Workforce paradox: Vacancies persist as labour market softens

There is evidence of a workforce paradox in operation: there is a growing body of people out of work and looking for work, and at the same time food system employers still seem to be struggling to find the people they need to answer the challenges of today and tomorrow.

Clearly, something is not working. Something could be preventing unemployed people from coming together with food and drink businesses that need workers.

What’s happening?

The UK labour market has been softening for some time – low vacancies, low intention to recruit, slow pay growth, and other symptoms.

The number of unemployed people is creeping up slowly and there is also a large body of people considered economically inactive (i.e. not in work and not looking for work).

This body of inactive people greatly outnumbers the unemployed (i.e. not in work but looking for work), by about 9.0m to 1.9m.

Unemployment

Rising unemployment is common when the economy performs poorly. Similarly, demand for labour tends to rise when performance picks up.

However, these cyclical factors, which regulate demand for labour, are not the only forces at work in the labour market, structural factors also play a part.

Structural factors describe the fit between the number and type of workers required and those actually available and willing. Variables can include:

• Benefit and tax system - The level of benefit payments available and the conditions attached will drive decisions around working or not working. The tax system will have similar effects.

• Culture - There may be mismatch between the expectations or aspirations of potential workers and the opportunities actually available.

• Geography – There may be mismatch between the location of vacancies and the location of potential workers. There may also be difficulty in moving workers to locations of jobs.

• Skills – There may be mismatch between the skills needed and the skills of the potential workforce – this could include both hard and soft skills.

Structural factors are not easily rectified and nor do they go away. They require concerted policy activity by government to resolve them.

Basic data such as unemployment rates provide a valuable, but limited insight into the behaviour of the labour market. Full understanding requires a richer, more holistic view.

Food and drink issues

Although the labour market is quite weak, the UK food system faces persistent recruitment challenges at every point in the supply chain.

Food and drink employ about 4.1m people in the UK (about twice as many people as the NHS). HR teams face a constant challenge to back-fill, replacing those that leave. This can be difficult.

This back-filling task is the challenge for today - it is crucial to maintaining productive capacity and is therefore essential to maintaining service, choice, and food security.

Looking ahead, there is also the challenge for tomorrow – workforce evolution. The food and drink system must evolve to be future-fit, and this will require workers with the right skills.

Some of these new skills may be found by recruiting new personnel but it is likely that many skilled personnel will be manufactured, by re-skilling current workers.

Barriers to working in food and drink

This issue has been explored before. The Shropshire Report into The Independent Review Into Labour Shortages In The Food Supply Chain suggested several issues that affect recruitment into agriculture and manufacturing:

• Antisocial hours.

• Difficult access (e.g. remote sites).

• Difficult environments (e.g. cold stores, open fields).

• Hard physical work.

• Lack of career progression.

• Low pay and status.

Low pay is a perennial issue. Perceptions that pay is low may be well-founded; data from the ONS ASHE report shows that pay in the food system is, in fact, often fairly low paid versus other industries.

IGD’s own research, Food and Drink workforce – a quiet crisis building? suggests a more complex set of issues at work, with lack of knowledge or connection to the food supply chain being a barrier to recruitment:

• Competition from other industries.

• Disjointed messaging.

• Lack of direction (e.g. parents, teachers).

• Lack of knowledge (e.g. types of roles available).

• Low exposure / no personal experience.

Combining the Shropshire Report and IGD’s own research, it is clear that the issue is not a lack of potential workers.

There are structural limitations – a complex web of them – that make it difficult to fill current and future vacancies from job seekers.

Feeding Britain’s Future

To address this, IGD is relaunching Feeding Britain’s Future in summer 2026. This is a coordinated, cross‑industry movement to help tackle the workforce and skills challenge by bringing industry, educators, and communities together to build a confident, skilled, and future‑ready workforce.

By getting involved, employers can help open doors for young people and build the resilient, future fit workforce the sector needs.

For more information or to understand how your organisation can get involved, please do get in touch.