Growers and suppliers will look to employ less staff as a way of countering increased costs caused by the raised Living Wage, according to one senior industry figure.
Chairman of Berry Gardens, Alastair Brooks, was speaking at yesterday’s Fruit Focus (22 July) about the 2015 berry season and issues currently affecting the industry.
He said the wage increase, announced recently by chancellor George Osborne, is a “huge concern for our growers” and discussed ways companies will look to absorb costs.
“In the current retail environment, price inflation is not an option. We will have to absorb the costs. It is the perfect storm – as well as our increased labour costs, the euro will only become more competitive meaning imported fruit may become more appealing.
“Growers will absolutely look to employ less people. This won’t just be pickers, but also other areas of the business such as spray operators. If you can use one larger spray operator you will be able to employ less people,” he said.
Asked what the government should be doing to better support the industry, Brooks said “there is a discussion to be had” about the reality of a Living Wage for someone living in London, compared to a worker living in the countryside in subsidised accommodation.
Brooks was joined at the Berry Gardens briefing by managing director, Nick Marston, who explained: “The issue is not how much people are paid, but the incentive side of it. By paying the new Living Wage, growers are less able to offer higher incentive payments.”
Marston also noted that larger fruit sizes, such as those offered by new strawberry variety Driscoll’s Elizabeth, will help speed up picking times – another way of countering higher wages.
“As an industry we will be able to cope,” Brooks said, adding that tree manipulation techniques are further examples of how innovation can help growers cut labour costs.
Brooks said that 40 per cent of Berry Gardens’ members have switched to table top production, while the remaining 60 per cent risk becoming unprofitable if they do not move away from labour-intensive traditional ground production.
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