It was more than two years ago that leading baking organizations made a considerable investment to better understand a workforce gap posing a worsening threat across the baking industry.
A study commissioned by the American Bakers Association and the American Society of Baking and conducted by Cypress Research showed that more than three quarters of bakers were facing a high shortage or severe shortage of hourly skilled maintenance/engineering workers. The study, “The Workforce Gap in U.S. Commercial Baking: Trends, Challenges and Solutions,” indicated that machine operators and salaried engineering/maintenance employees were categories bakers cited as being of serious concern. Problems were exacerbated by a lack of formal training for workers combined with a rising bar for skills required in connection with ever advancing baking production technology.
The current national labor backdrop has not become any more favorable in the two years since the study was conducted. During this period, the U.S. unemployment rate dipped from an already low 5 per cent in April 2016 to an extraordinarily low 4.1 per cent in March 2018. For historical perspective, the jobless rate has been lower than 4.1 per cent in only 11 months since 1980 out of 460 and has averaged more than 6.3 per cent.
Recent data from the National Federation of Independent Business emphasizes the point that across the economy, the problems identified two years ago by bakers have worsened. Respondents to the group’s survey indicated that finding qualified workers is the top issue facing small business owners, eclipsing taxes, sales trends or the cost of regulations. Nearly 90 per cent of respondents who are hiring or trying to hire indicated finding few or no qualified applicants. Meanwhile, the group’s data showed small business owners indicating historically high job creation plans, rising 2 points in April to 20 per cent. The percentage of employers planning to raise compensation to help attract workers has climbed to the highest levels since 2000.
For grain-based foods, the problem is compounded by a workforce perception that baking plant positions are less attractive than many other manufacturing jobs, particularly to the millennial generation. And the demographic trends underlying the problem to begin with march steadily and unfavorably forward.
Since the Cypress study was released, each of the baking industry’s leading organizations have launched training programs to narrow the workforce gap. While the industry deserves great credit for proactively identifying the problem and taking important steps, no one in baking would say the shortages identified in 2016 have been satisfactorily reversed. To the contrary, baker concerns about labor issues are as great as ever (though the industry does not rank the problem as high a priority as the National Federation of Independent Business).
In addition to training, recommendations emanating from the 2016 study included employer strategies to foster a positive workplace environment, employer branding and stepped-up outreach to high schools, technical schools, community colleges and four-year colleges about careers in bakery manufacturing.
Many other potential solutions have been identified, including expanded steps focused on recruiting (e.g., targeting underutilized or new talent pools such as women, military veterans and millennials). Additionally, not all training programs are created equal, and less reliance on “shadowing and observing others,” one of the most popular training “solutions,” has been recommended. Finally, companies need to take robust steps addressing, whenever possible, prominent retention-related challenges. These include difficult working hours/shifts; understaffing on the production floor; untrained supervisors and a challenging manufacturing environment.
At the annual meeting of the A.B.A. last week in Phoenix, finding ways to attract and retain skilled workers was on the minds of bakers in attendance with the issue cropping up in numerous presentations. To truly make progress or to avoid backsliding, pro forma steps alone will not achieve desired results. Looking for near-term cost savings by deferring aggressive efforts to recruit and retain talented workers would be the height of short sightedness.