Australian food industry hit by Covid19 labour shortages

The year 2022 has begun with a surge in Covid19 cases nationwide following the opening of state borders in the lead-up to Christmas and New Year’s. Opening borders coincided with the emergence of the new fast-moving Omicron variant of the coronavirus and as people socialised and gathered throughout the festive season, the new Omicron strain prospered.

Many Victorians have either contracted the virus or come into close contact with an infected person, requiring them to isolate for 7 days. This has resulted in widespread staff shortages which have put pressure on the food supply chain. A lack of rapid antigen tests and long queues at public testing centers has made it difficult for symptomatic workers to get tested, which has added an extra delay and further compounded the issue.

The fresh produce industry deals with perishable products that require an effective, fast-moving supply chain to ensure produce is processed in a time-sensitive manner. Since all stages in the supply chain are strongly connected, any disruption can create a domino effect and impact output. The dramatic reduction in workers has significantly disrupted the supply chain, meaning produce is not being moved as quickly as it should and is therefore having a flow-on effect down the chain. Lack of staff has meant growers are facing rotting produce as goods aren’t making it to the market and there are distribution issues due to transport and distribution sectors being particularly affected by labour absences.

Grant Nichol, Chief Wholesale Trading Officer at Flavorite, commented on the disruptions to the business “In our farming operations we’ve got four farms. Our Warragal farm employs 4oo people, and in the last few days we’ve had 130 people away with Covid and at our Mansfield farm we’ve had 42 away. We’re looking at taking measures at reducing some of the things that we do like reducing pre-packed lines and just selling more bulk lines as well as reducing crop sizes because we just physically don’t have enough people to do the work.”

The labour shortage has also resulted in staff working longer hours and being redeployed to assist in other areas of business, adding extra pressure to an already tense environment. This situation comes off the back of labour shortages rocking the agriculture industry in the last few years when travel restrictions imposed due to Covid19 shut out international labourers, who constitute a large section of the agriculture workforce in Australia.

To assist the food supply sector, the Victorian, NSW and Queensland governments announced isolation exemption measures for asymptomatic workers who are close contacts to be able to attend work if their employers deem them critical to the supply chain.

Healthy humans drive the economy, and the global pandemic has proved this. The recent surge in Covid19 cases and subsequent labour shortages has reminded us that people are the driving force behind production, distribution, and supply.