Labour shortages in dairy sector fuelling inflationary pressures, Arla warns

Leading dairy cooperative Arla Foods has on Thursday warned that a chronic shortage of suitably-qualified farm workers is already reducing production of dairy products and contributing to food price inflation.

The company warned that the situation will get worse unless urgent action is taken to attract new talent into farming.

According to a survey of Arla farmers in the UK, 80 per cent of them looking for workers have received ‘very few’ or ‘zero’ applications from people with the right experience or qualifications. A combination of the end of free movement of workers from the EU, the aftermath of the pandemic, and a host of other factors mean that more than three-fifths (61.3%) of farmers are finding it more difficult to recruit now than in 2019.

The shortage of people is already affecting production, the company noted, with milk volumes are down by around three percent now compared to last year.

In Arla’s survey, a small but significant number of farmers say they have already reduced output by cutting the number of milkings (4.3%) and/or reduced the size of their herd (6.0%) due to staff shortages. Many more say they will take these steps (6.9% and 6.8% respectively) or leave farming altogether (11.9%) in the next year if nothing changes.

Arla said a multi-faceted response to the shortages is urgently required, adding that it has called consistently for specialist roles like herd manager to be added to the Shortage Occupation List in order to increase the size of the pool of available workers.

It has started to engage with the new Institute of Agriculture and Horticulture and fully supports the focus on improved skills and qualifications for farm workers, as well as recruitment into the industry. But it added that the government needs to go further.

“Addressing the labour shortage and the implications this could have for food security is vitally important. Now is the time for all of us, across government and industry, to work urgently and collaboratively to shift outdated misconceptions about farming and bring new talent into the industry,” Ash Amirahmadi, Arla’s UK managing director, said.

“That’s why I’ve written to the Secretary of State today calling on him to accelerate the review of the labour market promised in the Food Strategy White Paper, and for him to commit to a new cross-departmental strategy to bring talent into food and farming, making it a career of choice for people from all backgrounds. This will need to include on-farm skills and training, but will also address teaching in schools, the understanding and attitudes of careers advice providers, support for people wanting to change career, and a marketing campaign aimed at promoting careers in our industry.

“If we don’t act now the current shortages of people will only get worse, jeopardising production on farms, undermining our food security and further fuelling higher prices for consumers.”