Report reveals untapped productivity potential of UK F&D industry

A new industry wide report has highlighted key growth opportunities for the UK food and drink sector.

The Food and Drink Federation (FDF) commissioned report by Grant Thornton also explores the obstacles the industry faces, the unique geographical spread of the sector and its importance to the wider UK economy. In addition, the findings reveal the extent to which exiting the EU may threaten the industry’s future productivity should the sector not receive further support from the government to help manage the transition.

Key findings include:

Skills

  • There is still great uncertainty regarding future access to EU workers, who are highly valued and make up 32.5% of the industry’s skilled and high skilled workforce
  • Despite misconceptions, there is an even mix of skills within the sector – less than 9% of roles are low skilled
  • 40,000 of the industry’s ageing workforce are expected to retire in the next 10 years. 140,000 new workers are required by 2024 to fill the looming skills gap.

Trade

  • Between 2006 and 2015 global food exports had a combined annual growth rate of 7%. During the same period UK food and drink exports grew by 4%
  • EU nations Ireland, France, the Netherlands and Germany were noted as key trading partners and the EEA remains the market with the greatest perceived potential for the industry
  • China, India and the UAE are seen as the top three markets that businesses surveyed would like to target.

Innovation

  • 89% of respondents are involved in new product development with many manufacturers engaged in long term calorie reduction programmes
  • Just 54% of manufacturers surveyed had accessed government R&D tax credits, which are not seen as a whole industry innovation solution
  • Nearly half of respondents (46%) are involved in an ongoing collaboration with higher education or research initiatives.

The report’s key recommendations for government include:

  • Work with education providers across the UK to increase availability of food and drink manufacturing specific apprenticeship training
  • Enhance the image of the food and drink industry and raise awareness of the range of career opportunities on offer
  • Prioritise food and drink as the UK’s largest manufacturing industry in relation to any new immigration policy
  • Work with industry to reduce product sugar levels and take an holistic approach to calorie reformulation
  • Further facilitate innovation through support for fundamental and applied research
  • Encourage more food and drink manufacturers to export to help grow the UK’s 2.2% share of the global food and drink export market
  • Work in partnership with industry to scale up its provision of specialist export support for food and drink and identify distributors in untapped markets.

Ian Wright, FDF director general, says, “This detailed report by Grant Thornton charts the future shape of our industry for many years to come. It is a welcome assessment of the significant opportunities available to boost the productivity of the food and drink industry at a time of great economic uncertainty.

“The issues facing the food and drink industry are complex, but if we find the right solutions there is great reward – not just for our sector and the wider economy.

“We believe a new sector deal, working in partnership with government and the farm to fork supply chain, will harness this potential.”

Read the report here.

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