back digital and AI solutions is the lack of skilled labour to even identify the scope for such work. Attracting highly skilled talent, especially outside London where most food and drink manufacturing takes place, is a struggle. At the moment, the proportion of employees in food and drink manufacturing lacking key skills is 11.8% – more than twice the national average of 5.7% 12 , and higher than all but one other manufacturing subsector. Labour and skills shortages continue to hold back growth and productivity with an estimated loss of £1 billion in output in 2023 due to these shortages 13 . There are many interconnected reasons behind the challenges facing talent attraction in food and drink manufacturing. Almost a third of the food and drink manufacturing workforce is estimated to reach retirement age by 2033-35 14 . Replacing more experienced parts of the workforce can be difficult as new talent isn’t fully aware of the meaningful, long-term career opportunities available in the sector. As a result, other advanced manufacturing sectors are gaining the upper hand in recruiting domestic talent in engineering and science.
A post-Covid shift in work expectations also plays a role. Many professionals now expect remote work options, but most fast-moving consumer goods (FMCG) sites require on-site presence, often in remote locations. These settings can be less attractive to new graduates eager to start their careers in urban areas. The geographic spread of the industry also makes it difficult to upskill as it can be challenging to form sufficient apprentice cohorts to sustain consistent, high-quality training. Additionally, there’s a significant gap in salary expectations between the UK and other markets, particularly the US. Concerns are growing that recent budget changes may make it even harder for UK businesses to remain competitive in attracting and retaining skilled talent. It becomes a Catch-22: businesses must allocate extra resources to attracting and recruiting the right people, diverting budget from innovative tech and digital where these people would do their best work. Some businesses end up focusing instead on low-cost, labour-intensive technologies 15 . This dichotomy is brought to life starkly in one particular business who contributed to the research. It’s harder to recruit people into one of its factories so automation has been ramped up there to meet demand. This has also meant investment has had to be put on the backburner at its other site.
While a challenging situation, industry research clearly shows that investment in food and drink manufacturing offers strong returns. As explored in the vanishing horizons section of the report, making a successful business case in this sector is more than possible by focusing on real, tangible business outcomes.
12. 13.
Department for Education, Employer Skills Survey (2022)
FDF State of Industry Survey, Q1 (2024)
14. Food and Drink Sector Council: Preparing for A Changing Workforce (2019) 15. Lloyd, Caroline, Payne Jonathan, Food for thought: Robots, jobs and skills in food and drink processing in Norway and the UK, New Technology, Work and Employment (2021)
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