Good afternoon.
My name is Kathleen Sullivan and I am the CEO of Food and Beverage Canada, representing Canada’s domestic food and beverage manufacturing sector.
I am also co-chair of Agriculture and Agri-Food Canada’s Food Sector Network and, with the Canadian Federation of Agriculture and the Canadian Agriculture Human Resource Council, am co-chairing a project to develop a workforce strategic plan for Canada’s agriculture and food and beverage manufacturing sectors.
I appreciate the opportunity to meet with you.
Canada’s food system is the foundation of this country’s national food sovereignty. Our food system contributes to Canada’s national, provincial, territorial and regional economies, it supports our international trade goals and it underpins local food production and food security, but the food system is a complex supply chain connecting almost 200,000 farms, 8,000 food and beverage manufacturers, 15,000 retail stores and 100,000 restaurants, all working together and with input suppliers and the transportation sector to ensure Canadians have the food they need.
Over the past two years, Canada’s food supply chain has been under inordinate and destabilizing pressure. Today, more than 90% of Canadian food companies are experiencing supply chain issues.
The reasons are complex. They include disruptions in global supply chains due to the pandemic, price inflation, natural disasters and transportation infrastructure disruptions.
For food and beverage manufacturing, the sector I represent, the number one overriding issue is labour. Food and beverage is the largest manufacturing employer in the country, but today, on average, Canadian food and beverage manufacturers are short 25% of their workforce. That is an absolutely staggering figure. The labour shortage has resulted, we estimate, in a more than 20% reduction in output. That means 20% less Canadian food available to feed Canadians or to export.
The impacts of the labour crisis are real. They are felt across all products, company sizes and regions. Here are just a few examples.
In Pointe-Claire, Quebec, LUDA Foods is a mid-sized processor that makes soups, sauces and custom blends for the food service and industrial markets. At full capacity, it has 80 employees but today has open postings for 20% of its workforce. The company’s fill rate for orders is now between 70% to 80% only, and the company is losing sales.
In Winnipeg, Medallion Milk has experienced labour shortages throughout the pandemic, specifically in the production area, averaging a 20% vacancy rate for production jobs. Really importantly, we have to remember the stress that puts on the remaining employees.
Olymel, one of Canada’s largest meat processors, with plants in Quebec, Alberta, Ontario and New Brunswick, reported in the media last fall that it needs 3,000 workers. Olymel announced it will stop slaughtering activities at its plant in Princeville, Quebec, starting next March, due to its labour shortfall.
In Brampton, Ontario, Maple Lodge Farms, Canada’s largest independent chicken processor, is operating with a 25% labour shortage. The facility has made substantial changes in product offerings. It has added overtime, and that places even more demands on the employees, who are already experiencing burnout due to the pandemic.
These are just some of the stories we have heard and continue to hear from companies across the country. It is our full expectation that these labour shortages will exist even after the pandemic comes to an end and likely will become worse. As an example, and like many other companies, at Maple Lodge Farms a further quarter of that company’s workforce will reach the age of 65 in the next five years. That means a level of turnover that has never been seen in the company’s history.
We recognize and we very much welcome recent commitments from the federal and provincial governments to help address labour issues, including the $85 million in additional resources recently announced to assist in processing times at IRCC. The problem, though, is that these these initiatives will take time to roll out, and they will not provide the relief that is needed in the immediate term.
We were also very pleased to see that Minister Bibeau's and Minister Qualtrough's mandate letters acknowledged the need to focus on labour and to prioritize the development of a labour strategy to address the chronic shortages in the agriculture and food-processing sectors.
Industry has in fact already stepped forward to play a leadership role in developing that strategy.
Last fall, the Canadian Agricultural Human Resource Council, the Canadian Federation of Agriculture and my organization launched a project to develop a workforce strategic plan for our sectors to address our chronic labour problems. This project, started last fall, is already under way—