FOOD and BEVERAGE | AGENT RESOURCE
What to expect with trade, employment, innovation and more
For food and beverage manufacturers, their main focus is on packaged food, and less on fresh meat and produce. Specifically, packaged food can include pasta, canned fruits and vegetables, baked goods, cereals, condiments, frozen foods and snacks, among others. Often, when preparing these goods, businesses will start with fresh food and then process it, most often by cutting, seasoning, flavoring, cooking, freezing and packaging it.
Generally, the size of the manufacturer will range from a small, manual operation with few employees to a large, international organization that uses highly automated plants across multiple locations. In addition to production lines, food manufacturers will typically have significant storage and warehousing needs. This may include a cooler or freezer for housing raw goods or finished products. Finished products will be transported to a distributor or a final customer.
For beverage manufacturers — which are also referred to as bottlers — their focus is often on nonalcoholic drinks such as soda, juice and water. These goods can be packaged in glass bottles, aluminum cans, plastic bottles or similar containers. Bottlers may make their own beverages or have a franchise contract to manufacture certain brands of beverages.
Food and beverage manufacturers consist of many industry groups, including but not limited to the following1:
Of the various industries, food manufacturers have been especially impacted by trade disruptions.3 American tariffs on imported materials such as steel and aluminum have resulted in retaliatory tariffs on U.S. food exports. These tariffs have resulted in lower sales and profits for food and beverage manufacturers.
The tariffs have also affected imported food and beverage products, as many manufacturers depend on aluminum and steel for their packaging. In the face of tariffs on these materials, increased import costs are passed on to domestic businesses by aluminum can and other packaging manufacturers.4
As of July 2020, the unemployment rate in food and beverage manufacturing was 8.7% compared with 10.2% for all other industries.1
Like many industries, food and beverage manufacturers are dealing with significant worker shortages. There are many reasons for this, but trends that affect manufacturing — including the aging workforce — are significant contributors.3 Many employees are retiring, and businesses are having difficulty recruiting younger workers. Recruiting is particularly challenging when it comes to finding skilled technical workers, such as maintenance workers and technicians who run and maintain automated equipment.
As a result of recruiting challenges, more companies are being forced to get creative with their hiring and onboarding practices. Many have invested significant time and money into training programs to ensure that new, inexperienced workers have the education and skills necessary to complete their jobs safely.
Additionally, food and beverage manufacturing is historically a low-margin industry that struggles with rising wages. The industry has also traditionally relied on immigrants when it comes to filling vacant roles. However, continued immigration issues are impacting the industry’s ability to secure talent.