Food and beverage workforce issues paper

ISBN 978-1-921916-06-9 (online pdf and word docs)© Commonwealth of Australia 2013This work is copyright. Apart from any use as permitted under the Copyright Act 1968, no part may be reproduced by any process without prior written permission from the Commonwealth.Requests and inquiries concerning reproduction and rights should be addressed to the Department of Industry, Innovation, Science, Research and Tertiary Education, GPO Box 9839, Canberra ACT 2601.

Disclaimer: The material contained in this paper has been developed by the Australian Workforce and Productivity Agency. The views and recommendations do not necessarily reflect the views of the Australian Government, or indicate its commitment to a particular course of action. The Australian Government and the Australian Workforce and Productivity Agency do not guarantee or accept any legal liability or responsibility for the accuracy, completeness, or usefulness of any information disclosed.The Australia Government recommends that users exercise their own skill and care with respect to their use of this paper and that users carefully evaluate the accuracy, completeness and relevance of the material in the paper for their purposes and where necessary obtain any appropriate professional advice relevant to their particular circumstances.

The paper can be accessed at www.awpa.gov.au.

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Contents

Contents 2

List of tables 3

List of figures 4

Glossary and acronyms 5

Executive summary 8The current and future workforce 8Growth opportunities 10What are the implications for skills and workforce development? 11

Introduction 13Scope of AWPA’s food and beverage workforce study 14Overview of this Issues Paper 15

Part 1: Economic overview of the sector 16Structure of the food production and processing sector 18

Part 2: Environmental scan 20Demographics 20Opportunities arising from the Asian century 22Restructuring of the industry 25Technology 26Human capital and the imperative to upskill 28

Part 3: Skills supply and demand analysis 31Overview of food industry employment data 31Occupational analysis 35AWPA medium-term employment projection modelling to 2025 38Overview of food workforce skills demand 41Supply of skills to the industry 47Boosting supply through workforce participation strategies 58

Part 4: Supply and demand imbalances 61AWPA’s approach to assessing skill imbalances 61Assessment of Manager and Professional occupations 61Assessment of Technicians and Trade occupations 64Assessment of Labourer occupations 66

Part 5: Workforce development: What’s working? 70AWPA’s approach to workforce development 70Initiatives to address food and beverage workforce development 70A coordinated approach to workforce development 72Australian Government skills and workforce development initiatives 73

Part 6: How to provide feedback on this Issues Paper 76

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List of tablesTable 1: Employment growth and projections for food related sectors within the Agriculture,

Forestry and Fishing industry 34Table 1: Employment growth and projections for food related sectors within the Agriculture,

Forestry and Fishing industry 34Table 2: Employment growth and projections for food related sectors within the Manufacturing

industry 36Table 3: Occupational employment numbers, historical growth and projections 38Table 4: Projected change in number employed by food related sectors, 2011to 2025, AWPA scenarios 41Table 5: Projected change in number employed by food workforce occupations 2011 to 2025,

AWPA scenarios 42Table 6: Comparison of qualification profile for the Agriculture and Fishing sector and all-industries

between 2006 and 2011 (Census data) 44Table 7: Census 2011, qualification profile of top 30 employing occupations in the Agriculture

and Fishing sectors 45Table 8: Comparison of qualification profile for the Food and Beverage Manufacturing sector

and all-industries between the 2006 and 2011 (Census data) 47Table 9: Census 2011, qualification profile of top 30 employing occupations in the Food and

Beverage Manufacturing sectorsTable 10: VET students enrolled in selected food related training packages managed by the

AgriFood Industry Skills Council 50Table 11: VET student completions in selected food related training packages managed by the

AgriFood Industry Skills Council 52Table 12: Apprentice and trainee commencements in selected food related training packages

managed by the AgriFood Industry Skills Council, twelve months ending September 53Table 13: Occupation of VET students employed six months after training by Field of Education,

2007–2012 54Table 14: Higher education domestic commencements in directly food related Fields of Education,

2011 55Table 15: Higher education domestic completions in directly food related Fields of Education,

2011 57Table 16: Student outcomes, Agriculture bachelor degree graduates 2012 58Table 17: Key employment and skill shortage trends: Food workforce Manager and Professional

occupations 69Table 18: Key employment and skill shortage trends: Food workforce Technician and Trade

occupations 71Table 19: Top employing Labourer occupations: Agriculture and Fishing 72Table 20: Top employing Labourer occupations: Food and Beverage Manufacturing

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List of figuresFigure 1: Overview of Australia’s food supply chain and its dependencies 15Figure 2: Value chain for food in Australia 2011–2012 17Figure 3: Age distribution of workers (percentage terms) in food related sectors and

all-industries 2012 22Figure 4: Asian food imports to 2050: Real value by commodity group 25Figure 5: Total food related Field of Education undergraduate and postgraduate

commencements 2006–2011 56

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Glossary and acronyms457 Visas Section 457 of the Migration Act 1958 (Commonwealth)

ABARES Australian Bureau of Agricultural and Resource Economics and Sciences

ABS Australian Bureau of Statistics

ACCC Australian Competition and Consumer Commission

AFI Australian Farm Institute

Agricultural production

Those industry sub-divisions involved with direct production including growing or harvesting of food.

AQF Australian Qualifications Framework

AWPA Australian Workforce and Productivity Agency

ANZSCO Australian and New Zealand Standard Classification of Occupations

ANZSIC Australian and New Zealand Standard Industrial Classification

AQIS Australian Quarantine and Inspection Service

ASEAN Association of South East Asian Nations

Attraction and retention

Attraction—policies and practices of a workplace or sector that evoke interest or are attractive to potential employees. Retention—policies and practices undertaken by the employer which increase the attractiveness of a workplace resulting in fewer employees leaving the business (lower turnover). Retention can also refer to strategies to retain workers within an industry sector, region or supply chain.

COAG Council of Australian Governments

Commodity

In line with ABARES publications, commodity refers to agricultural product that has been minimally or substantially transformed such as refined sugar and meat.

CP cold plasma

DAE Deloitte Access Economics

DAFF Department of Agriculture, Fisheries and Forestry

DEEWR Department of Education, Employment and Workplace Relations

DFAT Department of Foreign Affairs and Trade

DIISRTE Department of Industry, Innovation, Science, Research and Tertiary Education (Since April 2013 DIICCSRTE, incorporating climate change)

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eRTOs Enterprise Registered Training Organisation

ETGs elaborately transformed goods

EU European Union

EVAO estimated value of agricultural output

FAO Food and Agriculture Organization of the United Nations

FoE Field of Education

Food and beverage processing

Those industry sub-divisions involved with transforming raw ingredients into value added foods and beverages and other forms

Food supply chain

Consists of the production of agricultural and fisheries food materials and products, food and beverage processing and manufacturing, distribution, wholesaling and food and beverage retailing, food services, international trade (both exports and imports) and consumption.

Food workforce

Those working in industry sub-divisions that involve the direct production or processing of food and beverages.

FSANZ Food Standards Australia New Zealand

FTA free trade agreement

GCC Gulf Cooperation Council

GDP Gross Domestic Production

HHP high hydrostatic pressure

Human capital

The knowledge, skills, competencies and attributes embodied in individuals that facilitate the creation of personal, social and economic well-being.

IEP Indigenous Employment Program

LLN language, literacy and numeracy

NCVER National Centre for Vocational Education Research

NEST National Agribusiness Education, Skills and Labour Taskforce

NFF National Farmers’ Federation

NRAC National Rural Advisory Council

NRI National Regional Initiatives

NWDF National Workforce Development Fund

NWDS National Workforce Development Strategy

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OECD Organisation for Economic Co-operation and Development

PACER Plus

Pacific Trade and Economic Agreement

PEFs pulsed electric fields

PICSE Primary Industry Centre for Science Education

PIEF Primary Industries Education Foundation

RCEP Regional Comprehensive Economic Partnership Agreement

RD&E Research, Development and Extension. The research and development of new inventions and techniques. Extension refers to the process used to communicate the new research.

RDCs Research and Development Corporations

SME small and medium enterprise

SOL Skilled Occupation List

SpOl Specialised Occupation List

STGs substantially transformed goods

SWP Seasonal Worker Program

TAFE Technical and Further Education

TPP Trans-Pacific Partnership Agreement

VET Vocational Education and Training

VETiS VET in Schools

WELL Workplace English Language and Literacy Program

Workforce development

Providing knowledge and skills in tertiary education; matching tertiary provision to the needs of industry, individuals and society; using knowledge and skills effectively at work, and, further developing knowledge and skills in the workplace.

WFA Winemakers’ Federation of Australia

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Executive summaryAustralia’s food and beverage industry, encompassing agricultural production and food and beverage processing, employs more than half a million Australians and accounts for around four per cent of our nation’s Gross Domestic Product (GDP). The industry also contributes significantly to Australia’s export income, with exports valued at $30.5 billion in 2011–12 (representing 11.5 per cent of total merchandise trade). However, only a very small percentage of these exports are of elaborately transformed goods.While the total number of Australians employed across the industry has fallen in recent decades, the value of production has continued to rise, indicating productivity improvements. Productivity growth will need to be sustained if Australia is to take full advantage of the export opportunities afforded by the growing global demand for food (particularly from the emerging middle classes in Asia). The Australian Government’s 2012 Australia in the Asian century white paper sets out a strategic framework to guide Australia through the Asian century, and includes a vision for a globally competitive and innovative Australian agriculture and food processing sector. The Asian century white paper notes that opportunities to deliver high value-added products focused on customer demands in Asia are likely to expand. The report also notes that a highly skilled workforce will be required to make the most of these opportunities. It notes access to technology, a strong focus on service provision and deeper engagement with Asian customers in order to understand and meet their requirements will also be needed. The goals of the Asian century white paper will be reflected in the Australian Government’s forthcoming National Food Plan. In this plan the government will set out how our food and beverage industry can seize the opportunities of the Asian century, become a larger part of the national economy, provide rewarding careers for Australians and strengthen regional communities. The plan will encompass a range of policy areas that interact with the food system and will include goals for productivity, exports and skills to 2030. The Australian Workforce and Productivity Agency’s (AWPA) food and beverage workforce study focuses on skills policy to support the government’s National Food Plan.If Australia is to make the most of longer term opportunities arising from the Asian century, it is important to know where future demand is likely to occur and to put strategies in place which will ensure Australian producers and processors have the skills, knowledge and capabilities to meet this demand. Key skills which will be required in this context include: leadership, management, mentoring, risk management and the ability to translate research and development into business processes along the supply chain.

The current and future workforceAustralia’s food and beverage workforce comprises around 325,000 employees working in agricultural production, and a further 230,000 in food and beverage processing. The largest component sectors are: Sheep, Beef, Cattle and Grain Farming with 128,200 employees, Bakery Product Manufacturing (62,500), Meat and Meat Product Manufacturing (55,700), Fruit and Tree Nut Growing (30,700), Beverage Manufacturing (28,600) and Dairy Cattle Farming (25,000).Employment is spread across occupational categories from highly skilled to semi and low-skilled, including Managers, Professionals, Technicians and Trade Workers, and Labourers. The largest occupations in the sector are: Livestock Farmers (83,500), Crop Farmers (45,900), Garden and Nursery Labourers (33,900), Mixed Crop and Livestock Farmers (33,400), Livestock Farm Workers (31,300), Bakers and Pastrycooks (30,900) and Food and Drink Factory Workers (29,200).The average age of workers within the Agriculture, Forestry and Fishing sector is considerably older than the average across all industries, with almost one-quarter aged 60 years or over. For food processing, the age profile is skewed towards the younger age groups, with over

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40 per cent aged 34 years or under and only around 5 per cent aged 60 years and over.Levels of part-time employment and female employment vary significantly between the production and processing sectors and within each sector. The proportion employed part-time in 2012 ranged from 12.4 per cent in Meat and Meat Product Manufacturing to 51.5 per cent in Seafood Production. This compares with an all-industries average of just under 30 per cent. The industry (particularly agricultural production) is also characterised by a high level of casual, seasonal and contract labour, much of which is not captured in official employment statistics.In 2012, women accounted for just under 46 per cent of all workers in the Australian economy. Within the food and beverage industry, the proportion ranged from 9.7 per cent in Oil and Fat Manufacturing to 50.9 per cent in Bakery Product Manufacturing.The demographic make-up of the industry has implications for strategies aimed at attraction, retention and succession planning—in addition to the skills development strategies required to position the industry to maximise growth opportunities. This requires a workforce development approach that encompasses a range of strategies aimed at attracting, developing and maintaining a skilled workforce to meet future industry needs.The food and beverage workforce has a relatively low skills profile, compared with the average across all industries: within the agriculture and fishing workforce, just under 40 per cent of workers have completed a post-school qualification. Within food processing, the figure is 45 per cent. Both of these are significantly lower than the all-industries average of 62 per cent. While these figures are low, there has been a noticeable increase in the proportion of workers holding a post-school qualification between 2006 and 2011, particularly at higher qualification levels. This trend of skills deepening is expected to continue. Scenarios prepared by Deloitte Access Economics for AWPA’s Future focus, 2013 National Workforce Development Strategy all show that the proportion of workers with a post-school qualification is expected to increase in the years to 2025. The scenarios also show a general shift to higher level qualifications across the main employing occupations. These will need to be supplemented by short courses and skill sets to ensure skills keep pace with new technologies, and to promote a culture of lifelong learning. Employers will need to be convinced, however, that in an environment of low margins and high costs, there is a return on this investment.Looking at employment growth in the short to medium term (the next five years), the Department of Education, Employment and Workplace Relations (DEEWR) employment projections suggest a continuation of historical trends, with limited growth in the food and beverage industry overall. These projections do not cover long term developments that may result from export opportunities as Asian consumer demand increases. Further, the prospects for individual sectors and commodity groups will vary, as consumer preferences change and new technologies are introduced. Similarly, different occupations will have different prospects over the short, medium and longer term. For example, industry reports shortages of specialist engineers and food scientists. There are also emerging para-professions which need to be taken into account.Initial analysis by AWPA on the food and beverage workforce, comparing likely future demand for labour (over the next five years) with supply from the education and training system, does not indicate any widespread current or medium term shortages of skilled workers within the main occupations. However, a better understanding is needed of the extent to which recent declines in education and training completions, combined with the ageing of the workforce, may result in shortages in the future, particularly in emerging areas (which are not well covered in the existing statistical collections used for workforce planning). This initial analysis of existing data may also mask labour pressures within particular regions. Industry reports the competition for labour in mining regions as a particular challenge. There are also pressures in regional areas that rely on seasonal/harvest labour.It is also likely that skills gaps in the current workforce are inhibiting innovation and productivity growth. Addressing this will be critical to ensuring the goals of the National Food Plan are met.

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Looking further ahead, the scenario analysis developed for AWPA’s Future focus strategy includes medium to long term (to 2025) employment projections that show a general decline in the level of employment for agriculture production and food and beverage processing. Under each of these scenarios, employment in agriculture and fishing is expected to decline (apart from in the Long Boom scenario). For food and beverage manufacturing, employment is also expected to decline in three of the four scenarios (with growth projected under the Ring of Fire scenario). There are significant variations between the growth prospects for individual occupations and industry sub-sectors.

Growth opportunitiesThe value of Australia’s food exports has increased in recent years and there is significant room for further expansion. Japan remains the largest destination for Australian food exports, followed by the United States, Indonesia, Republic of Korea, China and New Zealand. In recent years, exports to China and Indonesia have shown the strongest growth. These markets differ considerably in their commodity imports, and this will continue to change over time as countries develop and tastes change.Currently, meat and grains and oilseeds are the two main agricultural commodities contributing to the value of Australia’s food production. Together they accounted for just under two-thirds of the total value of food production in 2011–12. This was followed by fruit and vegetables (18 per cent), milk (11 per cent) and seafood (5 per cent). In terms of food and beverage processing, the largest commodities are meat, dairy and beverages (including wine).Meat and grains are also important contributors to export income, accounting for 54 per cent of the value of Australia’s food exports in 2010–11. Dairy products accounted for a further 9 per cent, followed by wine (7 per cent) and seafood (4 per cent).Since 2000–01 the trend in Australia’s food exports has seen increasing shares in value terms for meat, wine and oilseed and grain products and declining shares for dairy, seafood, and fruit and vegetables. Looking forward, Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) projects the largest relative increases in export commodity volumes over the medium term (to 2017–18) to be in sugar, chicken meat, and lamb and mutton, with a decline in cotton, wheat, dairy, pig meat and coarse grains. In terms of export values, the largest relative growth areas in the medium term are projected to be in chicken meat, with a fall in the value of all other commodities with the largest declines in wheat, coarse grains and cotton. The relationship between export volumes and the value of exports is affected by a range of factors including world commodity prices, trade agreements, climatic conditions, pests and diseases and product quality, together with the skills and capabilities of the workforce. Looking at opportunities in the longer term, the food products projected to be most sought after in Asia by 2050 are beef, wheat, dairy products, sheep meat and sugar. These projections are based on the process of diet transformation currently underway in Asian countries. Studies have found that the main determinant of the changes in demand for food is income growth, which leads to major shifts in demand across different types of food to a more varied diet. The demand for processed foods has also been shown to increase as wages increase. There is also growing demand for Australian wines in Asia, particularly in China.

Factors impacting on demand for skills and labourThere have been a number of structural changes in the food and beverage industry over recent decades, including a shift away from family owned farms towards increased consolidation, corporatisation and use of contractors. The influence of the major supermarkets on the supply chain has increased, as has processing plant closures and downsizing, and foreign investment in Australian food firms. The effect of changing environmental conditions and access to water, and the introduction of new technologies has also been felt. These changes, combined with the demographics of the workforce (particularly the ageing of

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the agricultural workforce), all have implications for its future size and skill profile. For some sectors this will mean higher skill requirements, while for others new technologies are deskilling traditional job roles. As the food and beverage industry continues to restructure, some sectors will see employment growth, while others will see declines.Technology plays an important role in increasing productivity within the industry—across all parts of the supply chain, including transport and retail. Advances in areas such as techniques, tools, machines, remote farming, genetics, ICT applications, advanced manufacturing processes, irrigation and breeding are examples of new technologies and processes which have implications for skills and labour. Due to the greater accessibility and faster knowledge transfer available through the internet, new technology is being invented at a faster rate—increasingly by employees on the ground. New techniques, products or devices can be developed on individual farms and factories and more easily communicated to others. The introduction of new technologies and the shift to corporatisation of farming is changing the profile of the workforce. As the workforce continues to age, retention, replacement, succession planning and attraction have become critical issues. With these changes there is an opportunity to think of new ways of organising work, providing rewarding jobs and careers within the industry, and utilising workforce development, which incorporates more than just training.

What are the implications for skills and workforce development?This workforce study aims to ensure that the future of Australia’s food and beverage industry, as outlined in the government’s vision for the industry, is not constrained by a lack of skilled workers. This will require the industry to continue to adapt as the knowledge and skills required across the supply chain evolve. To realise the longer term opportunities arising from the Asian century firms will need to increase their investment in research, boost output, adapt to regulatory change and build capacity to ensure that Australian exporters have the skills, knowledge and capabilities to meet this demand.The ageing workforce presents challenges for future skill retention and succession planning, and implies a need to replace workers who will leave due to retirement. The challenge is to ensure that critical skills are retained and passed on, and that new skills are developed within the existing workforce to make the most of new technologies. Some sectors of industry tell us they are experiencing labour attraction and retention problems, while others have high turnover rates or stagnation. The supply of skills and labour to the sector comes from a range of sources, including from formal qualifications gained through vocational education and training (VET) and higher education. In addition to formal education and training courses, there is a significant amount of unaccredited training, including vendor training that occurs across the industry. Skill sets also play a role in upskilling and reskilling existing workers, where full qualifications are not required. Migration is also an important source of skilled and unskilled workers for the industry, particularly in regional areas.Publicly funded enrolments in food industry vocational training have not kept pace with the general growth in VET in recent years. It is not clear however how much formal training is being funded privately by firms and individuals. For food and beverage industry related higher education, enrolments show a gradual decline, although this masks trends across different qualifications and across different institutions. Completion rates are low within industry related VET and higher education. It is not clear why this is the case, but many industry stakeholders have commented that potential entrants are unaware of career opportunities in the industry (or have poor perceptions of the industry), or have not had sufficient exposure to the required maths and science skills or agriculture-related studies while at school. It is also acknowledged that the industry cannot always compete successfully with other sectors for new recruits. A range of strategies have been proposed by industry and other stakeholders to address these issues. AWPA’s food and beverage workforce

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study will draw these proposals together and make recommendations on the best way forward.Industry stakeholders have also raised concerns that higher education graduates are not work-ready and that there is a mismatch between the knowledge and skills developed through their education, and that required on the job. This is also an issue in the VET sector.Employers are seeking work-ready graduates. Students, also, are seeking training that is combined with practical experience. While this is not unique to the food sector, it does provide opportunities for greater use of work-integrated learning programs (such as apprenticeships, traineeships, internships and cadetships) and more direct involvement of businesses in discussions with the tertiary and higher education sectors to ensure that the skills developed through education and training better match those required by industry. Creating better pathways between VET and higher education is another priority identified by industry. There are some good examples of where these approaches are working that we will explore further.There is a perceived reluctance within the food and beverage industry to view training as an investment and many employers face barriers to releasing staff to undertake training. This dilemma is magnified for many owner-operators. Stakeholders comment that undertaking training is complex for many within the industry for a number of reasons, including the predominantly regional and remote location of the workforce and the limited ability of businesses with small employee numbers to invest in training and forego the time on the job. Traditionally on-the-job/informal learning has been preferred by the industry, which has contributed to the low level of formal qualifications among the workforce. Demonstrating the value of investing in skills and workforce development, including by adopting new approaches to attraction and retention, and assisting firms to undertake workforce development planning have been identified as priorities.Developing the business management, leadership and entrepreneurial capabilities of the workforce has been identified as critical to attracting and retaining workers to the sector and promoting high performing workplaces. Future success will depend on lifting the skills profile of the workforce and developing a commitment to lifelong learning and skills utilisation in workplaces. We must also ensure that our research organisations, both public and private, are used more extensively and that their innovations are applied across all parts of the food supply chain.There are many initiatives in place designed to promote and support skills and workforce development across the sector. They encompass career promotion, attraction and retention strategies, workforce planning, skills development and upskilling, and skills utilisation in the workplace. Some planned initiatives have never got off the ground or have ceased due to funding or other policy decisions. For some initiatives, such as scholarships, competition is fierce and funding is tight.AWPA’s initial research suggests that while there are currently many existing workforce development and skills initiatives being managed by a range of stakeholders, coverage is not consistent. Some sectors are more advanced than others in their workforce development thinking. Our research also suggests that a coordinated approach is not yet in place across the industry, which creates the potential for duplication and competing objectives. Despite the substantial support provided by government to address labour and skills issues, and the wide range of industry initiatives in place, stakeholders continue to raise concerns that the needs of the food and beverage industry are not being met. The AWPA food and beverage workforce study is looking at what is and isn’t working and its final report will demonstrate this through case studies. It will also make recommendations about future initiatives and structures to support the development of the food and beverage industry.

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IntroductionThe Australian Workforce and Productivity Agency (AWPA) is preparing a study of skills and labour issues in the food industry—encompassing agricultural production and food and beverage processing—to support higher food exports and meet growth opportunities in the Asian century. This Food and beverage workforce issues paper (the Issues Paper) is the first output of the study. AWPA provides the Australian Government with advice and recommendations on current, emerging and future skills and workforce development needs. As part of this remit, the agency develops a number of sector workforce development plans each year, in conjunction with industry stakeholders. In developing its sectoral plans, AWPA advocates a workforce development approach. Workforce development is concerned with the development of knowledge and skills in tertiary education; the matching of tertiary provision to the needs of industry, individuals and society; and the effective use and further development of knowledge and skills in the workplace. Sector workforce development plans provide an analysis of projected future demand and supply for qualifications, potential gaps and strategies to balance supply and demand. They also address issues such as attraction, retention and work organisation.The economic and strategic importance of Australia’s food industry, and its future potential, has been highlighted by a range of players in a number of recent and ongoing studies, inquiries and strategies. These include the Australian Government’s Asian century white paper released in 2012 and its forthcoming National Food Plan, which is due for release in the near future. Australia is acknowledged as having a safe and stable food system and high levels of food security. We are also recognised internationally for having a high level of scientific expertise and world-class researchers. These factors, combined with our proximity to Asia, put us in a strong position to maximise the opportunities emanating from developing Asian consumer markets.However, this sector faces a number of challenges in realising these opportunities, including the high dollar, competition from other food-exporting nations and access to export markets in the Asian region.The skills and adaptability of the workforce—from farmers to process workers to scientists —will be key enablers in realising the benefits of what is expected to be unprecedented growth in global demand for food by 2050.Building an innovative and productive food industry, capable of competing on a global scale, will require a significant shift in the sector’s skills profile: while the proportion of the workforce with post-school qualifications has improved between 2006 and 2011, it remains significantly below the all-industries average. It will not be sufficient on its own to increase the proportion of workers with a qualification. There must also be a shift upwards in the skills profile, and a commitment to lifelong learning and skills utilisation in the workplace. We must ensure that our research organisations, both public and private, are used more extensively and that their innovations are applied across all parts of the food supply chain.To address these challenges, the AWPA food and beverage workforce study aims to:

• draw on a body of research work, identifying growth opportunities, particularly for the export of high value food products to growing markets, including Asia

• briefly summarise the factors impacting on the industry and the demand for skilled workers. These include: the introduction of new technologies; ongoing industry restructuring; climate variability; resource constraints (such as water, energy and land); food safety; and consumer demands for sustainably manufactured food and fair trade; and animal welfare

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concerns• analyse the expected supply of skilled labour and any evidence of skills imbalances

(oversupply or undersupply) in key occupations• identify issues related to skills demand and supply for the sector, including difficulties in

attracting new recruits; the ageing of the workforce; and the need for greater industry engagement with the development of courses and validation of outcomes

• consider current initiatives designed to address workforce issues and identify methods to replicate best practice in workforce development across the industry.

The AWPA study will identify and address workforce development priorities, drawing on work which has already been undertaken or which is underway to examine various aspects of the food supply chain. Many organisations, including the National Farmers’ Federation, AgriFood Skills Australia (AgriFood Skills), the Allen Consulting Group and a number of Senate inquiries have made recommendations to address skills and workforce issues in the sector. AWPA’s workforce development plan will draw these together and make recommendations on the best way forward.This Issues Paper is accompanied and supported by the Food and beverage workforce: Statistical appendixes report which sets out the current state of the industry across broad commodity groups, together with projected growth in output, employment and exports. The statistical appendixes also includes an analysis of recent trends in food exports by their level of transformation.This paper is intended to stimulate discussion and debate, and to confirm (or challenge) issues identified here and in related studies. To this end, AWPA is inviting submissions on the Issues Paper by 7 June 2013. To provide feedback and make a submission refer to the How to provide feedback on this Issues Paper section of this report on page 94. AWPA’s final food and beverage workforce study report, which is due for release in late 2013, will incorporate feedback from stakeholder submissions and consultations, including further examples of successful workforce development initiatives showcased through a set of case studies.

Scope of AWPA’s food and beverage workforce studyIn its broadest sense, the Australian food industry encompasses a number of sectors—from the raw materials used in food production (the farming and fishing sectors) through to the processing sectors and ultimately to exports and domestic sales. The key components of the food supply chain are shown in Figure 1 below.

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Figure 1: Overview of Australia’s food supply chain and its dependencies

Source: DAFF 2012, Australian Food Statistics 2010–11, p. 44.

The Department of Agriculture, Fisheries and Forestry’s (DAFF) publication FOODMap: An analysis of the Australian food supply chain proves details on each major food category’s distribution channels, from production to processing, imports to exports, to the retail and food services sectors. As this report notes, each food category and channel has its own peculiarities driven by the nature of the product and its sources, the nature of the competitive environment within the supply chain and marketplace, and the ownership and integration arrangements that operate.1

This report shows that the majority of food exports are high volume and low value add in terms of their food processing components. It does not, however, include in its focus the level and nature of skills and workforce development in food supply chain components. This is a key gap that this Issues Paper seeks to address. There is a high degree of interdependency along the food supply chain (including infrastructure, labour and imports). This study focuses on the food production and food processing parts of the supply chain, but recognises that the innovations required to achieve export growth potential will impact on skills and workforce issues (such as job design) along the supply chain.The forthcoming National Food Plan, which will be the first developed in Australia, identifies the government’s priorities and outlines the actions it will take to achieve its vision for Australia’s food system to 2030. The vision is for a food system that is sustainable, globally competitive and resilient.Skills and workforce development will play an integral part in achieving this vision, together with other policy areas spanning infrastructure, health, trade and foreign aid, industry and innovation, competition, climate change and energy, social inclusion and regional policy.

1 Department of Agriculture, Fisheries and Forestry (DAFF) 2012, FOODMap: An analysis of the Australian food supply chain, Canberra, July, available at http://www.daff.gov.au/foodmap

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This workforce study is focussing on skills policy to support the National Food Plan, to ensure that the growth and development of the sector is not constrained by a lack of skilled workers and innovative firms. It aims to help Australia develop the skilled, adaptable and high performing workforce it will need to drive a sustainable, competitive and resilient food sector to drive the achievement of the Australian Government’s vision.

Overview of this Issues PaperPart 1 of this paper provides an economic overview of Australia’s food and beverage industry.Part 2 looks at the opportunities and challenges facing the sector against five themes which have been identified by AWPA as providing a framework for its sectoral industry studies: demographics, Asian century, restructuring, technology and human capital. Part 3 presents analysis of labour and skills demand and supply for the industry.Part 4 draws together a supply and demand analysis, with a focus on key occupations and skills. It includes an assessment of which occupations are likely to be in short supply in the medium term.Part 5 presents examples of innovative approaches to workforce development across the sector. It also highlights some challenges and issues that have been identified.Part 6 raises questions for further discussion and provides guidelines on how stakeholders can provide comment on the issues raised.

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Part 1: Economic overview of the sectorThe food and beverage industry makes an important contribution to the Australian economy. In 2011–12 farm and fisheries production and processing accounted for approximately 4 per cent of Australia’s GDP and 11.5 per cent of the total value of merchandise trade exports.As shown in Figure 2 in 2011–12:

• the total value of Australian farm and fisheries food production was $42.6 billion• food and beverage processing was valued at $91.2 billion• exports across both production and processing were valued at $30.5 billion.

Figure 2: Value chain for food in Australia 2011–2012

Source: DAFF, 2013, Australian Food Statistics 2011–12, p. 2.

Meat and grains and oilseeds are the two main commodities currently contributing to the value of Australia’s food production. Together they account for just under two-thirds of the total value of production and 54 per cent of the value of exports.

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Wheat is the largest export commodity by volume, followed by coarse grains, sugar and oil seeds. For meat commodities, beef is significantly the largest export, followed by sheep meat.In the past five years the largest increases in agricultural exports per annum were:

• oil seeds (52.8 per cent)• cotton (39 per cent)• wheat (32.8 per cent) • coarse grains (15.7 per cent).

For meat commodities, in the past five years: • poultry meat exports increased (5.8 per cent per annum)• beef exports remained stable • sheep meat exports declined (–4.9 per cent per annum) • pig meat exports also declined (–6.9 per cent per annum).

For dairy exports, in the past five years, whole milk powder and skim milk powder increased by 5.8 per cent and 4.2 per cent per annum respectively, while cheese and butter exports declined (by –5.6 and –4.1 per cent per annum respectively).Fisheries exports declined by –2.7 per cent per annum between 2007–08 and 2011–12.While export values have grown over recent years, Australia still has a very low level of exports considered to be elaborately transformed. Australian food products are categorised into two main groups based on the level of transformation; minimally transformed, and substantially and elaborately transformed. This list separates food products based on these categories:2

Minimally transformed goods

• Live animals—for example, cattle, sheep exported for consumption in countries of destination

• Fish and shellfish—for example, live, fresh, chilled and frozen• Fresh and chilled horticulture—for example, vegetables, fruits and nuts• Grains—for example, wheat, barley, corn, oats, sorghum• Oilseeds—for example, canola, soybeans, sunflower • Other unprocessed food not classified elsewhere.

Substantially and elaborately transformed goods

• Processed meat—e.g beef, veal, sheep, lamb, goat, pig meat, poultry (including chicken, duck, turkey, geese), bacon, ham and other smallgoods

• Processed seafood—for example, pieces, fillets, dried, canned, preserved fish and shellfish• Dairy products—for example, milk and cream processing, ice cream, butter, cheese, milk

powders• Processed fruit and vegetables—for example, canned, bottled, dried, juiced, preserved,

frozen• Oil and fat—e.g canola oil, sunflower oil, cottonseed oil, lard• Flour mill and cereal food—for example, flour mill products, cereal food, baking mix

2 Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES), 2005, Australian commodities: June quarter 2005 http://adl.brs.gov.au/data/warehouse/pe_abare99001737/ac05_june.pdf, p. 380.

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• Bakery products—for example, bread, cakes, pastries, biscuits• Other foods—for example, sugar, confectionery, other processed foods not classified

elsewhere• Beverages and malt—for example, soft drink, cordial, syrup, beer and malt, wine, spirits.

The distinction between substantially transformed goods (STGs) and elaborately transformed goods (ETGs) is not precise. However, ETGs generally involve more intensive intellectual property, capital and innovation. STGs are goods such as alcoholic beverages, meat and sugar. ETGs are those such as biscuits and confectionery which have undergone a more advanced level of transformation in comparison to STGs, and which progress through a greater number of processes and/or more complex processes to reach their final product. ABARES projections for export commodity volumes show the largest relative increases over the medium term (to 2017–18) to be in sugar, chicken meat, and lamb and mutton, with a decline in cotton, wheat, dairy, pig meat and coarse grains. ABARES projections for export commodity values show the largest relative increase in the medium term to be in chicken meat, with a fall in the value of all other commodities with the largest declines expected in wheat, coarse grains and cotton.3 According to IBISWorld analysis, wine exports account for 2.3 per cent of Australia’s total exports and wine is the twelfth largest exporting industry.4 There has been a glut of wine production in recent years, resulting in decreased prices, with some production income falling below production cost. With the wine glut Australia produces some 20 to 40 million cases a year more than is being sold. The national harvest has not decreased in tonnage in recent years, some 1.6 million tonnes in 2010–11, and at the same time the total area of grape vine plantings increased by 1.8 per cent to 154,000 hectares. The total supply of wine is nearly double demand, including exports.Exports have slowed in the past five years by some 5 per cent per annum, under the influence of increasing global competition, the high Australian dollar, and the global economic downturn. World demand for wine is forecast to be flat. Exports to China have been the only market to grow in the past two years and have now reached over 50 million litres per annum.The wine industry, as a whole, is undergoing a downturn with a drop in exports, loss of bargaining power to supermarkets and an oversupply of wine grapes placing pressure on producers. Australia is no longer a low-cost producer in comparison to competitor countries and now needs to compete on quality at higher price points. Over the next five years increases in wine exports depend on opening up emerging markets in Ireland, Canada, Germany, China, India, South Korea and Japan.5

Structure of the food production and processing sectorThe agricultural sector is mostly comprised of family/owner operated and small businesses. In 2010–11 of the 180,167 agriculture businesses, 98 per cent were small businesses. 6 Of these, 71 per cent were non-employing businesses. At the other extreme, less than 1 per cent of businesses employed 200 or more employees.In 2011 there were over 13,000 businesses in the food and beverage processing industry in Australia, 99 per cent of which were small and medium enterprises (SMEs). However, almost three-quarters of the domestic industry’s revenue was accounted for by Australia’s 50 largest food and beverage companies, most of them large multi-national corporations. See the accompanying Food and beverage workforce: Statistical appendixes for a listing of major

3 ABARES, The accompanying statistical paper includes more detail of the ABARES historical and projected commodity analysis.

4 Ryan L, 2012, ‘Wine Production in Australia’, IBISWorld Industry Report C1214, September, p. 21.

5 Kidson, A, 2012, ‘Grape Growing in Australia’, IBIS World Industry Report A0131, December; Lin, R, 2012, ‘Wine Production in Australia’, IBISWorld Industry Report C1214, September.

6 A small businesses is defined as either non employing or employing less than 20 workers. 19

companies in both production and food processing.The bakery product manufacturing (non-factory based)7 group had the largest share of businesses (employing and non-employing) relative to other sectors in this industry. Most of the output of these SMEs is for niche markets serving their respective localities. This is in contrast to industry sectors such as meat processing, dairy product manufacturing and sugar and confectionery manufacturing which have a relatively high proportion (5.4, 3.8 and 5.2 per cent respectively) of large firms (200 or more employees) that are characterised by economies of scale.8

There is a large workforce that supports the production and processing sectors (in the order of 553,000). However, it is acknowledged that there are issues with the published data that make it difficult to analyse the size and makeup of the workforce.As discussed further in Part 2, employment is spread across occupational categories from highly skilled to semi and low skilled, including Managers, Professionals, Technicians and Trade Workers, and Labourers.The workforce has a number of features which in some ways make it unique from other industries, and which require the use of different strategies and approaches to workforce issues.These defining features include:

• a relatively high level of seasonal, casual and contract labour (including harvest labour) within the agriculture and horticulture sectors

• a wide geographic spread, with much of the work occurring in regional and rural areas• an ageing workforce within agriculture• workers from a wide range of cultural backgrounds• low levels of literacy and numeracy across a number of occupational groups and industry

subsectors, across both production and processing• a wide dispersion in skill levels—from highly skilled occupations to semi and low skilled jobs• a range of ownership structures, including owner operators, family business models,

sovereign wealth funds and multinationals• employment is concentrated in SMEs (particularly in food processing).

The introduction of new technologies across the food supply chain and the shift to corporatisation of farming is changing the profile of the sector. As the workforce continues to age, retention, replacement, succession planning and attraction become critical issues. With these changes there is an opportunity to think of new ways of organising work, providing rewarding jobs and careers across the industry, and utilising a workforce development approach which incorporates more than just training.As the food and beverage industry continues to restructure, some sectors will see employment growth, while others will see declines. For some sectors there will be a shift to higher skill requirements, while in others new technologies will further deskill traditional job roles. A key challenge will be to retain critical skills within the supply chain; develop new skills to keep pace with technology and to promote a culture of lifelong learning.

7 Non-factory based bakeries were introduced into the ANZSIC Manufacturing Division in 2007–08 and this has had an impact on trend data for the food processing industry.

8 Food Processing Industry Strategy Group, 2012, Food Processing Industry Strategy Group: Final Report of the Non-Government Members, p 25.

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Part 2: Environmental scanThis section looks at the opportunities and challenges facing the food and beverage industry against the five key themes which AWPA uses as a framework for its sectoral studies.

DemographicsThe demographics of the food workforce differ from the average across other industries in a number of respects. This reflects the nature of the work within the industry and the dispersion of employment across metropolitan, regional, rural and remote locations. Figure 3 shows the age profile of the three industry sub-divisions of relevance to this study9 compared with the all-industries age profile. It shows that the average age of workers within the Agriculture, Forestry and Fishing sub-division is considerably older than the average across all industries, with larger proportions in the 55 years and over categories, particularly the 65 years and over cohort. The Australian Farm Institute (AFI) highlights two factors to consider when looking at the workforce age. A significant proportion of farmers are above retirement age and may no longer be actively involved in farm operations, however they are still classified as farmers due to their ownership of at least some of the farm assets. The presence of this group in the statistics is likely to bias the average age upwards. Further, over the period from 1990 to 2011, the average capital value of Australian farms has more than doubled in real (inflation adjusted) terms, from around $1.78 million to $3.92 million. This is an effect of farms getting bigger; consequently younger farmers are less likely to be able to afford to enter farming at an early age given the amount of capital now required. Many stakeholders also cite the out-migration of young people from regional communities in search of study and work options as another factor contributing to the older age profile.An older workforce presents challenges for future skill retention and succession planning, and implies the need to replace workers who will leave due to retirement. However, the increased mechanisation of farming processes and the trend towards farm ownership consolidation, mean that the imperative to hire new workers is lessened. The challenge is to ensure that skills are retained and passed on, and that new skills are developed within the existing workforce to make the most of new technologies. It should be noted, however, that many of the new technologies being introduced are intuitive, and while requiring a basic level of digital literacy, they do not require a higher level of skills.While the agricultural workforce has an older age profile, the food processing sector has a relatively young workforce (although it varies across sub-sectors, as shown in the Food and beverage workforce: Statistical appendixes at Appendix C).

Some industry sectors tell us that the most pressing issue is attraction and retention of workers. While some sectors have high turnover of labour, in others ‘stagnation’ appears to be a problem. This suggests the need to differentiate between ‘good’ and ‘bad’ turnover.

9 This data reflects Agriculture, Forestry and Fishing, Food Product Manufacturing, and Beverage and Tobacco Product Manufacturing. However, the Forestry and Tobacco Manufacturing sub-sectors are not part of the scope of this study.

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Figure 3: Age distribution of workers (percentage terms) in food related sectors and all-industries 2012

Source: ABS Labour Force Cat. No. 6291.0.55.003, Detailed, Quarterly.

Levels of part-time employment and female employment vary significantly between the production and processing sectors. See the Food and beverage workforce: Statistical appendixes at Appendix C for detailed tables. At the industry sub-division level, part-time employment increased in Agriculture (1.7 percentage points) and Aquaculture (2.1 percentage points) at a higher rate than the all-industries average (1.4 percentage points) between 2007 and 2012.10 The proportion employed part-time in 2012 ranged from 14.4 per cent in Agriculture and Fishing Support Services to 44.3 per cent in Nursery and Floriculture Production. This compares with the all-industries average (across the economy) of 29.6 per cent.Between 2007 and 2012 women’s share of employment in the Agriculture sector remained steady, while it fell in Aquaculture (–5.2 percentage points) and increased in Agriculture and Fishing Support Services (6.0 percentage points). These figures compare with a slight increase on average across all industries (0.6 percentage points) over the five years.In 2012, women accounted for 45.7 per cent of employment averaged across all industries. Within the agriculture and fishing sector, the proportion ranged from 16.2 per cent in Fishing to 46.7 per cent in Nursery and Floriculture Production.The proportion of part-time workers in the Food Manufacturing industry in 2012 was 25.6 per cent. There is significant diversity in the availability or use of part-time work within the food and beverage processing sector, ranging from 12.4 per cent in (the traditionally male) Meat and Meat Product Manufacturing to 51.8 per cent in Seafood Production.Between 2007 and 2012 part-time employment increased in all food manufacturing subsectors, with the exception of Dairy Product Manufacturing. Significant increases were recorded in the Seafood Processing (12.9 percentage points) and the Oil and Fat Manufacturing sub-sectors

10This data on part-time employment refers to hours worked. It provides no indication of the level of casual and seasonal employment within the industry.

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(11.4 percentage points). Within the Food and Beverage Manufacturing sector, women’s share of employment ranged from 9.7 per cent in Oil and Fat Manufacturing to 50.9 per cent in Bakery Production Manufacturing in 2012. The only sectors to show an increase in their proportion of female workers were: Meat and Meat Product Manufacturing, Fruit and Vegetable Processing and Beverage Manufacturing.The demographic make-up of the industry has implications for attraction and retention of workers, the development of succession strategies, as well as strategies aimed at increasing workforce participation more broadly. Key points

• The agriculture sector has a high proportion of older workers who are classified as owner operators. This, combined with an increase in the average size and value of farms, has implications for data analysis, succession planning and attraction of new entrants.

• In contrast, the processing sector has a relatively young workforce.• Some sectors have high labour turnover, while other sectors are experiencing stagnation.• The current demographic profile has implications for attraction and retention strategies, in

particular those aimed at groups who are currently underrepresented in parts of the industry, for example women, younger workers and mature age workers.

Questions for discussionHow is the age profile impacting on your sector, including its impact on labour turnover?How can the food and beverage industry ensure that existing skills and knowledge are retained into the future?What can the industry do to ensure that skills and knowledge are fit for purpose in the future?

Opportunities arising from the Asian centuryThe rise of the middle class in Asia this century brings with it potential opportunities for Australian food exports, including the export of knowledge and expertise. To thrive in the Asian century Australia must have a clear plan to seize the economic opportunities that will flow and manage the strategic challenges that will arise. In 2012 the Australian Government released its Asian century white paper which set out the following objectives for the food industry:

• Australia’s agriculture and food production system will be globally competitive, with productive and sustainable agriculture and food businesses.

• Australia’s food producers and processors will be recognised globally as innovative and reliable producers of more and higher quality food and agricultural products, services and technology to Asia.

The Asian century white paper emphasises the need to build stronger entrepreneurial, management and technical skills to connect to global food industry value chains. This includes ‘supply chain management skills, including consistency of supply and the tailoring of products and services to specific market needs’.11 11Australian Government, 2012, Australia in the Asian Century White Paper, p. 216.

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If Australia is to realise the longer term opportunities arising from the Asian century, it is important to know where future demand will occur and ensure that our producers and processors have the skills, knowledge and capabilities to meet this demand. Trade markets in Asia are not homogeneous, however there is a clear shift to more highly value-added food products. Currently there appears to be a lack of transparency for industry regarding import requirements for the various markets and a lack of clarity regarding the level of domestic subsidy.12

ABARES is currently working on an assessment of trends in global food demand, seeking to identify opportunities for Australian producers in expanding Asian markets over the medium to long-term. This research will be presented in a series of reports entitled What Asia wants: better understanding future Asian food demand. This analysis needs to consider how future demand compares with the current profile of exports, to establish the gap that needs to be bridged by Australian food producers and processors.Asia is already a major trading partner for Australia. According to Australian Food Statistics 2010–11, Japan was the largest destination for Australian food exports. Indonesia is a key growth market for Australia, rising from 3.7 per cent of total food exports in 2000–01 to 8.5 per cent in 2010–11. Australian exports to China have also grown significantly over the past decade.13

The food commodities projected to be most sought after in Asia by 2050 are beef, wheat, dairy products, sheep meat and sugar.14 These predictions are based on the process of diet transformation currently underway in Asia. Studies have found that the main determinant of the changes in the demand for food is income growth, which leads to major shifts in demand across different types of food to a more varied diet.15 The demand for processed foods has also been shown to increase as wages increase; people are more willing to pay for convenience which frees up their time for income earning activities.16 Figure 4 shows the potential growth areas resulting from increasing food imports into Asia to 2050, suggesting opportunities exist for Australian exporters in meat, fruit and vegetables, dairy products and cereals in particular.

12Food Processing Industry Strategy Group, 2012, Food Processing Industry Strategy Group: Final Report of the Non-Government Members, p 41.

13DAFF, 2012, Australian Food Statistics 2010–11, p. 16.

14Linehan V, Thorpe S, Andrews N, Beaini F, 2012, Food demand to 2050: opportunities for Australian agriculture ABARES, Outlook conference paper no. 12.4, Canberra, March www.adl.brs.gov.au.

15Pingali P, 2006, ‘Westernization of Asian diets and the transformation of food systems: Implications for research and policy’, Food policy, 32 pp. 281–298, 282.

16Regmi, A and Dyck J, 2001, ‘Effects of urbanisation on global food demand’ in Regmi A (ed), Changing Structures of Global Food Consumption and Trade ERS WRS 01-1. Economic Research Service, United States Department of Agriculture cited in Pingali P, 2006, ‘Westernization of Asian diets and the transformation of food systems: Implications for research and policy’, Food Policy, 32, 281–298, p 282.

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Figure 4: Asian food imports to 2050: Real value by commodity group

Source: Jammie Penm, 2013, ‘Long term food supply, demand and price implications’, ABARES Outlook Conference

These projections are supported by data on the annual consumption of food groups in Asian diets between 1979 and 2001, which show a large increase in the consumption of milk, meat, beef, fish and vegetables among others.17 Growth in demand for these commodities is projected to increase the value of Australia’s agrifood exports by 140 per cent between 2007 and 2050, which is driven by substantial increases in the real value of beef, wheat, dairy products, sheep meat and sugar.18 It will be important to understand what is likely to drive this increase in export value. The relationship between export volumes and the value of exports is affected by a range of factors including world commodity prices, trade agreements, climatic conditions, pests and diseases and product quality, together with the skills and capabilities of the workforce. To realise these longer term opportunities will require greater investment by agribusinesses in research to boost output, adapt to regulatory change and build capacity to ensure that Australian exporters have the skills, knowledge and capabilities to meet this demand. The challenge for this industry is to increase and potentially modify production to meet new demands, while also retaining the existing industry base.19

17Pingali P, 2006, Westernization of Asian diets and the transformation of food systems: Implications for research and policy, Food Policy, 32, pp. 281–298.

18Linehan V, Thorpe S, Andrews N, Kim Y & Beaini F, 2012, Food demand to 2050: opportunities for Australian agriculture, ABARES, Outlook conference paper no. 12.4, Canberra, March, p. 1 available at http://www.daff.gov.au/abares.

19Australian Government, 2012, Australia in the Asian Century: White Paper, Canberra, pp. 214–215.

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Stakeholders from the food and beverage industry have previously suggested there is a lack of expertise in promoting export opportunities in the food processing sector. The Australian Government is assisting businesses in building their export capacity, through programs such as Enterprise Connect and the recently announced Food Innovation Precinct.20

Increasing Australian exports to Asia will require the development of, what has been termed, Asia-relevant capabilities, such as cultural knowledge of Asian countries and particular technical skills to help businesses take up growth opportunities.21

Key points

• Australia is well placed to capitalise on the opportunities afforded by the Asian century, including potential growth in food exports to India, China and Indonesia.

• There are, however, a number of challenges which must be overcome.• To ensure Australia is best placed to meet these challenges will require productivity

improvements, new capabilities among agribusinesses and ongoing investment in Research and Development and Extension (RD&E).

Questions for discussionGiven Asia’s growing demand for high value foods, how can Australian food producers and processors be assisted to gain the knowledge and skills required to maximise export opportunities?What do you think are the key opportunities for commodity and food product exports to Asia over the longer term?

Restructuring of the industryThe restructuring theme is concerned with the effect of structural changes on the industry, including changes to markets, new technologies and work practices, location, supply chains, and workforce. Many of these issues cross over with the other themes discussed in this section, including the following discussion on technology. Changes in the structure of an industry can lead to a need for new and/or different skills. Such changes can be gradual or sudden and are triggered by a variety of factors. Some may emanate from other parts of the supply chain—for example, transport and logistics, or retailing—but have implications for the production and processing workforce and the skills required.Within the food industry there have been a number of recent changes that have affected the skills profile of the industry. These include: a structural shift towards larger farms; the need to meet increased volume demand; the effect of changing environmental conditions and requirements; and new technologies. All of these have implications for the size of the workforce and its skills profile and indicate a need for higher level skills and productivity improvements. Within the food processing sector recent plant closures, downsizing and off-shoring are also impacting on skills, with loss of expertise and knowledge from the sector. These changes create a need to retrain and reskill displaced workers. There is however growth opportunities as new processes and technologies are adopted. Changing ownership structures are also likely to have an impact on the workforce.20Industry Innovation Precincts see http://www.aussiejobs.innovation.gov.au/programs/industry-innovation-precincts/Pages/

default.aspx.

21Asialink, 2010, Mapping our future in the Asian century, Asialink Asia Society National Forum.26

Structural shifts in farming have intensified the trend away from family owned farms towards increased consolidation, corporatisation and use of farm employees and contractors. Agricultural production has also become more concentrated on large farms. It has been estimated that 10 per cent of Australian farm businesses now produce over 50 per cent of output. In contrast, the smallest 50 per cent of farms account for just 10 per cent of gross farm output.22 The effects of climate change and variations in access to water are increasing the variability that producers must manage. Producers manage year to year variability and have adapted to their local climate by establishing infrastructure and developing local farming practices. Changes in the climate may require adjustments to current practices and chosen commodities in order to maintain productivity.23 Therefore it is important to identify the adaptive capacity of local farmers, communities, and industry groups by region, so as to identify and rectify factors that may hinder successful adaptation.24

To add to this challenge, there has been a recent increase in the proportion of agricultural commodities used as biofuels. According to the OECD, biofuels are an emerging sector that will increasingly affect agricultural markets. Currently some 65 per cent of European Union vegetable oil, 50 per cent of Brazilian sugarcane, and about 40 per cent of corn production from the United States of America is used as feedstock for biofuel production.25 The international market for biofuels is relevant to Australia as the quantity of commodities used in the production of biofuel and associated countries’ polices on the use of biofuel, can affect the price Australians receive for their product. Producers need the right skills and knowledge to understand the effect of the variability and get the best from environmental and international conditions. Australians are now more conscious about the quality of their food and the methods used to produce it. Arguably they are becoming more aware of production methods, in particular, the impact on animal welfare and the environment. This has led to a change in the minimum standards for how food is produced, causing some farmers and processors to re-examine the way they operate. This has required skills being developed or hired in areas such as production line mechanics and different farming techniques. Alongside this there has been a growing demand for higher quality food, among products such as infant milk powder formulas. Skills in food safety and quality assurance are required to meet this demand. Key points

• There has been a number of structural changes in the food and beverage industry over recent decades, including a shift away from family owned farms towards increased consolidation, corporatisation and use of contractors; processing plant closures; changing environmental conditions; and the introduction of new production processes.

• Structural changes in the industry are creating a need for new and different skills, including leadership, management, mentoring, risk management and the ability to translate research and development into business processes along the supply chain.

22Productivity Commission, 2005, Trends in Australian Agriculture, Canberra p xxiv

23Gornall et. al., 2010, Implications of climate change for agricultural productivity in the early twenty-first century, in Phil. Trans. Royal. Soc. B, 365, 2973–2989, p 2974.

24CSIRO editors: Cleugh H, Stafford Smith M , Battaglia M, and Graham P, 2011, Climate Change: Science and Solutions for Australia, CSIRO Publishing, Victoria, p 94.

25OECD/FAO, 2012, OECD-FAO Agricultural Outlook 2012–21, OECD Publishing and FAO.http://dx.doi.org/10.1787/agr_outlook-2012-en, p 88.

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Question for discussionHow are the identified restructuring trends, such as climate change, consumer awareness and company ownership, changing the skills needed by the industry?

TechnologyTechnology plays an important role in increasing productivity within the industry—across all parts of the supply chain. Advances in areas such as techniques, tools, machines, remote farming, genetics, ICT applications, advanced manufacturing processes, irrigation and breeding have already helped to increase Australia’s productivity and competitiveness.Examples of recent and emerging advances within the agricultural production sector include low-cost soil moisture probes scattered throughout paddocks, advanced 3D imagery to measure crops, and livestock tracking with position tags. Additionally, the National Farmers’ Federation (NFF) has identified technology developments such as robotic technology, human genomics and laboratory production of meat as developing issues that could have major impacts on Australian agriculture in the future.26 Equally important are the technological advancements being made within the food processing sector. Technologies currently in development in this area include: high pressure processing (HPP), ultrasonics, pulsed electric field and cool plasma.27 Whilst some technologies are not yet in commercial use, both HPP and ultrasonics are already being utilised in Australia to produce a variety of goods including various fruit juice and dairy products. Historically, Australia has had a high level of productivity within its agriculture industry compared to many other countries, making further large improvements more difficult without a concentrated effort on long term ground-breaking research. Ongoing investment in RD&E is likely to be necessary to maintain and improve productivity under changing climate and resource constraints. 28

As discussed further in the following section, human capital, accumulated through education, training and extension, directly lifts productivity growth by increasing innovation adoption and improving the ability of farmers to select and apply appropriate innovations for improving production efficiency.29 Due to greater accessibility and faster knowledge transfer available through the internet, new technology is being invented at a faster rate, increasingly by employees on the ground. New techniques, products or devices can be developed on individual farms and factories and more easily communicated to others. The potential benefits may be lost if the new technology is not adopted when it becomes available. In some cases, the products will be highly sophisticated with the technologies ‘built in’ to user-friendly interfaces, making them intuitive to use. In other cases, they will require considerable upskilling of workers and changes to training products. There are a number of factors that could potentially contribute to a greater rate of adoption of new technology. One critical factor relates to the skill level of the adoptee. If a business does not understand or have the required skill to utilise the new technology it may not risk adopting

26National Farmers Federation, 2013, Blueprint for Australian Agriculture 2013–20, Canberra.

27See http://www.csiro.au/Organisation-Structure/Divisions/Animal-Food-and-Health-Sciences/Food-Pilot-Plant.aspx

28Sheng Y, et. al., 2011, A turning point in agricultural productivity: consideration of the causes, ABARES research report 11.4, p iii.

29Nossal K and Lim K, 2011, Innovation and Productivity in the Australian Grains Industry, ABARES research report 11.06.

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it. Or if it does adopt, it may not gain the full benefit of its application. Therefore it is important to ascertain not only what skills people need to invent new technologies but also whether they have the skills to capitalise on new technology. The forthcoming 2013 AgriFood Skills’ E-Scan also acknowledges the importance of technology. It includes the ‘diffusion of new research findings, innovative practice and technologies’ as one of its five priorities for the industry.Key points

• Technology plays an important role in raising productivity in this industry, and this will be increasingly true in the future on the farm and in the factory.

• Companies will only realise their full potential if they have the skills and capabilities to adopt new technologies.

Questions for discussionWhat type of collaboration between government, industry and the education and training sectors currently is assisting your workforce to adopt and contribute to new technology and innovation?How are recent and emerging advances in technology impacting on skills?

Human capital and the imperative to upskillHuman capital refers to the knowledge, skills, competencies and attributes embodied in individuals that facilitate the creation of personal, social and economic well-being.30 Human capital drives both the creation and the application of knowledge. As AWPA identified in its Future focus, 2013 Workforce Development Strategy, an increase in human capital, achieved, for example, by a person becoming better qualified, can be used to improve productivity in a high value economy. However, the benefits of an individual gaining these higher qualifications will not be realised unless there are accompanying improvements in work organisation and job design to make better use of employee skills and capabilities.This study of the food and beverage workforce is concerned with the skills and competencies held by the workforce (and the potential workforce) and looks at whether these skills and competencies are sufficient to meet the challenges and opportunities of the future. These future challenges might include increasing production to meet increased demand; adapting new technologies; or capitalising on new markets, environments and technology. Industry commentators have indicated that there is a general reluctance within the food and beverage industry to view training as an investment in the same way that purchase of capital equipment is viewed. It is also acknowledged that agricultural employers need to develop the capabilities to integrate workforce planning and development into their business planning.31 AgriFood Skills’s objective for the industry going forward is to have ‘a globally competitive, profitable and sustainable agrifood industry through world class capabilities and leadership’. The forthcoming 2013 AgriFood Skills’ E-Scan sets out a number of priorities that support this objective and which relate to the human capital of the agrifood workforce. These include: • development of business management, leadership and entrepreneurial capabilities

30OECD http://www.oecd.org/

31National Rural Advisory Council, http://www.daff.gov.au/agriculture-food/drought/nrac/work-program, accessed 10 April 2013.

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• adoption of higher level skills and knowledge• retention and utilisation of existing workers.An employer’s decisions about investment in training depends largely on its particular interests, values and commitments. Training relevance and flexible delivery have more influence on decision making than who provides the training or whether it is accredited. This means that aligning tertiary education with employer interests can be as important as meeting the needs of individual learners. Partnerships between enterprises and providers may be the most useful method of encouraging employer investment in training. Improving employers’ perceptions of the value of training is central to increasing the level of investment.32 Employers need to be convinced that there will be a return on investment, particularly in the current environment of low margins and high costs.A vital consideration in the human capital theme for the food industry is the intensity of effort, innovation and application of RD&E. Agricultural productivity growth is closely linked to innovation and RD&E.33 In a recent study, ABARES concluded that public RD&E directly accounted for two-thirds of the average annual broadacre productivity growth recorded between 1952–53 and 2006–07.34 Higher levels of skill have been found to be strongly associated with higher levels of productivity. Given the finite nature of the resources required for production, productivity will have to increase to facilitate future growth. The stock and flow of human capital and skills, and how those skills are used, will be critical in driving productivity gains. As discussed in Part 3, while the percentage of food workers with a post-school qualification increased between 2006 and 2011, it remains significantly below the all-industries average. Formal qualifications are available from a range of VET and higher education institutions. Stakeholders from the food and beverage industry have previously raised concerns that higher education graduates are not work-ready and that there is a mismatch between the knowledge and skills developed through their education and that required on the job. This has been identified as a key issue for the food and beverage workforce in a 2012 Senate inquiry into higher education and skills training to support agriculture and agribusiness in Australia.35 The inquiry recommended that the Australian Government commission a study to determine the most appropriate higher education framework to support high-level, practically-focused agribusiness education. A 2012 Senate inquiry into Australia’s food processing sector36 recommended that ‘tertiary and higher education providers should engage more directly with food processing businesses about curricula and outcomes to ensure that the skills developed through further education better match those required by industry’. This engagement currently occurs on an ad-hoc basis, and is hampered by the lack of a single industry body.One way of bridging the gap between tertiary education and work is via work-integrated learning, in which work practice informs theory either within formal curriculum or via co-curricular means. However, work-integrated opportunities for students are limited, and employers, particularly small businesses, find that it is costly and time-consuming to make opportunities available. This may also be the case for internships, a form of on-the-job training, 32AWPA, 2013, Future focus, 2013 National Workforce Development Strategy, Canberra.

33National Farmers’ Federation, 2013, Blueprint for Australian Agriculture 2013–20, Canberra, p. 17.

34Sheng et. al., 2011, Public Investment in agricultural R&D and extension: an analysis of the static and dynamic effects on Australian broadacre productivity, ABARES Research Report 11.7

35Commonwealth Government, 2012, Australian Senate, Education, Employment and Workplace Relations References Committee Inquiry into higher education and skills training needs to support future demand in agriculture and agribusiness in Australia; Victorian Government, 2012, Parliament of Victoria Education and Training Committee Inquiry into agriculture education and training.

36Select Committee on Australia’s Food Processing Sector, 2012, Senate Inquiry into Australia’s food processing sector, August, the Senate, Canberra.

30

usually unpaid, also known as work experience or industry placements. Another way of bridging the gap is via professional cadetships, where an employer agrees to contribute to, or subsidise the cost of, an employee’s education. There is benefit in collaboration between government, providers and industry to expand opportunities for work-integrated learning and to support further development of professional cadetships in identified higher education occupations and higher level VET qualifications. AWPA has recommended that the Australian Government work with VET and higher education stakeholders and peak industry bodies to support transitions from higher level VET and higher education to employment by expanding work-integrated learning and by establishing a co-funded professional cadetships program for identified specialised higher education occupations and higher level VET qualifications. This may present an opportunity for the food industry, where new graduates can become the champions of reform.Stakeholders also comment that undertaking training is complex for many within the industry for a number of reasons, including the predominantly regional and remote location of the workforce and the limited ability of businesses with small employee numbers to invest in training.

31

Traditionally on-the-job/informal learning has been preferred by the industry. It is possible that by utilising a skill set approach to training, and better targeted deliveries augmented by internet-based and block practical components, some of the barriers to work-integrated learning can be reduced. A recent report by the National Centre for Vocational Education Research (NCVER) found that the acquisition of skill sets in the agriculture sector in many cases aided engagement in VET and acted as a stepping stone to the completion of full qualifications. Skill sets can also be used to build additional skills, particularly those that broaden and/or deepen the skills and capabilities of already qualified workers.37 Key points

• An increase in human capital through higher level qualifications can be used effectively to improve productivity in a high value economy.

• There is a general reluctance within the food and beverage industry to view training as an investment, and employers face barriers to releasing staff to undertake training.

• A capacity to adopt new technologies will become more important as increasingly sophisticated farm technologies and production processes are developed.

• Employers are demanding work-ready graduates (and students are seeking opportunities to gain practical skills and experience), which suggests the need for wider use of work-integrated learning programs such as internships, cadetships, apprenticeships and traineeships.

• Skill sets can provide stepping stones to a full qualification. They are also an effective means of upskilling and reskilling existing workers quickly as new technologies or work practices are introduced.

Questions for discussionAre education and training providers producing graduates with the key competencies required by the industry? If not, what are the skills gaps?What strategies can be used to encourage employers to invest in upskilling and lifelong learning for their workforce?What is currently working or is a ‘best practice’ example of work-integrated learning in vocational education and training (VET) and/or higher education?How could successful work-integrated learning programs in your sector be expanded?

37Mills J, et. al., 2012, Workforce skills development and engagement in training through skill sets, National Vocational Education and Training Research Program, p 7.

32

Part 3: Skills supply and demand analysisOverview of food industry employment dataThis section provides an overview of the agricultural production and the food processing workforce. More detailed data is included in the accompanying Food and beverage workforce: Statistical appendixes at Appendixes C and D. It is acknowledged that there are issues associated with the available statistical data which impede a detailed analysis. However for consistency of analysis within this Issues Paper, published ABS data has been used. It is also acknowledged that the DEEWR projections do not cover the long-term developments that may result from export opportunities as Asian consumer demand increases. Rather, they generally represent a continuation of past trends. Ongoing dialogue regarding these issues is useful in identifying the limitations and examining alternative approaches.

Agriculture and fishing workforce: historical and projected employment growth

In 2012, just under 325,000 people were employed in parts of the Agriculture, Forestry and Fishing industry division (excluding forestry). The Agriculture sub-division accounted for the vast majority of this total (290,400). Table 1 shows that by far the largest employing sector within the agriculture sector is Sheep, Beef, Cattle and Grain Farming with 128,200 employees, accounting for 44 per cent of employment in the Agriculture sub-division.Over the past five years employment in the Agriculture industry fell by an annual average of –2.1 per cent per annum. Falls in employment were highest in Nursery and Floriculture Production, Mushroom and Vegetable Growing, and Fruit and Tree Nut Growing. DEEWR employment projections suggest a continuation of historical trends, with limited growth in the food production and food processing industry overall over the next five years. However the prospects for individual sectors will vary, as consumer preferences change and new technologies are introduced. This is consistent with the Deloitte Access Economics modelling undertaken for AWPA’s Future focus, 2013 National Workforce Development Strategy.

33

Table 1: Employment growth and projections for food related sectors within the Agriculture, Forestry and Fishing industry

ANZSIC code

Industry sub-division/Grou

pEmployed

2012

Total employment

growth 5 years to

2012

Annual average

employment growth 5 years to

2012

Projected total

employment growth 5 years to 2016–17

Projected annual

average employment growth 5 years to 2016–17

(‘000) (‘000) (%) (‘000) (%)

A0AGRICULTURE, FORESTRY AND FISHING, NFD

1.3 –0.4 –5.4 - -

01 AGRICULTURE 290.4 –15.9 –2.1 4.9 0.4

010 Agriculture, nfd 42.8 11.7 6.6 - -

011Nursery and Floriculture Production

11.8 –6.5 –8.4 –0.7 –1.3

012Mushroom and Vegetable Growing

16.6 –5.0 –5.1 –1.4 –1.5

013 Fruit and Tree Nut Growing 30.7 –11.6 –6.2 –0.6 –0.4

014Sheep, Beef Cattle and Grain Farming

128.2 –12.4 –1.8 6.0 0.9

015 Other Crop Growing 12.9 1.4 2.3 –0.3 –0.6

016 Dairy Cattle Farming 25.0 0.6 0.5 1.0 0.8

017 Poultry Farming 11.7 4.0 8.9 0.1 0.2

018 Deer Farming 0.0 0.0 0.0 0.0 0.0

019 Other Livestock Farming 10.9 1.9 3.8 0.2 0.4

02 AQUACULTURE 2.8 –1.4 –7.8 0.1 0.3

04 FISHING, HUNTING AND

6.8 –0.7 –1.9 –0.2 –0.7

34

TRAPPING

040Fishing, Hunting and Trapping, nfd

0.7 -2.0 -23.6 - -

041 Fishing 5.8 1.3 5.1 –0.2 –0.6

042 Hunting and Trapping 0.3 0.0 0.2 0.0 –2.6

05

AGRICULTURE, FORESTRY AND FISHING SUPPORT SERVICES

23.5 –2.2 –1.7 0.5 0.4

052Agriculture and Fishing Support Services

20.1 –2.6 –2.4 0.5 0.4

Notes: Historical employment data has been annualised and smoothed by way of four quarter averaging. DEEWR employment projections are based on seasonally adjusted and trended ABS labour force data from November 2011. Projections are not available for nfd categories.Sources: Australian Bureau of Statistics, Labour Force, Australia, Detailed, Quarterly, cat. no. 6291.0.55.003; DEEWR, Industry Employment Projections, www.deewr.gov.au/LMIP/default.aspx?LMIP/Publications/IndustryEmploymentProjections

Food and beverage manufacturing workforce: historical and projected employment growth

Approximately 227,900 Australians were employed across the food and beverage processing sectors in 2012. Over the past decade, employment has increased in this sector relative to other parts of Manufacturing, making it the largest employing manufacturing sector.38

Table 2 shows that, in 2012, Bakery Product Manufacturing was the largest employing sector (62,500). Since 2007–08 onwards this sector has included Bakery Product Manufacturing (non-factory based) businesses, which are arguably more closely aligned to the Retail sector.39 Other significant employing sectors are: Meat and Meat Product Manufacturing (55,700), Beverage Manufacturing (28,600) and Food Product Manufacturing nfd (25,500). nfd means not further defined.

38Food Processing Industry Strategy Group, 2012, Food Processing Industry Strategy Group: Final Report of the Non-Government Members, p. 50.

39Food Processing Industry Strategy Group, 2012, Food Processing Industry Strategy Group: Final Report of the Non-Government Members, p. 51.

35

Table 2: Employment growth and projections for food related sectors within the Manufacturing industry

ANZSIC code Industry sub-division/Group Employed 2012

Total employment

growth 5 years to 2012

Annual average employment

growth 5 years to 2012

Projected total employment

Growth 5 years to 2016–17

Projected annual average

employment growth 5 years to 2016–17

(‘000) (‘000) (%) (‘000) (%)

11 FOOD PRODUCT MANUFACTURING 199.3 2.7 0.3 1.0 0.1

110 Food Product Manufacturing, nfd 25.5 7.5 7.2 - -

111 Meat and Meat Product Manufacturing 55.7 5.0 1.9 0.8 0.3

112 Seafood Processing 1.3 –1.0 –10.3 –0.7 –8.0

113 Dairy Product Manufacturing 19.1 0.2 0.2 1.0 1.0

114 Fruit and Vegetable Processing 7.3 –2.4 –5.6 –1.7 –9.5

115 Oil and Fat Manufacturing 1.0 –1.3 –15.9 –0.3 –5.2

116 Grain Mill and Cereal Product Manufacturing 5.3 –0.3 –1.2 –0.1 –0.4

117 Bakery Product Manufacturing 62.5 –0.5 –0.2 2.3 0.8

118 Sugar and Confectionery Manufacturing 11.7 –1.9 –2.9 –0.3 –0.5

119 Other Food Product Manufacturing 9.9 –2.5 –4.4 –0.1 –0.2

12 BEVERAGE AND TOBACCO PRODUCT MANUFACTURING

29.5 2.9 2.1 0.7 0.4

121 Beverage Manufacturing 28.6 3.9 3.0 1.4 0.8

Notes: Historical employment data has been annualised and smoothed by way of four quarter averaging. DEEWR employment projections are based on seasonally adjusted and trended ABS labour force data from November 2011. Projections are not available for nfd categories.Sources: Australian Bureau of Statistics, Labour Force, Australia, Detailed, Quarterly, cat. no. 6291.0.55.003; DEEWR, Industry Employment Projections, www.deewr.gov.au/LMIP/default.aspx?LMIP/Publications/IndustryEmploymentProjections

Between 2007 and 2012, the fastest growing sector was Food Product Manufacturing nfd which grew by 7,500 (an average of 7.2 per cent per annum). Beverage Manufacturing employment also grew relatively strongly (by 3,900 or an annual average of 3.0 per cent), and Meat and Meat Product Manufacturing grew by 5,000 (an annual average of 1.9 per cent). Most other

36

sectors recorded a decline in employment between 2007 and 2012, however the declines were small in numerical terms. Looking forward, DEEWR is projecting similar trends as in the past at the sub-division level, but with slower growth anticipated. That is, Food Product Manufacturing sub-division is expected to grow by just 0.1 per cent per annum, compared with 0.3 per cent per annum over the last five years; and Beverage and Tobacco Manufacturing is expected to grow by 0.4 per cent per annum, compared with an annual average of 2.1 per cent per annum between 2007 and 2012.For those sectors that experienced a decline in employment between 2007 and 2012, most are expected to continue to decline, albeit at a slower rate. The exception is Fruit and Vegetable Processing where the rate of decline is expected to accelerate.Employment growth is expected in Bakery Product Manufacturing, Dairy Product Manufacturing, Meat and Meat Product Manufacturing and Beverage Manufacturing.

Occupational analysisTable 3 below provides information on the numbers of people employed in occupations which are important to the industry, and the employment outlook for these occupations.40 The data limitations acknowledged above also apply here.The table shows that employment is spread across the ABS occupational categories, including Managers, Professionals, Technicians and Trade Workers, and Labourers. It should be noted however that for some occupations, such as Chemists, and Food and Wine Scientists and Garden and Nursery Labourers, many of these do not work in the food and beverage sector.The largest employing occupations (at the four-digit occupation level) are: Livestock Farmers (83,500); Crop Farmers (45,900), Garden and Nursery Labourers (33,900); Mixed Crop and Livestock Farmers (33,400); Livestock Farm Workers (31,300) and Bakers and Pastrycooks (30,900).Between 2007 and 2012 employment of Farmers and Farm Managers fell by 22,300 (an annual average decline of 2.3 per cent), the falls were most significant for Crop Farmers and Livestock Farmers, followed by Mixed Crop and Livestock Farmers. On average, employment of Farmers and Farm Managers is expected to fall by –0.3 per cent per annum to 2016–17.The professional and technical/trade occupations generally experienced growth between 2007 and 2012 and this is expected to continue over the five years to 2016–17, with the exception of Chemists, and Food and Wine Scientists, and Agricultural Technicians, which are projected to experience employment declines. Within the labouring occupations, employment is expected to grow in five of the nine occupations, with the strongest growth expected in Other Farm, Forestry and Garden Workers and Aquaculture Workers.Table 3 below provides further analysis of key occupations and the accompanying Food and beverage workforce: Statistical appendixes provides an overview of key data at Appendix E.

40This data is by calendar year. The ABS releases occupational level data on a quarterly basis (February, May, August and November) and the above data is a four quarter average for each year.

37

Table 3: Occupational employment numbers, historical growth and projections

ANZSCO code Occupation

Employed 2012

Total employment

growth 5 years to 2012

Annual average employment

growth 5 years to 2012

Projected total employment

growth 5 years to 2016–17

Projected annual average

employment growth 5 years

to 2016–17

(‘000) (‘000) (%) (‘000) (%)

1 MANAGERS

12 Farmers and Farm Managers 177.9 –22.3 –2.3 –2.8 –0.3

1210 Farmers and Farm Managers nfd

13.8 5.9 11.7 - -

1211 Aquaculture Farmers 1.3 0.2 2.9 0.0 –0.5

1212 Crop Farmers 45.9 –10.2 –3.9 –0.7 –0.3

1213 Livestock Farmers 83.5 –13.6 –3.0 –1.3 –0.3

1214 Mixed Crop and Livestock Farmers

33.4 –4.5 –2.5 –0.6 –0.4

2 PROFESSIONALS

2341 Agricultural and Forestry Scientists

8.7 1.9 5.1 0.2 0.5

2342 Chemists, and Food and Wine Scientists

12.0 2.4 4.7 –0.1 –0.3

3 TECHNICIANS AND TRADES WORKERS

3111 Agricultural Technicians 2.5 0.0 –0.2 –0.1 –2.1

35 Food Trades Workers 172.5 17.8 2.2 18.7 2.1

3511 Bakers and Pastrycooks 30.9 1.9 1.3 1.5 1.0

3512 Butchers and Smallgoods

22.4 0.7 0.6 2.6 1.9

38

ANZSCO code Occupation

Employed 2012

Total employment

growth 5 years to 2012

Annual average employment

growth 5 years to 2012

Projected total employment

growth 5 years to 2016–17

Projected annual average

employment growth 5 years

to 2016–17

(‘000) (‘000) (%) (‘000) (%)

Makers

36 Skilled Animal and Horticultural Workers

124.4 7.3 1.2 8.5 1.4

3624 Nurserypersons 5.6 –2.3 –6.6 0.1 0.5

8 LABOURERS

83 Factory Process Workers 213.5 –26.3 –2.3 –15.9 –1.6

8311 Food and Drink Factory Workers 29.2 1.6 1.1 0.5 0.4

8312 Meat Boners and Slicers, and Slaughterers

11.3 –2.9 –4.4 –0.1 –0.2

8313 Meat, Poultry and Seafood Process Workers

18.7 5.1 6.6 0.3 0.4

84 Farm, Forestry and Garden Workers

112.7 –5.5 –0.9 –3.1 –0.5

8411 Aquaculture Workers 0.8 –0.5 –9.4 0.1 1.1

8412 Crop Farm Workers 22.5 –4.2 –3.4 –2.1 –2.0

8414 Garden and Nursery Labourers

33.9 –3.2 –1.8 –3.2 –1.9

8415 Livestock Farm Workers 31.3 0.3 0.2 1.5 0.8

8416 Mixed Crop and Livestock Farm Workers

3.6 –1.1 –5.0 –0.1 –0.4

8419 Other Farm, Forestry and Garden Workers

11.8 1.7 3.2 1.0 1.5

39

Notes: Historical employment data has been annualised and smoothed by way of four quarter averaging. DEEWR employment projections are based on seasonally adjusted and trended ABS labour force data from November 2011. Projections are not available for nfd categories. DEEWR Internet Vacancy Index data has been annualised for the purposes of deriving growth rates.Sources: ABS, Labour Force, Australia, Detailed, Quarterly, cat. no. 6291.0.55.003; DEEWR, Occupation Employment Projections, www.deewr.gov.au/LMIP/default.aspx?LMIP/Publications/IndustryEmploymentProjections

AWPA medium-term employment projection modelling to 2025With a view to avoiding skills shortages, improving productivity and enhancing participation, AWPA has developed a suite of scenarios for Australia to 2025 as a basis for modelling Australia’s workforce needs and developing policy to help meet those needs. The four scenarios—Long Boom, Smart Recovery, Terms of Trade Shock and Ring of Fire—outline possible, plausible futures for Australia that help us to plan for an uncertain world. The scenarios recognise the opportunities for agricultural exports from the growth in demand in Asia. In the future, in addition to supplying resources to underpin Asia’s industrial expansion, Australia will have a further opportunity to benefit through the provision of other goods and services, particularly in those sectors in which we have a competitive advantage such as in agricultural exports and education services. The scenarios suggest that the relative certainties facing Australia’s future are an ageing population, the key role of Asia, and increasing take-up of technology. However, there are significant differences in industry structure depending on which scenario eventuates. Environmental impacts and levels of protectionism are two factors which vary across the scenarios and which would result in different outcomes for the future of Australia’s food industry. An overview of the scenario modelling data for employment projections in 2025 is presented below. Table 4 shows detailed industry level employment projections to 2025 as modelled for the various AWPA scenarios. It shows that employment within the Agriculture and Fishing industry is projected to grow in only one of the scenarios, the Long Boom, at an average of 0.4 per cent per annum. Employment is expected to decline slightly (by –0.4 per cent per annum) in both the Smart Recovery and Terms of Trade Shock scenarios, and significantly (by –1.6 per cent per annum) under the Ring of Fire scenario. For the food and beverage manufacturing sub-division, employment is expected to fall under all scenarios with the exception of Ring of Fire, which possibly reflects the protectionist trading assumptions within this scenario. At the sub-sector level within agriculture, employment growth is projected for two sectors across all four scenarios: Poultry Farming and Other Crop Growing. Employment is projected to grow under three of the four scenarios in the following sectors: Mushroom and Vegetable Growing, Sheep, Beef Cattle and Grain Farming, Aquaculture, Dairy Cattle Farming and Agriculture and Fishing Support Services. For manufacturing, the only sector where growth is projected under each scenario is Beverage Manufacturing. The majority of sectors are projected to have employment declines across all four scenarios.

40

Table 4: Projected change in number employed by food related sectors, 2011 to 2025, AWPA scenarios

2011

em

ploy

men

t

Long

Boo

m

Ann

ual

aver

age

%

chan

geSm

art

Rec

over

y

Ann

ual

aver

age

%

chan

geTe

rms

of

trad

e sh

ock

Ann

ual

aver

age

%

chan

ge

Rin

g of

Fire

Ann

ual

aver

age

%

chan

ge

All-industries 11428.3 3633.6 2.0 2697.1 1.5 2824.2 1.6 1259.8 0.7

AGRICULTURE, FORESTRY AND FISHING* 337.6 17.8 0.4 –18.2 –0.4 –18.3 –0.4 –68.4 –1.6

Nursery and Floriculture Production 17.3 –6.9 –3.6 –8.0 –4.3 –8.0 –4.3 –9.4 –5.5

Mushroom and Vegetable Growing 19.3 3.2 1.1 0.9 0.3 0.9 0.3 –2.3 –0.9

Fruit and Tree Nut Growing 36.3 –16.5 –4.2 –18.5 –5.0 –18.5 –5.0 –21.3 –6.1

Sheep, Beef Cattle and Grain Farming 150.8 20.1 0.9 2.8 0.1 2.7 0.1 –21.4 –1.1

Other Crop Growing 11.5 4.9 2.6 3.3 1.8 3.3 1.8 1.0 0.6

Dairy Cattle Farming 32.6 6.3 1.3 2.3 0.5 2.3 0.5 –3.2 –0.7

Poultry Farming 13.6 7.2 3.1 5.1 2.3 5.1 2.3 2.1 1.0

Other Livestock Farming 14.6 –11.7 –10.8 –12.0 –11.5 –12.0 –11.5 –12.4 –12.6

Aquaculture 4.4 0.7 1.0 0.2 0.3 0.2 0.3 –0.5 –0.9

Fishing 6.1 –2.4 –3.5 –2.8 –4.2 –2.8 –4.2 –3.3 –5.4

Hunting and Trapping 0.6 –0.3 –3.5 –0.3 –4.2 –0.3 –4.2 –0.3 –5.4

Agriculture and Fishing Support Services 20.8 6.4 1.9 3.7 1.2 3.7 1.2 –0.2 –0.1

FOOD, BEVERAGE AND TOBACCO PRODUCT MANUFACTURING*

246.9 –44.6 –1.4 –40.5 –1.3 –28.3 –0.9 26.6 0.7

Meat and Meat Product Manufacturing 66.0 –15.8 –1.9 –14.8 –1.8 –11.7 –1.4 1.9 0.2

Seafood Processing 2.1 –1.3 –6.2 –1.2 –6.1 –1.2 –5.7 –0.9 –4.1

Dairy Product Manufacturing 25.8 –2.5 –0.7 –2.1 –0.6 –0.7 –0.2 5.6 1.4

Fruit and Vegetable Processing 9.3 –6.7 –8.6 –6.6 –8.4 –6.4 –8.1 –5.7 –6.6

Oil and Fat Manufacturing 1.8 –0.6 –3.1 –0.6 –3.0 –0.5 –2.6 –0.2 –1.0

Grain Mill and Cereal Product Manufacturing 6.5 –5.5 –12.8 –5.5 –12.6 –5.5 –12.3 –5.2 –10.9

41

Bakery Product Manufacturing 70.6 –5.5 –0.6 –4.2 –0.4 –0.2 0.0 17.5 1.6

Sugar and Confectionery Manufacturing 17.4 –10.7 –6.6 –10.5 –6.5 –10.1 –6.1 –8.3 –4.6

Other Food Product Manufacturing 15.2 –10.3 –7.7 –10.1 –7.6 –9.8 –7.2 –8.5 –5.7

Beverage Manufacturing 30.2 15.7 3.0 16.7 3.2 19.5 3.6 31.9 5.3

Source: Deloitte Access Economics, 2012, output model, October.Note: * Sub-total excludes Forestry and Logging and Forestry Support Services industry sub-divisions.** Sub-total excludes Cigarette and Tobacco Product Manufacturing industry sub-division.

Table 5 below shows employment projections to 2025 for key occupations at the Australian and New Zealand Standard Classification of Occupations (ANZSCO) four digit level as modelled for the various AWPA scenarios.

Table 5: Projected change in number employed by food workforce occupations 2011 to 2025, AWPA scenarios

2011

em

ploy

men

t

Long

Boo

m

Ann

ual

aver

age

%

chan

ge

Smar

t R

ecov

ery

Ann

ual

aver

age

%

chan

ge

Term

s of

tr

ade

shoc

k

Ann

ual

aver

age

%

chan

ge

Rin

g of

Fire

Ann

ual

aver

age

%

chan

ge

Aquaculture Farmers 2.7 0.6 1.4 0.3 0.7 0.3 0.8 –0.1 –0.3

Crop Farmers 47.6 3.4 0.5 –1.2 –0.2 –1.0 –0.1 –6.6 –1.1

Livestock Farmers 85.8 34.6 2.4 23.4 1.7 23.5 1.7 8.5 0.7

Mixed Crop and Livestock Farmers 37.3 0.9 0.2 –3.7 –0.8 –3.7 –0.8 –10.1 –2.2

Production Managers 51.7 16.7 2.0 13.8 1.7 13.9 1.7 14.4 1.8

Chemists, and Food and Wine Scientists 11.9 –0.2 –0.1 –0.8 –0.5 –0.3 –0.2 –0.3 –0.2

Agricultural and Forestry Scientists 6.1 4.3 3.8 3.4 3.2 3.7 3.4 2.4 2.4

Agricultural Technicians 1.8 0.0 0.1 –0.2 –1.0 –0.2 –0.8 –0.6 –2.6

Bakers and Pastrycooks 26.9 5.1 1.3 4.2 1.1 4.7 1.2 5.9 1.4

Butchers and Smallgoods Makers 21.9 4.1 1.2 3.0 0.9 2.8 0.9 1.6 0.5

Livestock Farm Workers 34.9 4.6 0.9 1.7 0.3 1.8 0.4 –2.1 –0.4

Mixed Crop and Livestock Farm Workers 5.6 –1.5 –2.3 –1.9 –3.0 –2.0 –3.1 –2.5 –4.2

42

Other Farm, Forestry and Garden Workers 13.7 2.0 1.0 0.8 0.4 0.9 0.5 –0.5 –0.3

Aquaculture Workers 0.9 0.4 3.1 0.4 2.6 0.4 2.6 0.3 2.0

Crop Farm Workers 27.3 –10.0 –3.2 –11.8 –4.0 –11.7 –3.9 –13.3 –4.7

Food and Drink Factory Workers 31.9 –2.3 –0.5 –3.1 –0.7 –2.2 –0.5 0.7 0.2

Meat Boners and Slicers, and Slaughterers 12.9 –3.0 –1.8 –3.2 –2.0 –2.9 –1.8 –1.7 –1.0

Meat, Poultry and Seafood Process Workers 19.0 –2.5 –1.0 –3.1 –1.3 –2.6 –1.0 –0.8 –0.3

Product Quality Controllers 15.0 –2.1 –1.0 –2.8 –1.5 –2.7 –1.4 –2.4 –1.2

Source: Deloitte Access Economics, 2012, output model, October.

Table 5 shows that employment growth is projected across all scenarios for six occupations: Livestock Farmers, Production Managers, Agricultural and Forestry Scientists, Bakers and Pastry Cooks, Butchers and Smallgoods Makers and Aquaculture Workers. For a number of process worker occupations, employment is projected to decline across all scenarios, which possibly reflects increased use of technology and the capital intensity of work, which in turn are projected to lead to higher levels of labour productivity.

Questions for discussionIn which industry sectors and occupations are you expecting to see the strongest employment growth and why?Does the employment demand analysis in this Issues Paper align with your expectations of industry growth?

Overview of food workforce skills demandThis section provides an overview of the skills profile of the food production and processing workforce, and how this has changed since 2006. The skill profile of an industry can be assessed in two ways: by the qualification profile of the workers employed in that industry and by the skill level of the occupations relevant to that industry. The latter is reflected in the ABS skill levels allocated to each ANZSCO occupation.41 The analysis considers both measures.

Agriculture and fishing production skills trends

For the agriculture and fishing workforce, while formal qualifications are becoming more important in the industry, 60.4 per cent of workers in the industry have not completed a post-school qualification (significantly higher than the all-industries average of 38.2 per cent). 41The Australian Bureau of Statistics (ABS) identifies five different skill levels where ‘skill level is defined as a function of the

range and complexity of the set of tasks performed in a particular occupation’. The ABS also states that: ‘Skill level is measured operationally by: the level or amount of formal education and training; the amount of previous experience in a related occupation; the amount of on-the-job training; and, required to competently perform the set of tasks required for that occupation.’, ABS, ANZSCO available at http://www.abs.gov.au/ausstats/abs@.nsf/mf/1220.0.

43

However, this does not imply work is unskilled with 62 per cent of employees classified as managers or professionals.42 A comparison of the 2006 and 2011 ABS census data in Table 6 shows a proportional increase in all post-school qualifications across the two census periods. While the overall number of qualified persons increased between 2006 and 2011, total employment fell. Nearly all of this fall can be accounted for by the fall in persons without a post-school qualification. This suggests structural adjustment in employment has been almost entirely restricted to those without post-school qualifications. It may also reflect retirement of older workers who are less likely to have a formal qualification. The accompanying Food and beverage workforce: Statistical appendixes provide data tables at Appendix D.

Table 6: Comparison of qualification profile for the Agriculture and Fishing sector and all-industries between 2006 and 2011 (Census data)

Level of Education

Agriculture and Fishing 2006

(%)

Agriculture and Fishing 2011

(%)All-industries

2006 (%)All-industries

2011 (%)

Bachelor or above 7.8 9.7 23.0 26.7

Advanced diploma/diploma 6.9 7.9 9.4 10.3

Certificate III/IV 15.4 17.2 18.9 20.0

Certificate I/II 1.4 1.5 1.5 1.4

With a post-school qualification 35.0 39.6 56.5 61.8

No post-school qualification 65.0 60.4 43.5 38.2

Total 100.0 100.0 100.0 100.0Source: ABS, AWPA

Table 7 shows the skill profile of the top 30 employing occupations within the industry. The final column in the table shows the skill level (as determined by the ABS) for each occupation, ranging from 1 (highly skilled requiring bachelor degree or above) to 5 (unskilled occupations). It can be seen from the previous columns in the table that, even for those occupations with a notional skill level of 1 or 2, most of the occupations on the list have a high proportion of workers without a post-school qualification. This demonstrates that individuals can work in these occupations without necessarily having the requisite qualification. However, it may suggest that there are skill gaps in the workforce, which may be inhibiting productivity improvements.

42DEEWR, 2011, Agriculture, Forestry and Fisheries industry report, http://www.deewr.gov.au/lmip/default.aspx?LMIP/Publications/IndustryReports accessed 24 January 2013.

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Table 7: Census 2011, qualification profile of top 30 employing occupations in the Agriculture and Fishing sectors

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(no.) code Title (%) (%) (%) (%) (%) (no.)

1 1213 Livestock Farmers 9.5 8.8 15.6 1.0 58.0 42.0 1

2 1212 Crop Farmers 8.9 7.4 15.0 0.9 61.7 38.3 1

3 1214 Mixed Crop and Livestock Farmers

7.9 8.6 15.2 1.3 60.6 39.4 1

4 8415 Livestock Farm Workers 4.3 4.1 18.1 2.6 64.8 35.2 5

5 8412 Crop Farm Workers 6.9 4.0 12.1 1.5 68.3 31.7 5

6 7211 Agricultural, Forestry and Horticultural Plant Operators

2.6 3.2 22.3 1.5 64.7 35.3 4

7 8416 Mixed Crop and Livestock Farm Workers

3.5 4.1 20.8 2.4 64.0 36.0 5

8 3612 Shearers 0.9 1.3 20.4 1.5 68.4 31.6 3

9 8992 Deck and Fishing Hands 2.8 3.4 22.5 3.4 53.9 46.1 4

10 8321 Packers 9.6 5.4 8.6 1.6 67.5 32.5 5

11 1210 Farmers and Farm Managers nfd

9.1 8.3 15.7 1.0 55.7 44.3 1

12 5512 Bookkeepers 18.6 14.1 10.6 2.4 46.5 53.5 4

13 8414 Garden and Nursery Labourers

6.8 6.3 18.3 2.4 60.8 39.2 5

14 5311 General Clerks 13.6 11.4 12.3 2.4 52.8 47.2 4

15 8419 Other Farm, Forestry and Garden Workers

13.4 8.2 25.6 3.9 41.8 58.2 4.5

16 3622 Gardeners 8.2 12.2 27.9 1.7 43.8 56.2 3

17 7331 Truck Drivers 1.1 1.8 22.5 1.2 67.0 33.0 4

18 1211 Aquaculture Farmers

16.9 6.3 19.5 2.2 47.8 52.2 1

19 2341 Agricultural and Forestry

59.5

16.3 5.1 0.5 15.6 84.4 1

45

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(no.) code Title (%) (%) (%) (%) (%) (no.)

Scientists

20 5121 Office Managers 18.4 14.7 13.0 3.0 44.1 55.9 2

21 5212 Secretaries 11.9 11.8 7.3 2.8 55.2 44.8 3

22 8410 Farm, Forestry and Garden Workers nfd

3.6 3.9 15.1 1.5 67.2 32.8 5

23 3611 Animal Attendants and Trainers

7.4 8.7 16.6 3.4 54.7 45.3 3

24 3624 Nurserypersons 14.5 14.7 23.4 1.6 40.3 59.7 3

25 3232 Metal Fitters and Machinists 2.0 2.8 66.1 0.8 24.7 75.3 3

26 3221 Metal Casting, Forging and Finishing Trades Workers

2.4 3.6 57.7 0.9 30.9 69.1 3

27 5511 Accounting Clerks

20.3 13.9 11.9 3.0 43.6 56.4 4

28 8313 Meat, Poultry and Seafood Process Workers

3.6 3.4 12.4 1.5 72.8 27.2 5

29 3999 Other Miscellaneous Technicians and Trades Workers

4.8 7.6 44.7 2.0 25.4 74.6 2.5

30 1421 Retail Managers 18.2 13.7 20.2 1.6 42.1 57.9 2

Sources: ABS, 2011, Census of Population and Housing; ABS Labour Force Survey custom request.

The data also suggest that of the top 30 occupations in Agriculture and Fisheries, there are only a few where the majority of the people who work in that occupation have a post-school qualification. These include; Agricultural Scientists, Other Farm and Garden Workers, Gardeners, Aquaculture Farmers, Nursery Persons, Metal Fitters and Machinists and Metal Workers.

Food and beverage manufacturing skill trends

Table 8 provides a comparison of the 2006 and 2011 Census data qualification levels for the Food Processing Industry. The proportion of workers without a post-school qualification is 54.8 per cent—significantly above the all-industries average of 38.2 per cent.There has, however, been an increase (of 4.5 percentage points) in the proportion of workers with a post-school qualification between 2006 and 2011. The increase in qualifications has

46

been greatest at the higher qualification levels. See the accompanying Food and beverage workforce: Statistical appendixes at Appendix D for data tables.

Table 8: Comparison of qualification profile for the Food and Beverage Manufacturing sector and all-industries between the 2006 and 2011 (Census data)

Level of Education

Food and beverage 2006

(%)

Food and beverage 2011

(%)

All-industries 2006 (%)

All-industries 2011 (%)

Bachelor or above 11.9 14.7 23.0 26.7

Advanced diploma/diploma

5.6 6.9 9.4 10.3

Certificate III/IV 18.6 19.4 18.9 20.0

Certificate I/II 1.7 1.7 1.5 1.4

With a post-school qualification

40.7 45.2 56.5 61.8

No post-school qualification

59.3 54.8 43.5 38.2

Total 100.0 100.0 100.0 100.0

Source: ABS, AWPA

Table 9 shows that, in general, the main employing occupations within Food and Beverage Manufacturing have the lowest ABS skill level, with very few highly skilled occupations. There are very few occupations where the majority of workers have a post-school qualification. The occupations where qualifications are most common appear to be Bakers and Pastrycooks, Production Managers, Metal Fitters and Machinists, Electricians, Specialist Managers, Butchers and Smallgoods Makers and enabling occupations such as Accountants and Advertising, Public Relations and Sales Managers.

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Table 9: Census 2011, qualification profile of top 30 employing occupations in the Food and Beverage Manufacturing sectors

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(no.) code Title (%) (%) (%) (%) (%) (no.)

1 8311 Food and Drink Factory Workers 7.1 5.0 17.4 1.8 62.5 37.5 5

2 8321 Packers 7.5 4.7 9.6 2.2 69.6 30.4 5

3 6211 Sales Assistants (General) 4.6 3.9 6.3 2.2 78.4 21.6 5

4 3511 Bakers and Pastrycooks 6.1 6.6 38.9 0.9 43.1 56.9 3

5 8313 Meat, Poultry and Seafood Process Workers 5.9 2.9 12.4 2.4 69.2 30.8 5

6 8312 Meat Boners and Slicers, and Slaughterers 1.8 1.4 22.2 3.4 63.5 36.5 4

7 1335 Production Managers 24.1 11.9 21.7 0.9 37.0 63.0 1

8 7213 Forklift Drivers 1.8 2.6 15.1 1.6 72.2 27.8 4

9 6113 Sales Representatives 19.3 11.3 14.9 1.5 48.2 51.8 4

10 3232 Metal Fitters and Machinists 1.5 4.2 80.9 0.1 11.2 88.8 3

11 7411 Storepersons 5.0 5.3 15.8 1.8 66.5 33.5 4

12 1311 Advertising and Sales Managers 43.6 10.9 9.8 1.0 30.8 69.2 1

13 5911 Purchasing and Supply Logistics Clerks 16.4 10.9 15.4 2.1 49.6 50.4 4

14 1421 Retail Managers 14.3 9.8 22.8 1.7 45.1 54.9 2

15 8112 Commercial Cleaners 4.0 2.8 11.2 1.9 73.2 26.8 5

16 1334 Manufacturers 21.4 11.3 19.5 0.8 40.8 59.2 1

17 2342 Chemists, and Food and Wine Scientists 71.3 8.1 5.5 0.3 12.0 88.0 1

18 7331 Truck Drivers 2.2 2.6 23.1 0.8 65.7 34.3 4

19 5311 General Clerks 11.0 9.3 12.0 3.2 56.6 43.4 4

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(no.) code Title (%) (%) (%) (%) (%) (no.)

20 2211 Accountants 78.9 9.6 2.0 0.5 6.5 93.5 1

21 8412 Crop Farm Workers 6.7 4.8 15.7 2.8 62.3 37.7 5

22 3411 Electricians 2.3 7.7 77.9 0.2 11.0 89.0 3

23 1399 Other Specialist Managers 46.0 13.3 15.5 1.5 18.9 81.1 1

24 5511 Accounting Clerks 19.0 11.4 11.3 2.3 49.3 50.7 4

25 8415 Livestock Farm Workers 3.8 3.6 12.4 2.2 72.6 27.4 5

26 3512 Butchers and Smallgoods Makers 1.5 1.3 42.4 0.8 46.9 53.1 3

27 1212 Crop Farmers 23.0 11.3 17.2 1.4 38.4 61.6 1

28 6391 Models and Sales Demonstrators 5.0 6.1 9.2 2.1 71.2 28.8 5

29 8393 Product Quality Controllers 18.8 7.0 12.3 1.7 53.7 46.3 4

30 7321 Delivery Drivers 5.6 4.8 17.5 1.8 65.6 34.4 4

Sources: ABS, 2011, Census of Population and Housing; ABS Labour Force Survey custom request.

Supply of skills to the industryUnder the themes of this study, the focus on human capital requires an assessment of the adequacy of the supply of relevant education and training to the food industry. This plays a critical role in determining the capacity of the food workforce to innovate and improve productivity. It is also critical in making the most of the opportunities the Asian century has to offer.The focus in this section is on entry level supply. Elsewhere in this Issues Paper we discuss the importance of upskilling of existing workers and the need to develop a culture of lifelong learning within the industry. In addition to the formal education and training courses discussed below, there is a significant amount of unaccredited training occurring within the industry, including vendor training. Further, the data below only includes publicly funded training. It is not clear how much formal training is being funded privately by individuals and firms.This section reviews recent and current commencement and completion data for both the VET and higher education sectors as they relate to agriculture and food processing courses. It also provides an outline of relevant state and territory institutional coverage of food related courses.

49

School information is not covered as part of this overview with the exception of the VET In Schools (VETiS) data. This does not mean to say that the role of primary and secondary education is not in itself critical to the future supply of skills to the food workforce. However, other studies and bodies are currently focussing on this area, including initiatives in Science, Technology, Engineering and Mathematics (STEM) education in primary and secondary schools. See for example the work of the Primary Industry Centre for Science Education (PICSE), the Primary Industry Education Foundation and the Office of the Chief Scientist. It is however important to acknowledge that the level of supply of STEM literate secondary school students impacts on the possible number of future entrants into highly skilled food workforce occupations.More detailed data and information is included in the accompanying Food and beverage workforce: Statistical appendixes at Appendix D. Again, limitations with the data (arising from the groupings of various categories) also apply to the analysis presented there.

Trends in VET food related courses

Table 10 shows that over recent years, enrolments in food industry publicly funded VET training packages have not kept pace with the general growth in VET.43 Since 2007, enrolments in food industry training packages have grown by about 2 per cent annually, compared with about 5 per cent average annual growth across all Australian Qualifications Framework (AQF) qualifications.

Table 10: VET students enrolled in selected food related training packages managed by the AgriFood Industry Skills Council

Training package 2007 2008 2009 2010 2011

Average annual growth 2007 to

2011(%)

Food Processing Industry 14,336 12,275 10,357 10,089 11,099 –6

Australian Meat Industry 11,171 11,481 12,165 11,539 10,800 –1

Agriculture, Horticulture and Conservation and Land Management

47,157 46,924 50,071 53,202 54,541 4

Sugar Milling 4 0 56 64 93 N/A

Seafood 3,013 2,478 2,098 2,178 1,987 –10

Animal Care and Management 5,444 6,394 7,105 8,298 9,399 15

TOTAL 81,125 79,552 81,852 85,370 87,919 2

Total AQF commencements 890,422 932,859 945,413 1,029,52

01,068,89

0 5

43There is limited formal data available on fee for service VET delivery by private registered training organisations (RTOs), including enterprise RTOs (eRTOs). However, it is likely that fee for service provision by private RTOs, including in-house training by eRTOs, contributes significantly to AQF qualifications delivered in the industry.

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Source: National VET Provider Collection, 2007–11. Note: significant declines and increases may be due to a training package qualification being superseded by another training package qualification.

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About 40 per cent of those enrolled in food industry training packages are undertaking courses at Certificate I and II level. Completions in food industry training packages have increased by just over 6 per cent between 2006 and 2010, a slower rate of increase than for all AQF qualifications (about 11 per cent), see Table 11.

Table 11: VET student completions in selected food related training packages managed by the AgriFood Industry Skills Council

Training package 2006 2007 2008 2009 2010

Average annual growth 2006 to

2010(%)

Food Processing Industry 2,840 3,718 3,032 3,112 2,787 0

Australian Meat Industry 3,851 3,966 3,760 4,069 4,024 1

Agriculture, Horticulture and Conservation and Land Management

9,616 10,019 10,881 12,346 13,156 8

Sugar Milling 0 0 0 0 0 N/A

Seafood 564 395 433 362 609 2

Animal Care and Management 1,560 1,630 2,166 2,617 3,063 18

TOTAL 18,431 19,728 20,272 22,506 23,639 6

Total AQF completions 292,144 319,174 351,556 393,854 443,501 11

Source: National VET Provider Collection, 2006–11. Note: significant declines and increases may be due to a training package qualification being superseded by another training package qualification.

The large difference between commencement and completion numbers suggests that less than a third of commencements lead to completion of a formal qualification, although there is some variation between training packages and qualification level. Another source of VET supply is students who undertake VET courses in schools—VETiS. Commencements in food related VETiS courses have grown by about 7 per cent per annum since 2006, almost keeping pace with the general growth in VETiS. In 2011 there were 6,443 school students studying food related VET courses. The vast majority of student commencements in VETiS food industry courses are at the Certificate I and II level (over 90 per cent). Non-food industry Fields of Education provide more access to higher AQF levels, although about 80 per cent are still at Certificate I and II, reflecting the overall entry-level nature of this type of training. While some students will finish their Certificate while at school, others will complete post-school.Apprenticeships and traineeships are an entry pathway into the industry which combines study with an employment contract. Apprenticeships and traineeships are a subset of the broader VET commencement and completion data presented above. Showing this separately aims to demonstrate the extent to which apprenticeships and traineeships are used within each of the

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food related sectors. Of the various training packages, it appears that the Meat Industry has the highest use of training contracts in comparison to the overall number of those enrolled in VET training.

Table 12: Apprentice and trainee commencements in selected food related training packages managed by the AgriFood Industry Skills Council, twelve months ending September

Training package 2008 2009 2010 2011 2012

Average annual growth, 2008 to

2012(%)

Food Processing industry 5,413 5,382 5,015 4,821 5,205 –1

Australian Meat industry 8,004 7,321 6,917 6,391 6,677 –4

Agriculture, Horticulture and Conservation and Land Management

6,753 6,865 7,996 8,155 8,300 5

Sugar Milling 0 4 0 0 0 N/A

Seafood 274 193 225 121 138 –16

Animal Care and Management 649 606 593 641 578 –3

TOTAL 21,093 20,371 20,746 20,129 20,898 0

Source: National Apprentice and Trainee Collection, December 2012 estimates, unpublished. Note: significant declines and increases may be due to a training package qualification being superseded by another training package qualification.

There has been little growth in overall apprenticeship completions in food related training packages, with steady growth in Agriculture, Horticulture and Conservation and Land Management offset by declines in Food Processing and the Australian Meat Industry training packages.

VET student employment outcomes

Of VET students employed in food related occupations six months after completing their training, the highest match is for Food Trades Workers (including Bakers, Butchers and Cooks44), where 64 per cent of those employed had studied in a food related field.

44Cooks are not a focus of this study.

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Table 13: Occupation of VET students employed six months after training by Field of Education, 2007–2012

Occupation after training (2 digit ANZSCO)Proportion who had studied in

a food related FoE (%)

Farmers and Farm Managers 62

Food Trades Workers 64

Skilled Animal and Horticultural Workers 47

Farm, Forestry and Garden Workers 55

Source: NCVER Student Outcomes Survey 2007–12 (combined years).

In terms of VET students remaining in the same field for which they trained, there is a strong fit for workers within the meat sector (61.6 per cent), which is above the all-course average. There is a weak link between students who studied seafood courses and those working in related occupations six months later (just over 15 per cent). This suggests that there is considerable wastage in some occupations/industry sectors.

VET institutional arrangements and regional coverage

The last decade or so has seen a number of regional agricultural secondary schools close along with a reduction in the number of regional TAFE colleges.For agriculture related courses, training delivery is expensive for both students and providers, especially in regional and remote locations. This is largely due to travel, sometimes small class sizes and high cost in maintaining facilities required for activities such as intensive on-farm practical training or advanced food processing machinery and equipment. The issue of the high cost of delivering agriculture related training has been raised in 2012 by both the Senate inquiry into higher education and training and the Parliament of Victoria Education and Training Committee Inquiry into agriculture education and training.45 Both inquiries produced recommendations that seek to determine the impact of funding models of VET in the agricultural and agribusiness sector with a view to ensuring adequate funding to deliver training outcomes for employees and employers.The current scope of delivery of food related training packages by state/territory and urban/regional location is shown in the accompanying Food and beverage workforce: Statistical appendixes at Appendix D. It demonstrates the importance of training for specific commodities and food processing industries located either within specific regions or with a critical mass of industry activity. For example:

• most Food Processing industry training takes place in Victoria, within the cities or regions• most Meat industry training takes place in the eastern seaboard states, and is spread across

cities and inner and outer regions• for Agriculture, Horticulture and Conversation and Land Management training, the picture is

not so clear reflecting the diverse range of training categorised under this training package. There is a spread across all states and territories and remoteness classifications

• Sugar Milling training occurs only in Queensland, largely in outer regional and remote

45Commonwealth Government, 2012, Australian Senate, Education, Employment and Workplace Relations References Committee Inquiry into higher education and skills training needs to support future demand in agriculture and agribusiness in Australia; Victorian Government, 2012, Parliament of Victoria Education and Training Committee Inquiry into agriculture education and training.

54

locations• Seafood industry training is significant in Western Australia and is largely delivered in outer

regional locations• Animal Care Management training occurs mainly in New South Wales in urban settings.

Trends in higher education food related courses

The Senate inquiries mentioned above and a number of state government reviews have explicitly examined the adequacy of current higher education and VET arrangements for the agriculture and food processing sectors. Generally, these reviews show a long term decline in the number of students enrolling in and going on to complete degrees directly relevant to the food industry. The information below provides state and territory breakdowns to show where relevant courses are offered. Having said that, the overall trends presented here mask differences between specific qualifications and across individual institutions. It is also difficult to discern trends due to the ongoing rebadging and reconfiguring of higher education products in an attempt to stimulate student demand.Australia now has a student demand policy with respect to higher education. The government no longer specifies how many undergraduate student places it will fund public universities to provide. The government now provides funding for every domestic student enrolled in an undergraduate course of study. Under the demand driven funding system, public universities will decide how many places they will offer and in which disciplines. Universities are able to make decisions about these matters based on student demand and the needs of employers. This makes it even more important to monitor student enrolments because if students are not choosing courses in areas where a shortage of supply has been identified, then additional levers might need to be used to ensure that the industry does not suffer from the imbalance. Table 14 shows that total undergraduate commencements have fallen by around 20 per cent over the last five years. Declines have occurred in each Field of Education, with the exception of Food Processing Technology.

Table 14: Higher education domestic commencements in directly food related Fields of Education, 2011

2011 commencements

Fields of education directly related to food Post graduate

5-year % change Under-graduate

5-year % change

Food Science and Biotechnology

95 –30 390 –30.0

Food Processing Technology

45 104.5

Agriculture 184 3 806 –1.8

Horticulture and Viticulture

69 –15 145 –44.9

Aquaculture 13 30 16 –51.5

Farm Management and Agribusiness

22 340 52 –50.0

TOTAL 383 -8 1454 –19

55

Source: DIISRTE higher education data collection, unpublished46

Figure 5 shows a decline in total commencements although with some fluctuations year on year. More recently for 2013, the highest level of undergraduate enrolments was reported with an increase of around 15 to 20 per cent for Agriculture degrees, although this is not yet shown in the official data.47

Figure 5: Total food related Field of Education undergraduate and postgraduate commencements 2006–2011

Source: DIISRTE higher education data collection, unpublished

In terms of higher education completions, Table 15 shows a decline in 2011 of around 20 per cent against the previous five years. All Fields of Education declined with the exception of Agriculture.

46Values below five and percentage changes dependant on values below five have been removed from the table: Food Science and Biotechnology maps to the 6-digit ASCED 019905 Food Science and Biotechnology; Food Processing Technology maps to the 6-digit ASCED 030307 Food Processing Technology’ Agriculture maps to the 6-digit ASCEDs 050101 Agricultural Science 050105 Animal Husbandry 050199 Agriculture not elsewhere classified and 059999 Agriculture, Environmental and Related Studies not elsewhere classified; Horticulture and Viticulture maps to the 6-digit ASCEDs 050301 Horticulture and 050303 Viticulture; Aquaculture maps to the 6-digit ASCEDs 050701 Aquaculture and 050799 Fisheries Studies not elsewhere classified; Farm Management and Agribusiness maps to the 6-digit ASCED 080321 Farm Management and Agribusiness.

47Atkins, J, 2013, ‘Students flock to agriculture courses’, Weekend Australian, 19 January, p. 3.

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Table 15: Higher education domestic completions in directly food related Fields of Education, 2011

2011 completions

Fields of Education directly related to food Post graduate

5-year % change Under-graduate

5-year % change

Food Science and Biotechnology 52 –32 254 –38

Food Processing Technology 7 –30

Agriculture 169 42 490 15

Horticulture and Viticulture 37 –8 125 –35

Aquaculture 11 –83

Farm Management and Agribusiness 11 38 38 –63

TOTAL 269 7 925 –23

Source: DIISRTE higher education data collection, unpublished

Figure 6 shows a decline in total completions, and for undergraduates, in food related fields of education over the last five years, although there is a slight increase in the number of postgraduates with some fluctuation between years.

Figure 6: Total food related Field of Education undergraduate and postgraduate completions 2006–2011

Source: DIISRTE higher education data collection, unpublished

Higher education student outcomes

Due to survey sample size, student outcomes are not available to the same level of disaggregation as information about commencements and completions. Of bachelor degree

57

graduates in the Agriculture Field of Education who were available for full-time work, less were likely to be in full-time employment than the average for all Fields of Education, four months after completion. The median salary for these graduates was also lower than average ($47,000 compared with $50,000). There are also lower salaries in food related occupations relative to other science based occupations, such as those offered in the mining industry. Both factors may be contributing to lower levels of graduate enrolments.

Table 16: Student outcomes, Agriculture bachelor degree graduates 2012

Males Females Total

What are bachelor graduates doing after graduation?

Available for full-time employment (%) 72.4 60 65.8

In further full-time study (%) 18 24.7 21.6

Part-time or casual employment (%) 3.9 8.7 6.5

Unavailable for full-time study or work (%) 4.9 6.0 5.5

Of those available for full-time employment:

In full-time employment: agriculture (%) 73.7 64.4 69.3

In full-time employment: all fields of education (%) 75.4 76.8 76.2

Most frequently reported occupations:

1. Design, Engineering, Science and Transport Professionals

2. Farmers and Farm Managers

3. Engineering, ICT and Science Technicians

What are bachelor graduates in full-time employment earning?

Median salary: Agriculture $47,500 $46,000 $47,000

Median salary: All Fields of Education $50,000 $49,600 $50,000

Source: Graduate Careers Australia, Agriculture, bachelor graduates

Analysis of the 2011 Australian Graduate Survey indicates that those who graduated from food related fields of education were much less likely to be working in Professional occupations, and much more likely to be working as Labourers, than the average for all fields.In 1980, Agricultural Science graduates earned the fifth-highest salary after graduation (out of 20 fields of education). By 2011, this had fallen to 18th (out of 23 fields).48

Higher education institutional arrangements and regional coverage

Figure 7 below shows the state and territory spread of aggregated Field of Education course delivery by universities, showing both commencements and completions. It shows that New

48Graduate Careers Australia, 2012, Graduate Salaries, Supplementary Table H.58

South Wales is a significant provider of higher education delivery for Agriculture courses, while not all states have universities that offer relevant courses. With the exception of New South Wales, Victoria and South Australia, all course numbers for undergraduates show relatively low levels of student participation.

Figure 7: Undergraduate commencements and completions by Field of Education and state 2011

Source: DIISRTE higher education data collection, unpublished49

The accompanying Food and beverage workforce: Statistical appendixes at Appendix D lists the universities in each state and territory that offer a degree in the fields of Agriculture, Aquaculture or Food Science. The list is not finite in terms of a supply pool. Other degrees provide people with knowledge in areas that are relevant to jobs within the industry. These include Engineering, Chemistry, Biology, Microbiology, Plant Sciences, Genetics, Biotechnology, Geology, and Physics. Graduates from these disciplines could form part of a wider supply pool, from which the food industry could draw employees. All states and territories except the Northern Territory offer Agriculture. Only South Australia, Queensland, Western Australia, Tasmania and Victoria offer Aquaculture. Although New South Wales does not offer a degree in Aquaculture, some courses in that state allow a person to

49Note Northern Territory data unavailable.59

study Aquaculture. For example Southern Cross University in New South Wales offers fisheries management as a major through their environmental science degree. Graduates could then become part of the potential labour pool.

MigrationMigration is an important source of skilled (and unskilled) workers for the industry, particularly in regional areas with seasonal labour requirements. This section contains migration visa data for various visa categories that relate to the food workforce. These include:

• Employer sponsored 457 visas• Temporary working holiday visa categories• the Seasonal Worker Program.

Analysis of the number of employer sponsored 457 visas granted for food workforce related skilled and semi-skilled occupations between 2005 and 2011 shows:

• relatively low demand from employers directly sourcing occupations such as Farmers (all occupational categories) and Food Science related occupations

• a significant number of Production Engineers, although this may include demand from Mining

• steady demand for Meat Workers variously classified.The industry regards temporary working holiday makers as critical to meeting seasonal demand for a number of agriculture commodities. The visa classes that apply are as follows:

• All Working Holiday Makers (both Working Holiday (subclass 417) and Work and Holiday (subclass 462 visa holders) may work for the full duration of their 12-month stay in Australia, but may not remain with any one employer for longer than six months

• in 2005 a second Working Holiday visa initiative was introduced that allows first time Working Holiday (subclass 417) visa holders to undertake 88 days specified work in regional Australia during their stay to acquire eligibility to apply for a second such visa.50 Specified work includes work in the Agriculture, Mining and Construction industries.

There was an increase in all Working Holiday visa categories between 2007–08 and 2011–12, with a total increase of 65,162 or 29 per cent to 222,992 visas. See the accompany Food and beverage workforce: Statistical appendixes Appendix D for data tables.Between February 2009 and September 2012 the Australian Government piloted a Seasonal Worker program, with the following results:

• 1,623 seasonal workers arrived in Australia under the pilot• 22 organisations became approved employers for the pilot • seasonal workers were placed in 35 locations across all states and the Northern Territory• seasonal workers were recruited from the following countries: East Timor, Kiribati, Papua

New Guinea, Samoa, Tonga and Vanuatu. Following the pilot, the Seasonal Worker Program has 12,000 places available over the next four years and is open to workers from nine participating countries, including Kiribati, Nauru, Papua New Guinea, Samoa, Solomon Islands, Timor-Leste, Tonga, Tuvalu and Vanuatu.The Australian Government is also running a three-year trial of the use of seasonal workers in selected regions, with accommodation providers, aquaculture ventures and cotton and cane

50A region excludes the ACT, Sydney, Newcastle, the Central Coast and Wollongong, Greater Brisbane area and the Gold Coast, Melbourne metropolitan area and Perth and surrounding area. See http://www.immi.gov.au/visitors/working-holiday/417/postcodes.htm.

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growers. Specific regions throughout Australia have been selected for each industry in the trial.First time seasonal workers recruited under the Seasonal Worker Program will have an opportunity to receive training in Australia in basic English literacy and numeracy; basic Information Technology skills and First Aid. Returning seasonal workers will have the opportunity to complete a Recognition of Prior Learning assessment against competencies at a Certificate I or II level.Key points

• Supply of skills and labour comes from a range of sources: VET (including VETiS and apprenticeships and traineeships), higher education and migration.

• Data limitations impede the drawing of any specific conclusions.• Enrolments in food industry VET training packages have not kept pace with the general

growth in VET in recent years.• Higher education enrolments show a gradual decline (although, anecdotally an upturn in

some courses has been reported for 2013).• Completion rates are low within VET and higher education.• Student outcomes data shows a significant amount of ‘wastage’, with many graduates

either not working, or working in other areas.

Questions for discussionWhat strategies do you think would improve qualification completion rates, particularly in VET?How significant is the use of skill sets, short course targeted training and non-accredited training in your sector?Is the regional delivery of VET and higher education courses meeting the demands of employers in regional Australia?How effective are migration options in addressing your skills and labour needs?

Boosting supply through workforce participation strategiesIncreasing participation rates and raising productivity are critical to addressing the economic challenges of an ageing population, and in particular the ageing workforce challenge faced by the food industry, particularly the agriculture sector.51 Improved participation in the labour force also contributes to increased wellbeing including financial security, self-esteem and social engagement for target groups.52 There is an opportunity to attract workers to the sector who are currently underrepresented. The following analysis provides some suggestions as to where the future workforce can be sourced from.

51ABS, 2012, Gender Indicators, Australia, Jan, cat. no. 4125.0, ABS, Canberra; Industries Development Committee Workforce, Training and Skills Working Group, Workforce, Training and Skills Issues in Agriculture: Final Report to the Primary Industries Ministerial Council, October 2009; ABS, 2010, Australian Social Trends September, cat. no. 4102.0, ABS, Canberra.

52ABS, 2012, Gender Indicators, Australia, Jan, cat. no. 4125.0, ABS, Canberra; Industries Development Committee Workforce, Training and Skills Working Group, Workforce, Training and Skills Issues in Agriculture: Final Report to the Primary Industries Ministerial Council, October 2009.

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Young people

There is a strong and consistent pattern of older workers in the Agriculture, Forestry and Fishing industry, with employed men aged 55 and over, twice as likely to work in the industry as younger men (7.8 per cent compared to 3.4 per cent) and for older women it is 5 per cent compared to 2 per cent of younger women.53 A range of factors including a declining number of small farms and fewer young people taking over family farms have contributed to the agriculture workforce’s high median age. Between 1981 and 2011, the proportion of farmers under 35 years declined from 28 per cent to 13 per cent.While the profile of the food processing sector is younger, this may be the result of a failure to retain workers as they age.As discussed further in Part 5, there are a number of strategies in place to attract young people into the agriculture industry involving disseminating information about the career pathways offered by the industry. The Primary Industries Education Foundation is providing national leadership in promoting primary industries in schools to attract young people to food and agriculture study and career options.54 The Primary Industry Centre for Science Education (PICSE) program includes school outreach and engagement programs such as industry placements in regional and metropolitan centres and universities.55

Women

The NFF has noted that female participation is linked to improved innovation, productivity and economic development.56 The participation rate of females in agriculture, in particular in decision-making and management roles has historically been comparatively lower than males.57 In 2011, 72 per cent of the farming workforce was male and 28 per cent were female.58 However, some traditionally male-dominated occupations such as shearing have seen a recent increase in female participation.59 Females with a bachelor of agriculture degree are paid an average of $1,500 less than their male counterparts. Only 64.4 per cent of female graduates are in full-time employment compared to 73.7 per cent for males.

Indigenous Australians

Indigenous Australians have a lower labour participation rate (55 per cent), compared to the national participation rate of 65.4 per cent.60 Agriculture and food processing jobs represent an opportunity to increase Indigenous participation, in particular in regional, rural and remote locations. A number of successful initiatives are in place, for example the Ord-East Kimberley Development Plan is delivering benefits to an area with a high level of welfare dependency by providing employment. The Ord Final Agreement includes the Aboriginal Development Package which enables the widest possible range of employment, contracting and business opportunities to be considered. This will have a positive impact on Indigenous participation in

53ABS, 2010, Australian Social Trends September, cat. no. 4102.0, ABS, Canberra.

54 Industries Development Committee Workforce, Training and Skills Working Group, Workforce, Training and Skills Issues in Agriculture: Final Report to the Primary Industries Ministerial Council, October 2009, pp. 35–37.

55 Industries Development Committee Workforce, Training and Skills Working Group, 2009 Workforce, Training and Skills Issues in Agriculture: Final Report to the Primary Industries Ministerial Council, October, pp. 8–9; Allen Consulting Group (2012), Rebuilding the Agricultural Workforce: Report to the Business/Higher Education Round Table, Melbourne, pp. 34–35.

56National Farmers Federation, 2013, Blueprint for Australian Agriculture 2013–20.

57National Farmers’ Federation, 2013, Blueprint for Australian Agriculture 2013–20.

58ABS, 2012, Australian Social Trends December, cat. no. 4102.0, ABS, Canberra.

59Neales S, 2012, ‘Shearing-shed shortage serves up a silver lining’, The Weekend Australian, 9 March.

60ABS, 2011, Labour Force Characteristics of Aboriginal and Torres Strait Islander Australians, Estimates from the Labour Force Survey, cat. no. 6287.0, ABS, Canberra; ABS, 2011, Labour Force, Australia, Dec, cat. no. 6202.0, ABS, Canberra.

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the area.61 Targeted regional programs such as the Moree Aboriginal Employment Strategy assist Indigenous people secure jobs. It has already reported successes including securing 500 jobs for Indigenous people in 2005–06.62 Regions such as Moree represent important opportunities for delivering targeted initiatives for improving Indigenous participation in food and agriculture.There are also broader programs aimed at improving the gap between Indigenous and non-Indigenous participation rates, such as the Indigenous Employment Program (IEP) which aims to increase opportunities for Aboriginal and Torres Strait Islander people through employment, business support and economic development activities.63 Some key elements of the IEP include Indigenous Cadetship Support, Indigenous Wage Subsidy, and the Indigenous Capital Assistance Scheme. Other dimensions to Indigenous participation include improving workplace inclusiveness and culture, and language, literacy and number training.64

Migrants

As discussed above, migrants play an important role in supporting fluctuating labour market needs in agriculture and food processing. Employer sponsored skilled worker temporary visas (457), working holiday visas (417) and the seasonal worker programs are used extensively to fill food and agriculture labour shortages. In terms of ongoing full-time employment, only about 11 per cent of farmers in Australia are born overseas, compared to 26 per cent of the population.65

Some businesses have found new sources of labour in regions faced with high competition for workers from mining and mining-related businesses. Companies such as Luv-a-Duck have addressed the challenge of losing staff to competing industries by sourcing international staff from countries such as South Africa and Zimbabwe. Hazeldene Chickens have drawn their workforce from countries with a non-English-speaking background such as Vietnam, Thailand, China and Burma, which has alleviated their labour shortage challenges.66

61Department of Regional Development and Lands, 2009, Ord-East Kimberley Development Plan, Government of Western Australia.

62Lockyer P, 2007, ‘Aboriginal Employment Strategy gives hope to youths’, 7.30 Report, Australian Broadcasting Corporation, 8 January, http://www.abc.net.au/7.30/content/2006/s1823591.htm [accessed 19 March 2013]; Productivity Commission (2007) Overcoming indigenous Disadvantage, Productivity Commission, Canberra, 11.4.

63Department of Education, Employment and Workplace Relations (DEEWR), 2012, ‘Indigenous Employment Program (IEP)’, http://deewr.gov.au/indigenous-employment-program-iep [accessed 19 March 2013].

64Gray M, Hunter B and Lohoar S, 2012, ‘Increasing Indigenous employment rates’, Issues paper no. 3, Closing the Gap Clearinghouse, Australian Institute of Health and Welfare, 6; DIISRTE, ‘Language, Literacy and Numeracy Program’, http://www.innovation.gov.au/SKILLS/LITERACYANDNUMERACY/LANGUAGELITERACYANDNUMERACYPROGRAM/Pages/default.aspx, [accessed 20 March 2013].

65ABS, 2012, Australian Social Trends December, cat. no. 4102.0, ABS, Canberra.

66Select Committee on Australia’s Food Processing Sector, 2012, Senate Inquiry into Australia’s food processing sector, August, the Senate, Canberra, pp. 135–7.

63

Questions for discussion:What strategies can be adopted in this sector to encourage greater participation in the industry by underrepresented groups such as young people, women, Indigenous Australians and new migrants?Why do you think some occupations (for example, agricultural support services) are attracting workers from these underrepresented groups?

64

Part 4: Supply and demand imbalancesThis section provides an overview of available supply and demand indicators for occupations relevant to the food and beverage workforce. It includes an overview of the approach taken to select key occupations and an outline of the indicators drawn on to assess the supply/demand balance of each occupation. More detail on the method used to select and analyse occupations and a full list of the indicators is included in the accompanying Food and beverage workforce: Statistical appendixes at Appendix E.This analysis is preliminary only, and will be built upon based on further analysis and industry views.

AWPA’s approach to assessing skill imbalancesThe approach used in this analysis focuses on key occupations and assesses a range of supply and demand indicators to assess whether there is a current or likely future skill imbalance (shortage or oversupply).67 The analysis focuses on the top employing occupations at the ANZSCO four-digit level for each industry sector (Agriculture and Fishing; and Food Manufacturing). Occupations are assessed against a suite of indicators which AWPA uses to determine its Specialised Occupations List (SpOL) and from an AWPA commissioned study undertaken by the National Institute of Labour Studies.68 A wide range of indicators are assessed, covering variables such as historical and projected employment growth, job vacancies, earnings, turnover, graduate outcomes, hours worked and visas issued. AWPA’s approach to workforce planning focuses on specialised occupations—those occupations where specialised skills, learned in formal education and training, are needed at entry level and in which the impact of market failure is potentially significant. AWPA considers that, for other occupations (where there is not a close relationship between particular levels and fields of qualifications and the occupations that graduates end up in), market forces should generally be effective in matching supply and demand. That said, it is still likely that improved matching of education and training to occupational destination is likely to improve productivity and worker satisfaction. Only two of the occupations listed below meet AWPA’s criteria to be classified as a specialised occupation. They are the Agricultural Scientists and Veterinarians. However, other occupations have been included here in recognition that, for industry workforce development, there is value in looking at both specialised and non-specialised occupations.69 This is important in the food industry given the interdependencies in the supply chain discussed earlier.

Assessment of Manager and Professional occupationsFarmers and Farm Managers

Farmers and Farm Managers comprise around 172,200 employees across the following occupations: Livestock Farmers; Crop Farmers; Mixed Crop and Livestock Farmers (Mixed Farmers); and Farmers and Farm Managers nfd. Livestock Farmers are the largest employing occupation with around 80,000 employees. In the past five years there has been a significant decline in employment: employment of Crop Farmers fell by –18.2 per cent, Livestock Farmers by –14 per cent, and Mixed Farmers by –11 per cent. Contrary to this trend, Farm Managers (nfd) increased some 73 per cent (however, 67Note that this analysis does not include projections for qualifications.

68Mavromaras K, Healy J, Richardson S, Sloane P, Wei Z and Zhu R, 2012, A System for Monitoring Shortages and Surpluses in the Market for Skills, Report to AWPA/Skills Australia by the National Institute of Labour Studies, Flinders University of South Australia, Adelaide, September 2012.

69AWPA, 2013, Future focus, 2013 National Workforce Development Strategy, Canberra.

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this may be an effect of ABS Labour Force Survey data collection and classification issues). Projected employment is also negative (between –1.5 and –2 per cent over the next five years). The occupational unemployment level for farming occupations is currently below the national average. Internet job vacancies over the last twelve months were stable with the exception of Crop Farmers where there has been a –39.5 per cent fall. Median earnings per week are below the national average ($931 in 2011), with an increase over the past five years on par with the national average (18 per cent), with the exception of Mixed Farmers (121 per cent increase) and Farm Managers (nfd)—again, this may be an effect of survey data collection. Graduate earnings are also below the national average. The change in hours worked against the previous year is mixed, although there is again an increase for Farm Managers (nfd). In relation to DEEWR’s skills shortage research, based on its Survey of Employers who Recently Advertised, Farm Managers were most recently assessed in December 2012 and were rated as not being in shortage. The report notes the sample was only small in scale, and focussed on Farm Managers as opposed to other farming occupations. There was an average of three suitable applicants per vacancy, with the majority being for livestock Farm Manager positions. Employers sought experienced applicants, but only 22 per cent of those surveyed held suitable qualifications. Employers also noted that there was limited transferability of skills between crop and livestock farming. Employers reported that where vacancies were difficult to fill, this related to terms and conditions of employment, particularly when recruiting near mining operations.70

Agricultural Scientists

There are around 8,900 people employed in Australia as Agriculture Scientists, with only around 27 per cent of these classified as working within the Agriculture and Fishing industry sectors. The majority are classified within the Professional, Scientific and Technical Services industry classification. In the past five years there has been an increase in employment of 28 per cent. Employment is projected to increase over the next five years by 2.5 per cent. The occupational unemployment rate is low and internet job vacancies fell some –35 per cent in the last twelve months. Labour turnover is also lower than the all-industries average. The median weekly wage is around a third higher than the average, although it increased at a slower rate over the last five years. Graduate earnings for Agricultural Scientists are lower than the average for all graduates, and increased at a lower rate than the average (2.6 against 5.2 per cent). Analysis of data for Agricultural Scientists at the ANZSCO six-digit level from the 2011 Census shows of those persons working as Agricultural Scientists with qualifications and who are in the 20 to 29 year age cohort, 52 per cent have a bachelor or above in the field of Agricultural Science. From the qualification perspective, 20 per cent of those persons with a bachelor or above as their highest qualification were employed as Agricultural Scientists. The proportion of graduates working full-time is much higher than the average, 90 against 65 per cent. There has also been a significant increase in working hours against the previous year by 57 per cent. In relation to DEEWR’s skills shortage research, the Agricultural Consultant Scientist71 occupation was most recently assessed in September 2012 and rated as not being in shortage. The survey suggested most vacancies attracted suitable applicants. The majority of employers surveyed were from private consulting firms, and the data excluded vacancies for sales

70DEEWR, 2012, Farm Managers ANZSCO 121 (part), December, unpublished.

71See DEEWR, Skill Shortage research, Agricultural Consultant Scientist (23410–11, 12) http://deewr.gov.au/occupational-skill-shortages-information-0 accessed 21 March 2013.

66

orientated Agronomists. Most vacancies required formal qualifications that varied, along with levels of field experience, and experience was generally not interchangeable between sectors. Recruitment was easier in 2012 with the proportion of vacancies filled 87 per cent compared to 45 per cent in 2011, and 13.9 applicants and 2.5 suitable applicants in 2012 compared with 6.1 applicants and 1.4 suitable applicants in 2011. Most employers surveyed commented there were insufficient numbers of graduates entering the occupation, and 15 per cent said there was difficulty recruiting Agronomists in remote locations.

67

Chemists, and Food and Wine Scientists

According to the ABS Chemists, and Food and Wine Scientists study the chemical and physical properties of substances, develop and monitor chemical processes and production, develop new and improve existing food products, and plan and coordinate the production of wine and spirits. Only 18 per cent of the workforce operates within the agrifood sector. Historically the occupation has experienced strong growth (25.6 per cent over the past five years); however employment is projected to decline by –1.3 per cent over the next five years. Labour turnover of 9.7 per cent is lower than the national average (13.1 per cent). The median weekly earnings are $1,220 which is significantly higher than the national average. Over the last five years weekly wages have grown by 13 per cent. Some 80.4 per cent of graduates are working in full-time employment.

Land Economists and Valuers

There are 11,600 people employed in this occupation. Employment is down by –23.2 per cent over the last five years but is projected to increase by 3 per cent the next five years. There has been a decline in the number of internet vacancies of –12 per cent in the last year. Average weekly earnings are around a third higher than the average and increased at the average level over the past five years. Graduate earnings are lower than the average and have increased at a lower than average rate in the last year. Average hours worked increased over the last year. Over the past five years, domestic higher education completions in Land Economics decreased by –8.4 per cent indicating that supply may not keep up with replacement demand. Land Economists and Valuers were included on AWPA’s 2012 Skilled Occupation List for migration purposes.

Veterinarians

There are 8,500 Veterinarians across Australia. Employment growth has been strong at 21.3 per cent compared to an average across all occupations of 4.9 per cent over the past five years. The occupational unemployment rate for veterinarians is 0.5 per cent which is significantly less than the national average. It is projected that employment will grow by 10.4 per cent over the next five years. The median earnings per week in 2011 for Veterinarians were $1,450 which was an increase of 32 per cent over the previous five years. The recent graduate salary of Veterinarians ($45,000) is similar to the national average of $45,120. However, 91.9 per cent of veterinary graduates are working full-time compared to the national average of 65.8 per cent. The domestic student completion rate growth for Veterinarians is at 5.9 per cent, which is higher than the national average of 2.8 per cent. There is also a high level of concordance (of 81.5 per cent) between the main field of education studies and the occupation.DEEWR’s skills shortage research shows that there is no shortage of Veterinarians in either 2011 or 2012. The research found that there was more than adequate numbers of new graduates entering the industry, but employers recruiting more experienced workers may have faced challenges. Vacancies were mainly for full-time positions, with a smaller number offering flexibility of part-time work, and 60 per cent of these vacancies were in regional areas. There were on average 3.6 suitable applicants per vacancy in metropolitan areas and 1.7 in regional areas. Veterinarians were included on the 2012 Skilled Occupation List.

Production Managers

Production Managers consists of three ANZSCO six-digit occupations, for Manufacturing, Mining and Forestry. The Production Manager (Manufacturing) is the largest employing occupation within this classification. However, the Production Manager (Mining) classification is currently rated in shortage and this may have an impact on the aggregated occupation. Over the past five years there has been a 26 per cent increase in employment of Production Managers and their employment rate is projected to increase a further 5 per cent in the next

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five years. The occupational unemployment rate is slightly above the average, whilst internet vacancies have fallen –16 per cent in the past twelve months. Median weekly earnings are almost a third higher than the average although they have increased at a lower rate (10 per cent) than the average (16 per cent) in the past five years. Graduate earnings are higher than average, however this could be attributed to those in this occupation working in Mining. Graduate earnings have remained stable. There are a very high proportion of graduates working full-time. Hours worked increased in the last twelve months. There has been an increase in the use of 457 visas granted for this occupation, peaking at 270 in 2011. It is not clear from this data however the proportion associated with Manufacturing.

Table 17: Key employment and skill shortage trends: Food workforce Manager and Professional occupations

ANZSCO code Occupation (four-digit)

Empl

oym

ent p

roje

cted

to in

crea

se

Wag

e in

crea

se a

bove

nat

iona

lav

erag

e (la

st fi

ve y

ears

)

Incr

ease

in g

radu

ate

earn

ings

abov

e av

erag

e

Prop

ortio

n of

gra

duat

es w

orki

ngfu

ll-tim

e ab

ove

natio

nal a

vera

ge

Incr

ease

in p

ropo

rtio

n of

wor

king

hour

s (p

revi

ous

year

) (%

)

DEE

WR

ski

lls s

hort

age

457

visa

s gr

ante

d in

201

1(in

crea

se o

n pr

evio

us y

ear)

1213 Livestock Farmers N N N/A Y N N Y

1212 Crop Farmers N N N/A N/A Y N Y

1214 Mixed Crop and Livestock Farmers

N Y N/A N/A N N N

1210 Farmers and Farm Managers nfd

N/A Y N/A N/A Y N N/A

2341 Agricultural and Forestry Scientists

Y N N Y Y N N

2342 Chemists, and Food and Wine Scientists

N N N Y Y N Y

2245 Land Economists and Valuers N Y N Y Y N Y

2437 Veterinarians Y Y N Y Y N =

1335 Production Managers Y N N Y Y N Y

Source: AWPA

Assessment of Technicians and Trade occupationsVeterinary Nurses

There were 11,500 Veterinary Nurses in 2011–12 of which 96 per cent were female compared to a national average of 47 per cent. There has been strong employment growth of Veterinary Nurses over the past five years at 43.6 per cent, and growth is projected to continue (by 12.6 per cent). Weekly earnings are lower than the average and increased at a lower rate over the past five years. Recent average Veternarian Nurse graduate earnings are $35,480 per annum

69

which is considerably lower than the national average of $45,120. The proportion of Veternarian Nurse graduates working full-time is only 43.1 per cent compared to the national average of 65.8 per cent.

Food trades

Two food trades have been identified as being key occupations for the industry. These are Bakers and Pastrycooks and Butchers and Smallgoods Makers. Both are defined as occupations in shortage by DEEWR’s labour market research. It is important to note though that Butchers and Smallgoods Makers do not have a significant proportion of their employment in the food industry sectors that this report is concerned with. The majority of employees work at the retail end of the sector. Only 8 per cent of Butchers and Smallgoods Makers are within the food processing sector. Both trades have weekly median earnings significantly below the national average, at $777 for Bakers and Pastrycooks and $869 for Butchers and Smallgoods Makers. The recent VET graduate earnings growth in also low at only 3.2 per cent for Bakers and Pastrycooks and 3.6 per cent for Butchers and Smallgoods Makers. Both occupations are consistently below the national average in most indicators. DEEWR has identified a slight easing of the labour market in 2012 compared with 2011. However they state the shortages are likely to persist as the factors that contribute to recruitment and retention difficulties, such as relatively low remuneration, undesirable working hours and difficult conditions, are likely to continue. Both occupations utilise 457 visas to access staff. Butchers and Smallgoods Makers had 30 granted in 2011–12 and Bakers and Pastrycooks had 270 granted. Employers were able to fill a significantly higher proportion of vacancies for Butchers and Smallgoods Makers in 2012 than in 2011 (65 per cent compared with 38 per cent). This may be due to the increase (of 20 per cent) in relevant apprenticeship and traineeship completions. There were 1.3 suitable applicants per vacancy in 2012 compared to 0.6 in 2011. Projected employment growth for Butchers and Smallgoods Makers is quite high, at 9.9 per cent over the next five years. Bakers and Pastrycooks had around 54 per cent of their vacancies filled within four weeks of advertising. Although on average 10.1 applicants applied for every Baking vacancy, only 1.9 on average were considered suitable by the employers (this is up from 1.3 in 2011). Pastrycooks recorded an average of 2.5 suitable applicants per vacancy.

Nurserypersons and Arborists

Nurserypersons have a low median weekly wage at $650. Wages are however growing for the industry, rising by 22 per cent over the last five years.DEEWR has identified the occupation of Arborist72 as being in shortage. There has been an easing of the market since 2011, though employers are still facing recruitment difficulties. 43 per cent of vacancies surveyed by DEEWR were filled in 2012, however employers only rated 0.8 per cent of applicants as suitable. DEEWR found that employers had a strong preference for employees with qualifications and experience. Employers required suitable applicants to possess a number of tickets and licences including Elevated Work Platform Licence, Chainsaw Licence, First Aid Certificate, White Card, Medium Rigid or Heavy Vehicle Truck Licence and/or a Traffic Management Ticket. Despite the difficulties in hiring qualified employees only ten 457 visas were granted for Nurserypersons in 2011–12.Data from NCVER indicates the number of apprenticeship and traineeship commencements for Arborists has increased significantly over recent years, rising from 200 in 2007–08 to more than 800 in 2011–12. Completions plateaued in 2011–12 compared with 2010–11, after rising strongly from around 90 in 2007–08 to around 230 in 2010–11.

72Arborists are in shortage at the six-digit ANZSCO level but are classified under Gardeners at the four-digit level.

70

Agricultural Technicians

Agricultural Technicians perform tests and experiments, and provide technical support to assist Agricultural Scientists in areas such as research, production, servicing and marketing. Employment has fallen in this occupation by –1.1 per cent over the past five years, however this trend is projected to escalate, with employment growth projected at –10.1 per cent over the next five years. The median weekly wage is relatively high at $1,100. This has grown by 29 per cent in the last five years. Recent graduate earnings are also growing at 10.9 per cent. Despite the projected employment decline, the domestic student completions growth is at 21.4 per cent. There were 40 457 visas granted in 2011–12.

Agricultural, Forestry and Horticultural Plant Operators

There were 18,000 Agricultural, Forestry and Horticultural Plant Operators in 2011–12, of which 12,900 were employed by the food and agriculture industry. Employment grew by 10 per cent over the past five years, and growth of 7.7 per cent is expected over the next five years. Agricultural, Forestry and Horticultural Plant Operators have a slightly higher unemployment rate compared to the national average and a more significant decline (of –26.9 per cent) in internet job vacancies over the last twelve months compared to the average of –19.4 per cent. Recent VET graduates earn slightly less ($42,670) than the national average of $45,120, but graduates work significantly longer hours per week at 51 hours compared to the average of 40 hours per week. There were no 457 visas granted in 2011–12 for this occupation.

Table 18: Key employment and skill shortage trends: Food workforce Technician and Trade occupations

ANZSCO code Occupation (four-digit)

Empl

oym

ent p

roje

cted

to in

crea

se

Wag

e in

crea

se a

bove

nat

iona

l a

vera

ge (l

ast f

ive

year

s)

Incr

ease

in g

radu

ate

earn

ings

abo

ve

aver

age

Prop

ortio

n of

gra

duat

es w

orki

ng fu

ll-tim

e ab

ove

natio

nal a

vera

ge

Incr

ease

in p

ropo

rtio

n of

wor

king

hou

rs (p

revi

ous

year

) (%

)

DEE

WR

Ski

ll Sh

orta

ge

457

visa

s gr

ante

d in

201

1 (i

ncre

ase

on p

revi

ous

year

)

3613 Veterinary Nurses Y N N N N N Y

3111 Agricultural Technician N Y Y Y Y N Y

7211 Agricultural, Forestry and Horticultural Plant Operators

Y N N N/A Y N N

3624 Nurserypersons Y Y N N/A Y N Y

3611 Animal Attendants and Trainers

Y N N N/A N N Y

3511 Bakers and Pastrycooks Y N N N/A N Y Y

3512 Butchers and Smallgoods Makers

Y N N N/A N Y N

Source: AWPA

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Assessment of Labourer occupationsThe following provides a brief overview of the most significant Labourer occupations within the food workforce. Occupations have been selected by looking at ANZSCO four-digit occupations and identifying those where the proportion employed in each sector (Agriculture and Fishing, and Food and Beverage Manufacturing) is greater than 10 per cent.While occupations classified as labourers within the ANZSCO classification do not require extensive skills or long lead times for training and education, there are still important skills and workforce development issues for many of these occupations which need to be addressed.As mentioned above, the total level of employment for a number of sectors, such as Horticulture, is largely seasonal and dependent on an itinerant and migrant workforce. Bodies such as the NFF and AFI suggest these components of the workforce are not adequately captured in official statistics. There are also some aberrations in wages data for some seasonal occupations in terms of relatively high weekly earnings but low annual income levels.

Table 19:Top employing Labourer occupations: Agriculture and Fishing

ANZSCO code Four-digit occupations

Num

ber o

f em

ploy

ed (0

00s)

Pas

t fiv

e ye

ar g

row

th (%

)

Proj

ecte

d fiv

e ye

ar g

row

th (%

)

Tota

l num

ber e

mpl

oyed

of

occu

patio

n A

ll-in

dust

ries

(000

s)

Perc

enta

ge o

f tot

al e

mpl

oyed

in

agric

ultu

re

Med

ian

earn

ings

per

wee

k (2

011)

Cha

nge

in e

arni

ngs

past

5 y

ears

(%)

National average 11.5 7.2 $931 18

8415 Livestock Farm Workers 26.1 0.8 4.1 31.4 83.2 $696 15

8412 Crop Farm Workers 21.1 –15.8 –9.6 22.4 94 $658 8

8414 Garden and Nursery Labourers

4.1 –8.5 –9.2 33.9 12.1 $661 9

8410 Farm, Forestry and Garden Workers nfd

4.2 39.8 N/A 4.7 89.9 $400 –27

8992 Deck and Fishing Hands 4 –5.2 –1.3 6.9 57.9 $1300

32

8416 Mixed Crop and Livestock Farm Workers

3.4 –22.8 –2.0 3.6 94.5 $825 34

8419 Other Farm, Forestry and Garden Workers

2.7 17.3 7.6 11.7 23.1 $879 –4

8393 Product Quality Controllers 1.9 –6.9 –13.3 15.3 12.4 $917 20

8213 Fencers 1.1 –17.8 11.0 10.5 10.5 $725 18

72

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Table 20:Top employing Labourer occupations: Food and Beverage Manufacturing

ANZSCO Code Four-digit occupation

Num

ber o

f em

ploy

ed (0

00s)

Past

five

yea

r gro

wth

(%)

Proj

ecte

d fiv

e ye

ar g

row

th (%

)

Tota

l num

ber e

mpl

oyed

of o

ccup

atio

n A

ll-in

dust

ries

(000

s)

Perc

enta

ge o

f tot

al e

mpl

oyed

in fo

od a

nd

beve

rage

man

ufac

turin

g

Med

ian

earn

ings

per

wee

k (2

011)

Cha

nge

in e

arni

ngs

past

5 y

ears

(%)

National average 11.5 7.2 $931 18

8311 Food and Drink Factory Workers

24.7 5.8 2.0 29.2 84.6 $955 20

8321 Packers 23.3 –10.7 –11.0 65.8 35.4 $685 15

8313 Meat, Poultry and Seafood Process Workers

14.9 37.5 2.0 18.6 79.9 $765 23

8312 Meat Boners and Slicers, and Slaughterers

10.9 –20.3 –1.0 11.3 96.7 $913 17

8393 Product Quality Controllers 3.3 –6.9 –13.3 15.2 21.7 $917 20

8512 Food Trades Assistants 2.3 27.1 –0.5 6.0 38.3 $483 6

Source: AWPA

In occupations such as Meatworkers there appears to be a high reliance on 457 visas. In 2011 there were 310 visas granted for the Skilled Meat Workers category, however the peak was in 2008 with 670 visas granted. Recent media suggests there will be ongoing demand for Meatworkers as new abattoirs are planned to cater for northern Australia beef cattle processing.73 In terms of changing skill needs due to new technologies there is a requirement to reskill and upskill the existing food workforce. A further skilling need relates to food safety requirements. Product Quality Controllers feature in both top employing lists for Agriculture and Fishing and Food and Beverage Manufacturing. Increasing food safety and animal handling regulations demand a skills component for this and other occupations across the food supply chain.74

Key points

• Initial analysis comparing likely future demand for labour (over the next five years) with supply from the education and training system does not indicate any widespread shortages of skilled workers within the main occupations now or in the medium term.

• Projections however do not cover long-term developments that may result from export opportunities as Asian consumer demand increases.

73Cranston M and Sprague JA, 2013, ’AACo blasts 457 fears, FTA lag’, Australian Financial Review, 16–17 March, p. 42.

74See for example the presentation from the ABARES 2013 Outlook conference from the Australian Chief Veterinary Officer, Dr Mark Schipp, 2013, International animal welfare standards and Australia’s contribution available at http://www.daff.gov.au/abares/outlook/conference-program accessed 21 March.

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• Further, recent declines in education and training completions, combined with the ageing of the workforce, may result in shortages in the future, particularly in emerging areas (which are not well covered in the existing statistical collections used for workforce planning).

• These overall figures mask labour pressures within particular regions.• It is also likely that skills gaps in the current workforce are inhibiting innovation and

productivity growth.

Questions for discussionIn your sector are there any critical jobs where there are skills and/or labour shortages?In which occupations are employers experiencing difficulty in recruiting workers?

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Part 5: Workforce development: What’s working?In its final food and beverage workforce study report, AWPA will focus on successful approaches to workforce development through a series of case studies of regional and industry initiatives demonstrating best practice. A key outcome from the study will be a set of workforce development strategies for industry, the tertiary education sector and government to increase labour force participation in both the agriculture and processing sides of the industry; promote attraction and retention; increase the availability and supply of specialist skills; improve ongoing skills development and promote the effective utilisation of food and beverage industry skills in the workplace.These strategies will identify successful approaches that are currently in place and propose collaborative and coordinated ways to extend these more broadly. The report will also cover new initiatives that could be implemented to address key workforce development issues for the industry.This section outlines AWPA’s approach to workforce development.

AWPA’s approach to workforce developmentAWPA’s strategic priorities include a remit to develop advice and strategies on workforce development at the national level and analyse current and emerging skill needs in specific sectors of the economy.75 It is intended that these functions will assist enterprises to build their capacity to develop and use the skills of their workforce to maximum advantage for the benefit of industry and the community. To support this goal, AWPA analyses skills needs in the Australian economy and provides the Australian Government with recommendations on current, emerging and future skills and workforce development needs.Any workforce development strategy depends on there being in place a collaborative approach between industry, the tertiary education sector and government and a shared agenda between all the stakeholders responsible for workforce development.Workforce development refers to more than just training. It is also about integrating business strategy, work organisation and job design. In AWPA’s view:Workforce development is concerned with the development of knowledge and skills in tertiary education; the matching of tertiary provision to the needs of industry, individuals and society; and the effective use and further development of knowledge and skills in the workplace.76

The tertiary sector plays a critical role in realising this approach, while organisations—of all sizes—can contribute, and improve job satisfaction by ensuring training is relevant to business needs, and organising work to maximise worker capabilities.

Initiatives to address food and beverage workforce development AWPA’s preliminary research and consultations have identified a large range of initiatives aimed at improving:

• food and beverage skills supply (attraction and retention)• productivity• innovation in the industry• workforce participation

75AWPA, 2012, Australian Workforce and Productivity Agency Business Plan 2012– 12, AWPA, p. 3. http://awpa.gov.au/publications/Documents/AWPA%20Business%20Plan%202012-2013.pdf, accessed 13 March 2013.

76AWPA, 2013, Future focus, 2013 National Workforce Development Strategy, AWPA, p.51.

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• workforce planning• skills utilisation • upskilling and skills development.

These initiatives, projects and programs have been developed by government, industry and education stakeholders and in many cases involve collaboration and co-funding between the sectors.They encompass a range of strategies. Some, such as the Horizon Scholarship, are focused on tertiary students and offer a generous scholarship or awards to high performing students completing relevant qualifications. Others, such as the Australian Grain Farm Leaders Program and the Developing Dairy Leaders Program provide the industry with opportunities to develop leadership skills and participate in mentoring programs. These types of programs are intended to attract and retain high achievers to the food and beverage industry by making the potential career pathways in the industry more visible. They also ensure that the next generation of agricultural leaders are trained in the practical and technical skills they will need to be successful in the future.To increase participation in the food and beverage workforce, particularly from young people entering the world of work, there has been a move to promote a positive image of agriculture to school students. By showcasing the career options available in the industry and providing opportunities for students to gain hands-on experience in science and agriculture-related industries it is hoped that they will pursue agrifood related courses in their tertiary studies.The Primary Industry Centre for Science Education is a good example of this. It operates out of 11 university-based centres and conducts four large-scale activities across Australia. These activities include:

• giving science based class presentations to show the range of careers available in science and primary industries to year 11 and 12 students

• running Science Investigation Awards in which students investigate an agrifood topic • delivering science-based professional development sessions for year 11 and 12 science

teachers• providing Industry Placement Scholarships which include a five-day industry science

induction camp followed by a five-day student industry placement over the summer holidays, involving a team of scientists in specific local industries or research organisations.77

This concept is supplemented by sector specific initiatives such as Dairy Australia’s Cows Create Careers program which has developed learning modules for high school students to encourage more students to enter a dairy education path and careers in dairy. Similarly, individual enterprises are also using training strategies to mitigate the negative impacts associated with high staff turnover. For example, a NCVER study identified the Fletcher International Exports abattoir in Dubbo as a best practice example of induction training noting that interviewed company workers had consistently reported that their workplace was a low-stress and supportive training environment.78 The company is a registered training organisation offering low level courses on site.79 Under these arrangements, the company ensures that recruitment, workforce development and training are central to the activities and strategies of senior management and that on-the-job trainers are supported in the induction and skill development of workers.

77http://www.picse.net/HUB/media/Program_to_harvest_students_for_agriculture.pdf.

78http://www.ncver.edu.au/publications/2301.html, p 31.

79http://www.ncver.edu.au/publications/2301.html, p 18.

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A number of initiatives focus on increasing productivity and innovation in the food and beverage industry by finding more efficient or effective ways to work. An example is the Australian Government’s Clean Technology Food and Foundries Investment Program, a merit-based program that helps food manufacturers to stay competitive in the context of the carbon economy by providing grants for investment in energy efficient capital equipment and low emission technologies, processes and products.80

Another key Australian Government initiative to drive innovation and growth in the industry is the forthcoming creation of a Food Industry Innovation Precinct (Food Precinct). The Food Precinct will be headquartered in Melbourne and will have an industry-led board. It aims to develop connections across the food value chain; and build business capability and the export readiness needed to take advantage of industry growth opportunities, especially in Asia.81 Focusing on innovation, it aims to increase the industry’s ability to adapt and be competitive, particularly in global markets. It will focus on removing barriers which limit the speed new ideas, technology and processes are taken up across sectors and within workplaces. The Food Precinct will build on the work of Enterprise Connect’s Food Network. The Food Network is a specialised national group, bringing together business advisers with the expertise and networks to assist businesses in the food and beverage processing sector. The objective of the Food Precinct is to increase the ‘competitiveness of food and beverage processors in local and overseas markets, including new methods of processing; accessing global market opportunities and getting the most out of supply chains’.82 To achieve this, the Enterprise Connect program offers eligible businesses a free comprehensive, confidential and independent business review to help them reach and transform their potential. Enterprise Connect has helped to build lasting capability and address gaps for large numbers of SMEs in the manufacturing sector (including food where there are opportunities for value-add and exports).At the enterprise level, a growing number of firms are using workforce development strategies to better utilise the skills of their employees. An example of this is The Chia Co, a small producer of chia seeds. It capitalises on its employees’ skills by encouraging them to share their opinions on business strategy. This includes allowing staff to market the company’s product to potential and existing customers, and providing staff with the opportunity to review their job description and suggest ways to adapt the role to support the company’s growth.83 By addressing how work is organised and how the skills of workers are aligned to the needs of the business, these skills utilisation strategies aim to improve workplace productivity.While there are examples of initiatives from across the food supply chain, our research so far indicates that certain sectors, such as dairy, have a well-developed and holistic approach to skills and workforce development which encompass workforce planning.

A coordinated approach to workforce developmentPart 1 of this Issues Paper highlighted the key issues and trends affecting the food and beverage industry now and into the future. The challenges in this sector will require the industry to further adapt as the knowledge and skills required across all aspects of the supply chain evolve. The education and training sector, government agencies, and the food and beverage industry (including peak industry groups), working in partnerships, can assist the industry to develop the adaptive capacity it will need.Yet, many of the reports referenced in this Issues Paper suggest that such a coordinated approach is not yet in place across the sector. They highlight that, despite the substantial support provided by government to address labour and skills issues and the wide range of industry initiatives in place, stakeholders are still concerned that the workforce development

80http://ausindustry.gov.au/programs/CleanTechnology/CTFFIP/Pages/default.aspx.

81http://minister.innovation.gov.au/chrisbowen/MediaReleases/Pages/industryInnovationPrecinctstocreate.aspx.

82http://www.enterpriseconnect.gov.au/industrysupport/foodnetwork/Pages/default.aspx.

83http://www.awpa.gov.au/publications/documents/Better-use-of-skills-Case-study-booklet-8-May-2012.pdf, p. 8-9.78

needs of the industry are not being met.84 This could indicate that better coordination and integration is needed to ensure that the initiatives and programs in place function more effectively and and that gaps and overlaps in service provision are minimised.There are a number of existing bodies, most notably the AgriFood Industry Skills Council whose remit is to advise the Australian Government on skills, training and workforce development issues for the industry and to initiate strategies to address identified issues. AgriFood Skills is the Industry Skills Council tasked with driving the skills and workforce development agenda across the food and beverage industry. This role involves developing and implementing workforce development strategies and nationally endorsed qualifications to meet existing and emerging skills needs of agrifood businesses, workers and students.85 In 2012 the National Agribusiness Education, Skills and Labour Taskforce was established as part of the NFF’s 2013 Blueprint for Australian Agriculture consultations. It aims to bring together key stakeholders representing the agribusiness sector including education providers, training organisations, and industry peak bodies to build a collaborative strategy for raising awareness, interest and participation in the agricultural supply chain.

Australian Government skills and workforce development initiativesThe National Workforce Development Fund (NWDF) is an Australian Government program to assist individual enterprises to increase their workforce capacity. It provides existing and new workers with opportunities to enhance their skills through formal training. The fund aims to increase the supply of labour and skills in sectors and occupations where there is a current or emerging skills need. It is a co-contribution model based on partnerships between industry and government.Stakeholders from the food and beverage industry have previously commented that the NWDF’s eligibility guidelines preclude many workers from the sector accessing the fund. As the generally accepted entry level qualification for the industry is Certificate II, the fund’s prerequisite that a trainee must have a pre-existing qualification at the Certificate III level or above is considered a barrier.86 Stakeholders have also commented that the NWDF’s restriction on funding of skill sets is another barrier to workers accessing training in emerging skill areas. AgriFood Skills’ 2013 E-Scan proposes the NWDF should fund the delivery of units of competency, and nationally recognised skill sets, to meet the identified needs to individual enterprises and learners.87

AWPA recognises that Certificate II is a key entry point for industries such as the Meat industry, Food Processing industry and Agriculture. The NWDF’s existing guidelines do allow for funding to be provided to allow Certificate II to be offered to new workers. The guidelines state that the Minister responsible for tertiary education and skills may provide waivers to the eligibility criteria, including a waiver for a Certificate II to be offered to existing workers, if a business case outlining the reasons for the waiver is submitted as part of the application process.88

In addition, the NWDF’s co-contribution funding model has been identified as a disincentive for

84Commonwealth Government, 2012, Australian Senate, Education, Employment and Workplace Relations References Committee Inquiry into higher education and skills training needs to support future demand in agriculture and agribusiness in Australia; Victorian Government, 2012, Parliament of Victoria Education and Training Committee Inquiry into agriculture education and training.

85http://www.agrifoodskills.net.au/?WhoWeAre.

86AgriFood Skills 2013, 2013 E-Scan, AgriFoods, [to be released in June 2013].

87AgriFood Skills 2013, 2013 E-Scan, AgriFoods, [to be released in June 2013].

88Australian Workforce and Productivity Agency (AWPA) (2013) Future focus, 2013 National Workforce Development Strategy, AWPA, p 63.

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businesses wanting to access the funding, particularly micro businesses (fewer than five employees), who may be deterred by the 30 per cent contribution required from them.89 Program data for the NWDF for 2011–12 does not include data on uptake by micro businesses; however, it does show that approximately 56 per cent of learner enrolments are from businesses with less than 100 employees. Learner enrolments from small businesses with fewer than 20 employees, is around 30 per cent.90 AWPA’s Future focus, 2013 National Workforce Development Strategy recommends that joint funding between Enterprise Connect and the NWDF be explored to achieve greater alignment of business improvement and skills programs to support SMEs.91

There are innovative examples of the food and beverage industry using the NWDF to promote a workforce development and planning approach within the sector. In 2011–12 AgriFood Skills was allocated over $4 million from the NWDF to run the AgriFood Skills’ National Regional Initiatives (NRI) in four regions across Australia (chosen by state governments based on AgriFood Skills’ criteria) with the program set to run until 30 June 2014. The NRI program has grown out of a successful Make it Work cross-industry initiative, a three year pilot program in Narrabri (northwest NSW) which was driven by a partnership involving AgriFood Skills, SkillsDMC, Narrabri Chamber of Commerce and the Narrabri Shire Council. The NSW Department of Industry and Investment provided initial co-partners funding support for the pilot. The pilot clearly demonstrated the power of industry, enterprise and community leaders working together to provide innovative and sustainable solutions to regional skills and workforce challenges. This included developing an ‘employer of choice’ initiative to build employer capability, as well as a skills demand calendar for the region. A further initiative involved the training of sixteen mature-age under and unemployed people in a short rural operations course that enabled them all to be employed on graduation. The outcomes of the Narrabri pilot were independently assessed by ACILTasman and indicated a productivity gain of 3.2 per cent per annum and a net reduction in migration from the region of 33 per cent. This Narrabri project was so successful that it is being replicated in four other major regions around Australia as AgriFood National Regional Initiatives. These initiatives are a collaborative and cross-industry approach to enable regions to work with government and training providers to share intelligence and develop regional solutions to secure and sustain a skilled workforce.92

The project will use a place-based approach and will work with the local community in four regions (Loddon Mallee in Victoria, Western Downs in Queensland, Warren Blackwood in Western Australia and the Eyre Peninsula in South Australia) to find the most locally appropriate strategies.The Workplace English, Literacy and Language (WELL) Program is the Australian Government’s main program for providing language, literacy and number (LLN) training in the workplace. The program supports employees whose level of LLN skills impacts on their capacity to perform workplace tasks and/or work related training. WELL Brokers are a key distribution channel for WELL, and one is contracted to both AgriFood Skills and Manufacturing Skills Australia. AgriFood Skills has noted that the geographically dispersed nature of the food and beverage industry workforce means enterprises often have limited access to appropriate LLN training and expertise. Further, it notes that industry has a training subculture of building skill sets for

89AgriFood Skills 2013, 2013 E-Scan, AgriFoods, [to be released in June 2013] and Food, Fibre and Timber Industries Western Australia, Submission to the National Workforce Development Strategy, Focus discussion paper.

90Department Industry Innovation Science Research Tertiary Education (DIISRTE) (2012) National Workforce Development Fund program data to 30 September 2012, based on preliminary unaudited data received in November 2012. These figures do not include the 5 per cent of total organisations that did not report their size. When organisations that did not report their size are removed from the total, the proportion of enrolments from businesses with 0–19 employees was 31.6 per cent, and the proportion of enrolments from businesses with 20–99 employees was 27.3 per cent.

91AWPA, 2013, Future focus, 2013 National Workforce Development Strategy, Canberra, p. 57.

92AgriFoods Skills, 2013, AgriFood Skills’ National Regional Initiatives, http://www.agrifoodskills.net.au/?page=AgriFoodNRI, accessed 1 March.

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immediate tasks at hand, and that the high proportion of the seasonal or intermittent workers means it is not always practicable for some business, particularly SMEs, to release workers to attend LLN training.In recognition of the need to increase support for foundation skills training in the workforce, AgriFood Skills is developing and trialling resources and foundation skills assessments within core units of Certificate I to III qualifications from the new AHC10 Agriculture, Horticulture and Land Management Training Package.93 Key points

• There is a wide range of existing workforce development and skills initiatives being managed by stakeholders, however, coverage is not consistent—some sectors are more advanced than others in their workforce development thinking.

• Other initiatives have never got off the ground or have ceased due to funding or other policy decisions.

• For some initiatives, such as scholarships, competition is fierce and funding is tight.• There are successful examples of education, industry, government partnerships but

coordination and management appears to be an issue.• Stakeholders have raised a number of concerns regarding the NWDF that should be

explored to help the fund meet the needs of this industry more effectively.The workforce development plan for the sector, which is being developed as part of AWPA’s food and beverage workforce study, will look more closely at what is and isn’t working and will make recommendations about future initiatives, policies and structures to support the future development of the food and beverage industry.

Questions for discussionDo the workforce development initiatives currently operating in your sector support good skills development?What are the gaps in service provision and areas of duplication?How could the National Workforce Development Fund better support the food and beverage industry to lift productivity?What mechanisms could be introduced to support a more coordinated approach to workforce development?Given the high proportion of food and beverage businesses located in regional Australia, what strategies could be used to promote a cluster-based workforce development approach? Are there regions or sectors where this would not be appropriate?How can the food and beverage industry be supported to increase its investment in language, literacy and numeracy training for its workforce?

93http://www.isc.org.au/pdf/NoMoreExcuses_FINAL%20single%20page.pdf.

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Part 6: How to provide feedback on this Issues Paper AWPA is undertaking a study of skills and labour issues in the food and beverage industry. This study will develop a workforce development plan for this sector and will encompass agricultural production and food and beverage processing—to support higher food exports and meet growth opportunities in the Asian century.AWPA’s final food and beverage workforce study report is due to be released in late 2013. The report will incorporate findings from stakeholder submissions and consultations, including further examples of successful workforce development initiatives showcased through a set of case studies.This Issues Paper is the first output of the study.This Issues Paper is intended to stimulate discussion and debate, and to confirm (or challenge) issues identified here and in related studies. To this end, AWPA is inviting interested stakeholders to respond to the ideas and questions in it by emailing a submission to foodstudy@awpa.gov.au by 7 June 2013.

AWPA would also like you to share any ‘best practise’ case studies with us that demonstrate successful approaches to food and beverage industry skills development and skills utilisation. We’d also like to hear from you about gaps and what’s not working.These case studies should also be emailed to foodstudy@awpa.gov.au by 7 June 2013.

Please visit www.awpa.gov.au/our-work/sector-specific-skill-needs to download the electronic forms which you should fill out to provide feedback.

Four your information these forms are also attached to this Issues Paper at Attachments A and B.AWPA will seek the express permission of organisations to include particular case studies in its final report.Please contact foodstudy@awpa.gov.au if you require further information.

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