Last Friday’s jobs report brought good news for the food manufacturing industry and a potential signal that surging food costs may begin to temper.
The food manufacturing industry added 8,300 non-supervisory and production jobs in September representing a monthly increase of 0.6% and an increase of 4.0% from a year ago. The increase comes in the same month that hourly wages dipped by 0.5% from the previous month even as non-supervisory and production workers saw wages increase by 0.3%. September’s dip in hourly wages was the first time this class of food manufacturing worker had a monthly decrease since October 2020.
The labor force disruption caused by COVID-19 took a significant toll on the food and beverage industry and contributed to the inflation consumers are seeing now in the grocery aisles. The exodus of low-wage employees from the industry during the pandemic compounded shortages already heightened by robust household demand. Food manufacturers brought employees back at a significant cost, raising wages as much as 8.3% year over year. Those wage increases are also now making their way to the prices consumers see. But if September’s trend continues, added jobs and lower wages on the horizon could soon counter higher food costs.
The takeaway
Low-wage workers have played an important component in the food and beverage production ecosystem. Manufacturers’ ability to maintain and grow their workforce with sustainable wages will be imperative to their own viability as well as slowing the rate of food inflation. Food and beverage manufacturers should continue to invest in creative employee benefits, better working conditions and labor-enabling technology to enhance their workforces and grow productivity.
