Animal Protein's Labor Pains: Industry Bottleneck or Game-Changer?

A tight labor environment will create winners and losers in the animal protein sector – companies will differ with regard to their ability to recruit and retain workers, the ability to automate, and the flexibility to adapt supply chains.

Picture of butchers at work

Wages have been slow to adjust, while efforts to boost hourly rates have had limited success in reducing turnover. Reinvestment in the work force is imperative. Efforts to improve working conditions and invest in local infrastructure are expected to pay big dividends in recruiting and retaining workers.

Productivity losses associated with automation have dropped, yet benefits vary by species. Integrating new technologies is likely to be the best long-term solution but is not a quick process, especially given equipment backlogs. 

U.S. processors may ultimately choose to move high-cost processing to low-cost labor markets and/or consolidate plants – forcing structural change across the entire protein supply chain.