Dr. Sylvain Charlebois/Professor/Professeur Titulaire
Job numbers are better. For the agri-food sector though, not so much.
Statistics Canada’s recent September job market data is reassuring. Overall, employment in the country increased in September, creating 378,000 jobs, the majority of which were full-time jobs. This increase in September brought our total employment to 720,000, shy of the level we had before the pandemic. Obviously, children being back to school has helped bring some normalcy to our lives. And for the economy, that is a very encouraging sign.
On the other hand, for the agri-food sector, the reality is quite different. The agricultural sector is hiring far fewer people than at this time last year. There are precisely 17,000 fewer jobs than in September 2019. Undoubtedly, recruitment has been particularly difficult, given the challenges getting foreign workers. But with public investment discussions between Ottawa and the provinces on more controlled-environment agriculture projects, seeing fewer jobs in the sector is to be expected. Our collective enthusiasm for greater food autonomy across the country is getting many to think about food security differently. Technology-driven models in agriculture will control costs, and of course, limit the influence of the weather. As such, it will help consumers who are fleeing highly volatile prices, especially in produce. Right now, it is typical to see prices for certain vegetables and fruits rise by 25%, in only one month. The cauliflower incident a few years ago was exactly that. With more domestic high-tech production, this is less likely to happen. With 48% of the population concerned about food shortages, this would matter.
Other food sectors are also suffering. Although the hotel and restaurant sector has now reached the one million employee mark again, this sector still employs 15.2% fewer people than at this time last year. This is the largest drop amongst all sectors. With the second wave of the pandemic affecting several major regions, it is expected that the number of employees for these sectors will fall below one million in October, once again. But the resilience of hoteliers and restaurateurs is nothing short of impressive. Given the several blows the sector has had to endure, 15.2% is not much.
But the biggest problem is food processing. Across the country, companies are struggling to recruit. Estimates provided by Food and Beverage Canada and by the Conseil de la Transformation Alimentaire du Québec suggest that almost 28,000 jobs in food processing remain vacant in Canada right now. That is about 10% of all positions available in the entire sector. Indeed, the labor shortage in the sector is worse than it was before the pandemic, even with a higher unemployment rate. Understaffing forces many employers to reduce production and cut working hours. Some factories have unfortunately had to close some production lines. This explains, in part, the few almost empty shelves in some supermarkets and retail stores. Canada will not experience a food shortage any time soon, but our processing sector needs help, and fast.
The average hourly wage in the area is currently about $21 to $23, well above the minimum wage across the country. Working conditions, however, are not ideal. And during the first wave of COVID-19, several food processing and distribution plants were put to the test. Media coverage was overwhelming, focusing on closures and outbreaks within facilities, making the sector look much less attractive. The Cargill beef plant in High River experienced the largest outbreak in the country thus far. For recruitment, it was a public relations nightmare.
In addition, with the end of the Canadian Emergency Response Benefit (CERB) program and the new enhanced employment insurance program, recruitment appears to be even more challenging for the sector. Hundreds of work-ready Canadians are now opting to stay at home until the weeks of eligibility for the program run out. An anemic food manufacturing sector may mean that some products will be out-of-stock, from time to time, especially at the meat counter. And the situation could get worse.
Raising wages to make the sector more attractive is one option. With industry going it alone, that could add to the pressure that retail prices are under right now, at the risk of raising the price of food. A timely program would certainly incentivize Canadians to work in the sector. Perhaps willing Canadians wanting to work in the sector could get compensated while retaining a portion of their employment insurance for a while. A hybrid program of sort. Despite Ottawa’s good intentions to keep people at home and safe, CERB and now the new employment insurance program à la COVID, is not helping food manufacturing.
Food manufacturing is like no other sector. The labor shortage the sector is experiencing has the potential to become a food security nightmare.