Food Processing
Executive Summary
The food processing sector is one of the most challenging to analyse because of its diversity and profile. The sector spans the whole spectrum of labour organisation from fundamental labour intensive production lines to high volume 'just in time' manufacturing, automated packaging and highly skilled labour providing engineering support. Purchasing power from the big 4 supermarkets continues to lead to “improvements” in delivery times, and freshness. In the Greater Cambridge area, as in many other parts of the country, these new pressures and opportunities have led to increasing merger and acquisition activity. This reflects the drive for economies of scale as well as the globalisation of the food economy.
Whilst it is easy to think in terms of a low skills equilibrium operating in the sector, on closer inspection one can equally make the case for large parts of the sector upskilling the workforce to a high standard – albeit a company standard rather than a national qualification standard. The level of skill in some large companies is clearly much greater than can be gleaned from looking at the sum of formal qualifications obtained by the workforce. This has obvious implications for the reported skills levels in this sector. The assertion that a low skills equilibrium accurately describes this sector then, is debatable. Whilst almost 50% of the workforce are deployed on production lines – the modern way of working (as evidenced in some of the larger companies) requires greater skill than older style work routines and the production line of today can resemble something more akin to a sequence of distinct processing operations, involving highly specialised computerised machinery, managed by skilled operatives, many of whom have developed multiple proficiencies across the 'shop floor'.
Food processing is the largest segment of the manufacturing sector in England and has an export value of £6.6bn. Cambridgeshire accounts for 14% of employment in the sector which in the East of England comprises 37,100 workers. Of these, 6,200 are non–UK nationals, almost 17% of the workforce. This reflects the amount of ESOL training which takes place in the sector especially among the larger food processing companies.
There are approximately 505 food manufacturing companies in the East of England and 680 business sites, according to ONS statistics (2009). Just over 180 companies operating in food manufacturing are based in Cambridgeshire. 97% of these have less than 250 employees and 110 (60%) operate from a single location, though almost 20% of these are subsidiaries of a larger company outside the county or region.
Acquisitions in the food sector have changed the ownership landscape in recent years. Many SMEs have been bought up by very large multinational companies to gain market share and economies of scale in their operations. The Food Processing sector is concentrated in north and eastern parts of the Greater Cambridge area. Wisbech might be seen as the ’capital’ food processing town, but there is a significant sector presence close to Ely, (G’s at Barway) Cambridge (Premier Foods – Histon), Peterborough (e.g. Produce World – Yaxley) and Bury St. Edmunds (e.g. British Sugar).
Most training is compliance related, which isn’t surprising given the onerous amount of food safety legislation and the need for extremely high standards of food hygiene required by the principal buyers – the powerful supermarket chains. However, it would be misleading to give the impression that food processing companies only train people to comply with outside pressures. In many companies there is a culture of training and development which pervades the organisation.
In the food processing sector there is an acute shortage of skilled meat boners and trimmers which may need to be met through targeted immigrant labour. This has led to a recommendation in October 2009, from the Migration Advisory Committee to add meat boners and trimmers to the “shortage occupation list”. Skills shortages can require specific intervention to ensure that a sector is able to recruit specific skills needs which are not easily available in the EU. In such examples, it is important to ensure that immigrant labour isn’t used to drive down labour prices at home.
Whilst this report shows a range of skills gaps extracted from research by the Sector Skills Council - Improve, some caution needs to be attached to their significance: The high volume research undertaken does not necessarily do justice to the intricacies of training needs analysis or to the individual interpretations put on the word “skill” or “need” by the company respondent. Moreover large companies with HR departments are much more likely to have gaps readily identified than small companies without such resources. This could be one reason for Improve’s surprising finding that larger companies are more likely to have skills gaps than small ones (see e.g. Skills Needs in the English Regions 2007 page 74)
The case studies in this report have illustrated some very good practice in terms of staff development. This is reinforced by the extremely low staff turnover evident in some companies (e.g. Premier Foods in Histon), and some excellent examples of training initiatives which could be built on to develop a ’dispersed’ Centre of Training Excellence in the sub–region.
In terms of provision, the Greater Cambridge area has the potential to make a significant difference to businesses by bringing together all the different training elements under one virtual academy. This could harness the enthusiasm and resources of employers already leading the way in training and hopefully encourage others to join in. The National Skills Academy directory could be replicated in the region so that employers (and employees) know what courses are on where, allowing providers to achieve greater economies of scale in scheduling courses in the area.
The National Centre for Food Manufacturing at Holbeach in Lincolnshire could provide some best practice support for such an initiative, working with universities and colleges in the East of England.
Recommendations
- Look at possibilities for a dispersed centre of excellence: Hub & spoke – lots of different sites and involving the private sector (e.g. G’s; Premier Foods and Produce World – all willing).
- Identify good practice by highlighting the work of larger companies and attempting to link up smaller businesses though the Centre of Excellence idea (above).
- Link up with the Sector Skills Council &ndash Improve – to provide consistent information on qualifications available in the sector – and promoting the benefits of developing the workforce (through the qualifications route).
- Increase opportunities for short taster courses available as feeders into mainstream provision.
- Publish, on–line in one place, information about courses possibly using the 21 categories identified by Improve.
- Work with Improve and local colleges to raise perceptions about the industry – what it means to work for different employers in the region – possibly showcasing several "best practice" companies at Further Education open days.
