Staff shortage in the UK sparks fears of food price rises

Wholesalers warn the national staff shortage of lorry drivers in the UK could lead to an increase in food prices.

One food supplier says the industry is facing a “perfect storm” of adverse effects. They are having to deal with both the impacts of Brexit and the coronavirus pandemic at the same time.

Darren Labbett, managing director of Woods Foodservice, says: “As we came out of lockdown, the demand for everything went through the roof overnight”. As an example, the cost of vegetable oil is at a 30 year high due to increased shipping costs and more demand.

Mr Labbett says that wholesalers are “trying our utmost” to absorb the additional costs rather than pass them on to consumers. “But we can’t absorb those price increases forever,” he adds.

The Federation of Wholesale Distributors represents about 600 companies in the wholesale sector. Its chief executive, David Bielby, says there are “chronic” staff shortages throughout the whole food and drink supply chain. He estimates there are up to half a million job vacancies. In order to retain and recruit staff, businesses are having to offer incentives, resulting in increased costs for them. This is across all areas, including growers, manufacturers and wholesalers. Mr Bielby says that under the circumstances, it is “inevitable” that some cost increases will pass through the supply chain, ultimately leading to “food price inflation”.

Pushing up prices

The shortage of lorry drivers is causing serious supply issues for many companies, who continue to complain about the detrimental effect it is having on their business.

Industry bodies estimate a shortfall of around 100,000 drivers, caused by a number of contributing factors. This includes the Covid pandemic, Brexit and tax changes leading to a lack of qualified drivers.

UK food manufacturing is currently under severe strain due to all of the worker shortages, meaning some production may have to move to another country.

However, wholesalers claim there are several other things that threaten to push prices up.

A London based fruit and vegetable importer and wholesaler blames Brexit as the biggest cause of extra business costs. The firm operate shipments out of Milan two times every week. The paperwork alone for this is adding costs of €52,000 (£44,650) a year. But Covid is also having an impact too. Growers around Europe are all affected by shortages in labour, meaning a reduced number of goods being picked for delivery. Plus, this year’s bad weather as reduced the yields of some crops.

Comparing food prices from August 2020 to August this year, data from the Department for Environment, Food and Rural Affairs shows a number of items have gone up in price. This includes leeks, onions, turnips, beetroot and tomatoes. As an example, tomatoes costing £0.75 per kg last year will now set you back £1.47 for the same amount. However, figures do show a reduction in the price from 2020 to this year of conference pears and carrots.

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