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Skills Action Plan for the

Food and Beverage Sector


Towards a high skill, high wage, high value economy
REPORT TO THE FOOD AND BEVERAGE TASKFORCE FROM THE SKILLS WORKING GROUP
JULY 2006

PREFACE

The Food and Beverage Skills Working Group was established to support the Food and Beverage Taskforce. Members of the
Group are as follows:
NAME ORGANISATION
Carol Beaumont (co-chair)

New Zealand Council of Trade Unions

Alison Dalziel (co-chair)

Department of Labour

Peter Harris

Taskforce Secretariat

Alison Quesnel

Blackmores Ltd

Carl Ammon

New Zealand Industry Training Organisation

and Industry Training Federation

Hugh Campbell/Cheryl MacGregor

New Zealand Trade and Enterprise

James Ritchie

New Zealand Dairy Workers Union

Jo Wills/Nick Brownsword

Fonterra Co-operative Group Ltd

Paul Pearson/Paula White

Tertiary Education Commission

Mark Jefferies/Allan Frazer

Meat and Wool New Zealand Ltd

Jo Sceats

Department of Labour

Barbara Johnsen

Seafood Industry Training Organisation

Carolyn Holmes

Ministry of Education

Peter Ettema

Ministry of Agriculture and Forestry

Kay Nelson

Wellington Institute of Technology

Contributors to the skills and training workshops included the Agriculture Industry Training Organisation, Competenz,
Lincoln University, AgResearch, Horticulture Industry Training Organisation, the Tertiary Education Commission, the
Department of Labour, New Zealand Trade and Enterprise, the New Zealand Council of Trade Unions, Business New Zealand,
and the Beer, Wine and Spirits Council of New Zealand.
The Skills Working Group would like to acknowledge Jo Sceats from the Department of Labour for preparing this report
on its behalf.

ISBN 0-478-28065-3

CONTENTS

PREFACE

CONTENTS

CHAIRS LETTER

EXECUTIVE SUMMARY

Skills Action Plan for the Food and Beverage Sector

Implementation

INTRODUCTION

10

FOOD AND BEVERAGE EMPLOYMENT

15

Background

15

Transformation Theme

16

Key Facts about the Food and Beverage Sector

16

SKILLS WORKING GROUP PRIORITIES

22

1. Better Labour Market Information

22

1.1 Forecasting Framework

22

1.2 Productivity

26

1.3 Skill Shortages

31

2. More Strategic Investment in Training

36

2.1 Workplace Practices

36

2.2 Community Awareness

36

2.3 Responding to Changing Occupations and Skill Needs

37

2.4 Quality and Relevance

38

3. Attractive Careers

41

3.1 High Quality Workplaces and Career Opportunities

41

3.2 PhD Integration

42

APPENDIX 1: Australia/New Zealand Standard Industrial Classification

44

APPENDIX 2: Ways to Address Skill Shortages

47

APPENDIX 3: Explanations of Terms and Sources

49

CHAIRS LETTER

Mr Tony Nowell
Chairman
Food and Beverage Taskforce
WELLINGTON

Dear Tony,
The Skills Working Group strongly supports the transformation theme (i.e. towards a high skill, high wage and high value
economy) for the food and beverage sector. While it is possible to win new international markets and develop innovative
products and services, it will be difficult to achieve this without the right skills, in the right place at the right time, being
applied in productive, high quality workplaces.
If the food and beverage sector in New Zealand (20% of the total New Zealand workforce) attracts and develops its
workforce effectively, this will make a major contribution to the governments economic transformation agenda. The
benefits it will provide for the New Zealand economy include spin-off effects for other related sectors such as health,
hospitality and tourism.
There are significant labour market opportunities for the food and beverage sector that the Food and Beverage Taskforce
could consider, such as:
supporting improvements in business productivity;
improving science and technology adoption practices;
applying a forecasting framework for sustainable labour to better manage turnover;
increasing integration of foundation skills into education and training provision;
increasing support and encouragement for the uptake of relevant vocational qualifications (including higher
level qualifications) that provide a good match to associated job opportunities;
increasing collaboration among Industry Training Organisations (ITOs), Tertiary Education Institutions (TEIs) and
government agencies;
improving planning and resource utilisation for training investment;
implementing strategies to address genuine skill shortages and recruitment and retention difficulties;
improving career development, employment opportunities and employment security; and
continuing and extending active support for alternative employment, preferably in the food and beverage sector,
with tailored programmes for individual workers and investment in education and training for employees affected by
business closures, downsizing and relocations. This would involve working with employers, unions, ITOs, other education
providers and agencies of government and local government.

A number of these opportunities were identified during the taskforce consultation process and have been reflected in the
Skills Action Plan for the food and beverage sector.
Given the momentum that has built up around the food and beverage sector engagement, it would be beneficial for the
sector if key stakeholders continue to have strategic dialogue in support of implementing agreed initiatives in the Skills
Action Plan.
The Skills Working Group therefore supports an ongoing food and beverage sector organisation to oversee implementation
of the Food and Beverage Sector Development Agenda. This organisation would actively lead transformation throughout
the sector; connect with other related sectors; and gain sector buy-in to own and maintain transformation in future years.
It is proposed that a new industry-led group be established called the Skills and Training Action Group (STAG) that will
consist of the relevant education and training organisations, industry and government agencies. This group would oversee
implementation of the Skills Action Plan within the context of the Food and Beverage Sector Development Agenda. The
scope of the group would include collaboration among food and beverage education and training providers to achieve more
focused provision; improve the level of knowledge about the workforce in the food and beverage sector (eg. forecasting
and areas of short supply and high demand); encourage workplace best practice initiatives (eg. productivity and foundation
learning) and increase alignment between provision of food and beverage qualifications and actual job opportunities within
the sector.
In addition to STAG, a tripartite initiative, based in the New Zealand Council of Trade Unions, is proposed. This would
establish a workforce centre of excellence for the food and beverage sector. The centre would promote worker
engagement and commitment to deliver the Food and Beverage Taskforce Development Agenda. The Skills Working
Group supports this proposal and the opportunity for STAG to both inform and be informed by the centre.
In the meantime, the Skills Working Group will continue meeting over the next few months to monitor three remaining
major projects (ie. the productivity study, the science and technology adoption research, and the career-of-choice stocktake). A progress report will be provided against the Skills Action Plan once the three major projects have been completed
and STAG has been established and operational for at least three months. The report will also include an outline of how
implementation of the Skills Action Plan will be monitored going forward.
The group has identified key skills and training issues for the food and beverage sector ways to lift its performance and
increase value. We commend the Skills Action Plan to the Taskforce.

Carol Beaumont

Alison Dalziel

New Zealand Council of Trade Unions

Department of Labour

EXECUTIVE SUMMARY

Food and beverage key stakeholders support the need for


transformation in order for food and beverage companies
to survive in a competitive, global market by:
attracting and retaining suitable and sufficient
numbers of employees;
up-skilling current workers and providing career
pathways;
integrating and applying top talent;

innovating and making effective and efficient use of


technology;
predicting skill and labour needs; and
enabling labour and capital growth in a productive
manner that supports changing demands of food and
beverage customers.
The Skills Action Plan (below) is being incorporated into
the Food and Beverage Taskforce Development Agenda.

Skills Action Plan for the Food and Beverage Sector


Priority 1: Better Labour Market Information

Forecasting
The food and beverage forecasting framework will be implemented and applied to all food and beverage
sub-sectors and maintained on an ongoing basis. This would involve food and beverage ITOs (as part of their
strategic skills leadership role) to assist in the implementation of the framework in conjunction with other
relevant organisations.
The proposed Skills and Training Action Group (STAG) will guide consistency of application of this framework
within the food and beverage sector, improve the framework and test its robustness with respective industry
organisations and training organisations.

Productivity
Complete the productivity study currently underway, which will identify productivity issues specific to food
processing businesses.
The New Zealand Council of Trade Unions will use the findings of the productivity study to inform the Workplace
Productivity Education Programme and in developing resources for union delegates and future productivity
initiatives.

A first phase of science and technology adoption research has been completed. The findings will be taken
forward with industry and relevant agencies.

Skill Shortages
Information has been gathered for the Skills Working Group on genuine skill shortages and recruitment and
retention difficulties for bakers, butchers, chefs, dairy farmers and dairy farm workers, and food technologists.
Appendix two outlines ways to address these issues. The Skills Working Group will consider how to best promote
these solutions.
Efforts will continue to improve the quality of labour market information about skill shortages in the food and
beverage sector to better inform tertiary education and training strategies and priorities.

Priority 2: More Strategic Investment in Training

Workplace Practices
Promote and explore industry best practice and incentives in relation to skills development.
Increase employee participation in training and support for the Council of Trade Unions Learning
Representatives Scheme.

Community Awareness (also see priority three Attractive Careers)


Develop learning resource materials for curriculum in primary and secondary schools that reflect the
importance of the food and beverage sector as a major employer and contributor to New Zealands economy.
Promote careers to parents, youth, teachers and careers advisors that reflects the reality of working in the
food and beverage sector (ie. how sophisticated jobs are now).
Support initiatives from the Human Capability Group in Horticulture and Agriculture, which involves a schools
curriculum strategy with goals to increase the profile of the sector, change schools perception of the sector,
increase the number of people seeking careers in the sector (eg. more science students), and introduce
resources across the curriculum. In addition and alignment with this work, it is intended to encourage a
coordinated cross sectorial approach to career promotion in schools.

Responding to Changing Occupations and Skill Needs


Explore ways to improve the ability of the skills and training system to adapt to rapidly changing and new
occupations.
Increase support for initiatives that could be undertaken by Learning Representatives and build on current
work with a group of ITOs to integrate literacy training with industry training (eg. in seafood and agriculture).

Communicate the relationship between high levels of foundation skills in food and beverage businesses and
favourable productivity results.
Increase support and encouragement for the uptake of relevant vocational qualifications (inclusive of higher
level qualifications) that provide a good match to associated job opportunities.
Continue and extend active support for alternative employment (preferably in the food and beverage sector)
with tailored programmes for individual workers and investment in education and training for employees
affected by business closures, downsizing and relocations. This would involve working with employers, unions,
ITOs, other education providers and agencies of government and local government.

Quality and Relevance


The Skills Working Group recommend in relation to the tertiary reform process, that funding must be linked to
the new Tertiary Education Strategy and the Statement of Tertiary Education Priorities. This should include a
stronger feedback loop between the Tertiary Education Commission (TEC) and industry and a greater capacity
for ITOs to influence funding and priority setting.
The TEC and other government agencies will facilitate greater partnering of delivery between ITOs and Tertiary
Education Institutions (TEIs) to better meet industry needs and enable them to be more responsive to emerging
demand through its profile negotiation process and support for the ITO leadership role.
Review the quality and relevance of the large number of food and beverage related qualifications with a
view to consolidating them into a smaller number of higher quality courses. In specialist areas, the option of
consolidating into one centre of excellence in New Zealand should be considered (eg. fishing, dairy and meat
processing and grape processing).
Review the relationships amongst polytechnics, ITOs, industry and unions in setting food and beverage related
qualifications and ensuring quality and relevance of training.

Priority 3: Attractive Careers

High Quality Workplaces and Career Opportunities


The Department of Labour will contract a stock-take of current initiatives in the areas of improving the
attractiveness of careers in this sector and promoting opportunities offered. The findings of the stock-take
will be shared with industry.
Involve unions in developing solutions including the establishment of industry standards and the uptake of
technology and other productivity improvements to assist in improving productivity, wages and conditions and
therefore recruitment and retention.
Tailor education and training provision for the food and beverage sector to include an increased focus on
developing management and leadership capability, including the development of mechanisms to grow this
capability over time.

PhD Integration
The Science and Technology Adoption project has considered the impact of the presence or absence of PhD
students (or such qualified staff), on businesses ability to adopt science and technology.

Over the next few months it is proposed that the Skills

anticipated STAG will have a role in collaboration among

Working Group continue meeting to monitor progress

food and beverage education and training providers to

and completion of three remaining major projects (ie.

achieve more focused provision, by improving the level of

productivity study, the science and technology adoption

knowledge about the workforce in the food and beverage

research and the career of choice stock-take) and

sector (eg. forecasting and areas of short supply and high

provide a progress report against the Skills Action Plan.

demand); encouraging workplace best practice initiatives

The progress report will also include an outline of how

(eg. productivity and foundation learning); and increasing

implementation of the Skills Action Plan will be monitored

alignment between provision of food and beverage

going forward.

qualifications and actual job opportunities within the


sector.

IMPLEMENTATION
A new industryled group called the Food and Beverage
Skills and Training Action Group (STAG) is proposed to

There is a general willingness of food and beverage related


ITOs, unions and government agencies to work more
closely together.

be established to oversee implementation of the Skills

STAG will take issues to Skill New Zealand (a TEC supported

Action Plan.

initiative involving the New Zealand Council of Trade

STAG will consist of the relevant education and training


organisations, industry and government agencies. It is

Unions, Business New Zealand and government agencies)


as needed to promote awareness about potential training
options and the need for industry support.

In addition to STAG, it is proposed that a Workforce


Centre of Excellence be established, based in the New
Zealand Council of Trade Unions. The centre would be
governed by a steering committee with Government,

Building from existing activity and knowledge


Developing confidence of workers that their needs and
aspirations are reflected in transforming the sector.

Business, New Zealand Council of Trade Unions, ITOs

The centre will develop a model of worker involvement in

and other relevant industry organisations. The centre

industry development that:

of excellence would ensure worker engagement and


commitment to the delivery of the Food and Beverage
Sector Development Agenda. The Skills Working Group
supports this proposal and the opportunity for STAG
to both inform and be informed by the centre.

Drives the development agenda set out by the


Taskforce
Integrates a range of initiatives that are relevant
to that development agenda (eg. skills enhancement,

The centre would include complementary actions in three

foundation learning, health and safety, productivity,

interacting and overlapping fields:

partnership)

Skill and engagement of the labour force

Promotes engagement and participation at all levels


in the sector

Innovation and improved application of best available


technologies

Develops and promotes best practice in the workforce


where the links between skills, learning, engagement,

Organisational change to improve collaboration.


The centre will promote workforce excellence through:
Engaging with workers in the food and beverage
sector
Utilising existing worker representatives

participation and productivity are understood and


promoted.
The Workforce Centre of Excellence has potential to
complement the work of STAG and assist in implementing
the Skills Action Plan.

INTRODUCTION

Background
Food and beverage is one of the sectors identified under

the sector. The Agenda would include bold targets and

the Growth and Innovation Framework (GIF) as being key

secure stakeholders ownership and commitment to

to New Zealand moving up the GDP per capita ranking of

implementing it. The ideal outcome of the taskforce would

OECD member countries. The food and beverage sector is

be that the resources of industry, government, science

pivotal to the economys growth and export trade. There

and education are focused in partnership to deliver

is already a high level of interaction occurring between

faster, smarter, and more sustainable growth in the food

government agencies and the sector.

and beverage sector.

In 2004, Cabinet agreed that a Food and Beverage

The Skills Working Group is one of three working groups

Taskforce be established with supporting working groups

that report to the Food and Beverage Taskforce. The

to create a three to five year Development Agenda for

working groups outcomes and work programme priorities


are outlined below:

OUTCOMES SOUGHT
Current and prospective employees view the sector as a career destination of choice.
Employers are able to attract sufficient numbers of suitably skilled and motivated employees to meet labour
supply needs of an expanding and diversifying sector.
Employers and employees are able to innovate in the sector and achieve high performing labour and skills
sytems.

WORK PROGRAMME
Priority 1: Better Labour Market Information
Forcasting framework, productivity study, science and technology adoption research and skill shortage
assessments.
Priority 2: More Strategic Investment in Training
Skills and training (workplace practices, community awareness, changing occupations, quality and relevance).
Priority 3: Attractive Careers
High quality workplaces and careers opportunities
Integration of PhD students into food and beverage companies

10

Related Work Underway

The Skills Working Group is co-chaired by the Group


Manager, Labour Market Knowledge and Engagement of
the Department of Labour, and The Secretary of the

A considerable amount of skills, training and labour market

New Zealand Council of Trade Unions.

related work has already been undertaken, that is relevant


to the food and beverage sector. The Skills Working Group

This Skills Working Group report can be found on the

acknowledges and supports this work.

Department of Labour and New Zealand Trade and


Enterprise websites. A separate background document

Food and Beverage Specific Work Underway

will also be available at these locations that contains a


selection of papers that were used to inform this report.

Some examples of food and beverage specific work


include:

Scope

The Human Capability and Agriculture and Horticulture


Group developing a schools curriculum strategy

The food and beverage sector is commonly defined as

with goals to increase the profile of the sector,

all parts of the value chain from on-farm (paddock) to

change schools perception of the sector, increase

customer (plate). However, most of the effort for this

the number of people seeking careers in the sector

engagement has concentrated on primary production and

(eg. more science students) and introduce resources

manufacturing/processing components of the value chain.

across the curriculum.

This has meant a focus on certain food and beverage subsectors as defined in Appendix 1: Australia and New Zealand

Department of Labour sector engagements


(particularly Tourism and Horticulture and Viticulture)

Standard Industrial Classification.

- refer to Transferring Learnings across the Primary

Primary
Producer

Food and
Beverage
Manufacturing

Food and
Beverage
Wholesalling

Food and
Beverage
Retailer

Consumer/
Customer
Food Service
import

export

World Market

11

Sector section of this report, where an example of

Other Work Underway

sector learnings has been outlined in relation to the


Horticulture and Viticulture Seasonal Labour Strategy.

Skills, training and labour market work already underway


(or completed) and relevant to food and beverage

Skill Needs and Worker Voice in High Performance

businesses, includes:

Workplaces this will look at the skills needed in New


Zealands high-tech dairy manufacturing industry;

Tertiary reforms.

identify skills dairy manufacturing workers need, and

Upskilling the Workforce there may be flow-on

what determines whether they learn those skills or


not. Fonterra, the New Zealand Dairy Workers Union,
and the New Zealand Industry Training Organisation
(which covers the dairy industry), will participate in
this study.
Specific ITO related initiatives such as Farmsafe
(ie. training and extension services to farmers),

effects of foundation skills initiatives for food and


beverage employees that need foundation skills .
Adult Literacy and Life Skill Survey an OECD survey
that New Zealand is participating in that will measure
numeracy and problem solving skills1.
Workplace Productivity Agenda involving

where the Agriculture Industry Training Organisation

implementation across the areas of: awareness

(AGITO) works collaboratively with Agriculture New

raising; development of diagnostic tools;

Zealand and Telford Rural Polytechnic to develop an

implementation and research; and evaluation. In

effective programme to change behaviour on the

addition the Department of Labour, Ministry of

farm regarding workplace safety.

Economic Development and Ministry of Research

Competitive Manufacturing (CMI) a consortia of


organisations are supporting the development of
changes in the workplace to increase productivity.
It includes a NQF qualification already available at
level 2-4 and the development of a Diploma for 2007.
Dairy InSights campaign to attract new entrants to
the dairy industry.
The Department of Labours Foundation Skills in

Science and Technology are leading work around


each of the seven drivers of workplace productivity,
as defined in the Workplace Productivity Agenda,
to improve productivity of small to medium sized
enterprises, including those in the food and beverage
sector.
Helping Advance Nga Mahi in Growth and Innovation
(H.A.N.G.I Project). The New Zealand Council of
Trade Unions in conjunction with Hui Taumata has

Seasonal Workplaces this includes a foundation

established the project to focus on workplace

skills and task needs analysis (in the horticulture

productivity education and training for Maori workers.

and viticulture seasonal industries), with a view to

The vision is to increase the number of Ng Kaimahi

understanding foundation skills needs, the type

Maori who engage in workplace learning with the

of foundation learning programmes that could be

support of the unions, enterprises, industry and iwi.

potentially implemented, and the perceived benefits


and opportunities that these programmes offer for
improving workforce productivity.

New Zealand Council of Trade Unions initiatives in


learning, productivity, improving wages and conditions
and Maori economic development.

1. Foundation skills are defined as including reading, writing, numeracy,


Information Communication Technology, problem solving, oral communications
and interpersonal skills.

12

Transferring Learnings across the Primary Sector


The development and implementation of the Horticulture and Viticulture Seasonal Labour Strategy provides some
learnings that are relevant to the food and beverage sector and the Skills Action Plan, as illustrated in the example below.

Horticulture and Viticulture Seasonal Labour Strategy


The strategy has five objectives for implementation which correspond with the priorities identified by the food and
beverage Skills Working Group:
Objectives addressing labour supply

Objective 1: Providing seasonal work opportunities for New Zealanders

Objective 2: Accessing global labour

Objective 3: Information for Informed Management of Seasonal Labour

Objectives addressing the management of labour


Objective 4: Developing skilled workers

Objective 5: Improving workplace quality and productivity

In implementing the strategy, the governance group of industry and agencies has amalgamated objective four
and five so that there are four sub-groups.
Objective three is critical for the strategy. Horticulture New Zealand, Ministry of Agriculture and Forestry (MAF),
Department of Labour and the Ministry of Social Development (MSD) are working on a forecasting tool that was
initially developed by BERL last year. The tool uses labour ratios and production data to estimate demand, but there
is very little helpful data available on supply.
This is particularly difficult in this sector because of the large number of illegal workers, and the seasonality of
the work which means census data may not be fully representative. Sub-group three has a project to adjust the
ratios used and check the production data region by region with industry. It will develop a means of estimating
labour supply sources and numbers. The latter will require creative research techniques and the active cooperation
of industry. Without sound numbers, the MSD and the Department of Labour have difficulty in recommending
immigration or Work and Income responses, and the governance group will not be able to influence the allocation of
education and training resource.
Developing a productive and skilled workforce is the solution needed for the annual crisis in grapes, apples and
kiwifruit industries. The fewer the numbers needed to work, the greater the chance that they can be effectively
allocated, paid well and have better career prospects. Moving to a situation with fewer more productive, and better
paid workers (current turnover approx. 300% a season) will assist in improving grower returns.

13

This requires a national means of easing allocation problems; hence the development of a harvest trail under
the strategy, and the establishment of a national system of seasonal coordinators. This has already assisted in
attracting workers to the areas of need. Training schemes are being developed in Bay of Plenty for managers,
picking staff in Hawkes Bay and for contractor employers in Marlborough.
Sub-group four is coordinating and encouraging these developments. Conversations with regional offices of the
TEC and polytechnics are beginning. First steps are also being directed at basic compliance issues. The work takes
time, and requires national and regional effort.
The systems to manage this work need further development. This includes generating a response from government
and industry, but at a regional and national level the resources and relationships needed to bring about change are
yet to be generated.

14

FOOD AND BEVERAGE EMPLOYMENT

Background
Recent New Zealand economic growth (across all sectors)
has been driven by rising employment, with 260,000 more
people entering the workforce over the past five years.
While the numbers of people entering the workforce have
increased, labour force growth has been in decline. This
means that industries are now struggling to recruit skilled
staff and the international market for adequately qualified
staff and skilled staff is increasingly competitive.
New Zealand currently has the highest skill shortages
in more than 30 years. Some of these shortages are
apparent within the food and beverage sector (eg. chefs,
bakers and food technologists).
Over the next 15 years, key factors that will impact the
food and beverage sector, (and other sectors of the
economy) include:
Movement of significant population cohorts (baby
blip and baby boomers) into, through and out of the
workforce.
Continuing globalisation, both the movement of work
and workers internationally.
Changing skill requirements and the need to address
the educational underachievement of many New
Zealanders (particularly Maori and Pacific Islands
people).
The evolving nature of work, including a greater variety
of employment arrangements, management styles and
workplace cultures and a more diverse workforce.
The accelerating pace of technological change
and innovation and the impact this will have on the
structure of industries and occupations.
Changing aspirations, including relative value placed
on work, family, and community commitments.

15

Consumers demanding healthy and in some cases


more sophisticated products, which requires an
appropriately skilled workforce to deliver such
products.
The food and beverage sector needs to start now to
research, design and implement initiatives that will be
needed to ensure that New Zealand is well placed to
capitalise on labour market opportunities now and in
the future.

A HIGH-PERFORMING LABOUR MARKET

CURRENT LABOUR MARKET AND


EMPLOYMENT OUTCOMES

action by businesses
and individuals

high participation for some skill shortages


low productivity
variable sector and regional performance

high participation for all who seek it


globally-skilled workforce

major change projects

high productivity
aligning activities and
programmes

high-performing sectors and regions

Figure 1: Transformation Theme. Source: Better Work, Working Better, Department of Labour.

TRANSFORMATION THEME

The food service sector is the single largest employer


in the food industry, followed closely by the food and

In order for the food and beverage sector to grow and

beverage manufacturing and food retail sectors.

transform (towards a high skill, high wage, high value

Of the approximately 337,020 people employed in food

economy), a major shift will need to occur in several parts

and beverage, approximately 25% are involved in primary

of the labour market (ie. increased productivity, including

production, 20% in processing and manufacturing, 30%

capacity to innovate through science and technology,

in wholesaling and retailing and 25% in the food service.

reduced skill shortages and increased participation


for those seeking to join the labour force but who are
currently under-represented), as indicated in figure 1.
The combination of these factors will change the way we

Food and Beverage Employment by Sub-sector:

manage and organise work in the future.


A transformation will only be achieved through the efforts
of industry and business organisations, unions and other
organisations such as education and training providers.
Government has a role in supporting and facilitating
change at the individual business, regional, sector and
national levels.

Key Facts about the Food and


Beverage Sector
The food and beverage sector is a major contributor to
the New Zealand economy. In terms of export earnings,
the sector recorded $15.4 billion in 2004 compared to $9.3
billion in 1994, representing an annual compound growth
rate of 5.2% during this period.
In 2005, approximately, one in ten people worked in the
sector and it employed 20% of the working population.

16

The food and beverage share of New Zealand employment:

Source: Statistics New Zealand Population Estimates March 31 2005. Statistics New
Zealand Business Demographics February 2005 (wage and salary earners only).

Some key statistics relating to the food and beverage workforce


are outlined below:
Wages appear to be relatively low in the primary food sector.
MEDIAN HOURLY EARNINGS BY INDUSTRY, 2004

Source: Household Labour Force Survey Income Supplement June Quarter 2004 (wage and salary earners only).

17

A large portion of food and beverage employees have


no or low qualifications (especially in food processing

some occupations may not require a high


level qualification.

and fishing). This should be balanced with the fact that

QUALIFICATIONS OF FOOD PRODUCTION OCCUPATIONAL GROUPS

Source: Statistics New Zealand Census 2001.

18

Large number of health and safety issues (especially in


meat processing and livestock farming). Over the past
two years health and safety costs have been declining.

FOOD AND BEVERAGE ENTITLEMENT CLAIM NUMBERS

Source: Accident Compensation Corporation

19

Long hours in some parts of farming (ie. Dairy Farmer,


Worker and Sheep Farmer, Worker) and fishing

(ie. Fishing Skipper and Fisherperson), compared


with hours for other parts of food and beverage.

PERCENTAGE OF SELECT FOOD OCCUPATIONS WORKING 50 OR MORE HOURS PER WEEK, MARCH 2001

Source: Statistics New Zealand Census 2001.

20

An aging population in most food and beverage sub

Food and beverage consumers are now better

sectors with approximately 45% of those in farming

educated about the benefits of healthy food, impacting

and fruit and crop growing aged 45 years or older in

on the types of skills needed in the food and beverage

2001. This compares with 35% of the total workforce.

workforce.

Employment locations in the food and beverage sector


in 2003 are more evenly dispersed relative to the
manufacturing industry and the economy. The food and
beverage sector has less concentration in the three
main centres of New Zealand. Only 45.1% of FTEs work
in one of the three main centres compared to 58.9%
for the manufacturing industry and 60.7% for the
economy as a whole. Food and beverage FTEs are also
much higher in Otago and Southland than either the
manufacturing industry or the economy as a whole2.
Anecdotal evidence suggests that:
On average total jobs filled in food and beverage are
significantly seasonal in nature compared with non food
and beverage jobs.
Food and beverage worker turnover rate is higher than
for non food and beverage industries.
There is significant dependence on immigrants with

maximise productivity gains by adopting new technology


(capital investment) and to complement this with
improvements in labour productivity and multi-factor

short term work permits especially in the seasonal

productivity (ie. the amount of output produced in

businesses (eg. fruit picking).

relation to inputs of both capital and labour).

Growing need for top talent that can add value to

There is a general perception that food and beverage

existing product ranges and technology advances and

careers are not attractive, therefore effecting

fulfil challenging new roles most of which are related

recruitment and retention and creating skills shortages

to food health, science, technology and research.

in some key occupations.

2. Food and Beverage Sector Taskforce (2005) Discussion Paper on New Zealands Food
and Beverage Sector, Wellington, New Zealand, <http://www.nzte.govt.nz/common/
files/fbtaskforce-discussion.pdf>.

21

Increasing need for employers and employees to

SKILLS WORKING GROUP PRIORITIES

The following sections outline key labour market issues

Background

under each of the three Skills Working Group priorities


- better labour market information, more strategic

A forecasting framework for the food and beverage sector

investment in training and attractive careers.

was considered necessary to process relevant and available


labour market information using appropriate modelling of

1. Better Labour Market Information


The purpose of this priority is to ensure robust data and
information is available to enable sound decision making
about food and beverage skills, training, employment and

future labour and skills demand in the sector. A forecasting


framework has been developed by BERL (Business and
Economic Research Ltd) and tested on the dairy and wine
sub-sectors, which included industry consultation. This
framework is designed to be used by industry organisations

productivity issues. This priority includes improving the

to assist in their workforce planning.

information base by:

The numbers generated for the dairy and wine sub-sectors

Being able to forecast labour demand in sub sectors

are not forecasts, rather they provide an outlook for the

within food and beverage.


Better understanding of the link between productivity
and skills in food and beverage businesses.
Better understanding of how to increase the adoption
of science and technology in food and beverage
businesses.
Determining the extent of current skills shortages in
key food and beverage occupations.
Each of these components is explained in detail below.

sub-sectors and are the result of specified scenarios


which demonstrate how the framework can function.
The framework is a starting point requiring further work,
industry ownership, data integrity and interpretation of
facts and trends that are identified as a result of running
the numbers. The interpretation is necessary within a
strategic context that includes the impacts of soft
influencing factors on the flows of labour.
This framework will enable the food and beverage sector,
education and training organisations, industry associations
and government agencies to make better assessments
about future labour and skill needs in this sector and how

1.1 FORECASTING FRAMEWORK

to address them. It may assist in education, training and


recruitment decisions and assist the taskforce in planning

Action Points

its development agenda. There is a distinct need for


projections of the trends in the demand for labour over the

The food and beverage forecasting framework will


be implemented and applied to all food and beverage

medium term in relation to future growth or changes in the


food and beverage sector.

sub-sectors and maintained on an ongoing basis.


This would involve food and beverage ITOs (as part of

The framework needs to be further tested with respect

their strategic skills leadership role) assisting in the

to the assumptions (labour turnover, productivity, output

implementation of the framework in conjunction with

growth, extent of part-time work) used and integrity of the

other relevant organisations.

data. It could then be extended to other food and beverage


sub-sectors. It will be critical to improve the information

STAG will guide consistency of application of this

used in the framework and data updates, including use

framework within the food and beverage sector,

of the 2006 Census information on occupations and

improve the framework, and test its robustness

qualifications within the food and beverage sector. In

with respective industry organisations and training

implementing this framework, future population changes

organisations.

22

Inputs

Outputs

Types of Decisions

Recruitment

Immigration

Tertiary education

Benchmark historical
data (Census,

(ie. Labour

Business Directory,

requirements by

ITO data)

occupation and

Exogenous
production volume
forecasts (wine &

Forecasting
Framework
Application

dairy industry)

Default scenario

qualifications)

and training

Alternate scenario 1

Wages

Alternate scenario 2

Career promotion

Capital investment

Parameters (eg.
value added in the

and use of

production chain,

technology

labour turnover,
labour productivity,
fulltime/part time)

Stakeholder
interviews

(fertility and migration) and workforce changes (ie. greater

derived demand for labour as a result of output changes.

participation of women and older workers) will be taken into

The share of occupations in each value chain and the

consideration.

qualifications of those employed are based on the 2001

The forecasting framework developed for the food and


beverage sector has suggested an approach which utilises
available forecasts (of product output) and existing data
and parameters to derive future employment levels at
some level of detail. In that process, the need for more
up-to-date and consistent data has also been identified to
make the results (eg. occupations and qualifications) more
relevant.
The key components of the forecasting framework are
outlined above.

census results and have been maintained at this level over


the forecast period (2006-10). These can be updated when
the 2006 census results on occupations and qualifications
shares in food and beverage sub-sectors and value chains
are made available by Statistics New Zealand (SNZ).

APPLICATION OF THE FORECASTING


FRAMEWORK
Overview of Results
Comparisons of recent (2000-05) changes in employee
counts and full-time equivalent employment in the food

The inclusion of labour turnover allows for an assessment

and beverage sector, in comparison to the overall labour

of replacement demand of the existing workers in each

market are summarised below:

value-chain to be estimated along with the additional

23

Over the five year period (2000-05), excluding


agriculture, the employee count in food and beverage
has grown by 23% compared to 17% for the whole of
New Zealand over the same period.
Over the last ten years (1995-2005), total food and
beverage employment by full-time equivalents (FTEs)
increased by 8% (including all agriculture) compared to
total New Zealand FTEs which increased by 22% (SNZ
and BERL calculations);
The food and beverage value chains with the
highest employee count in 2005 were food service,
manufacturing and retailing, with lower number of
employees in marine fishing, horticulture and food
wholesaling.
Between 1995 and 2005, the share of FTEs in
agricultural production activities declined from 40%
to 33% of total food and beverage employment. The

food service share increased from 16% in 1995 to over


20% in 2005 while the manufacturing share remained
relatively unchanged at about 20% and the retailing
activity share at about 15% over the 1995 to 2005
period. The wholesaling share rose very slightly from
6% to 8%.
An example of how the framework can be applied in the
form of the value chain is outlined below:
The Food Industry Model developed in the Coriolis report
shows that the food industry begins with natural resources
and ends with sales to domestic consumers or to export
markets.
The applicability of employment data depends on how
well the data can be applied to the value chains of the
various sub-sectors. As a test BERL have incorporated
employee count data into the Coriolis Food Industry
Model (see below).

CORIOLIS FOOD INDUSTRY MODEL WITH EMPLOYEE COUNT

RESOURCES

Pasture

Farm
equipment,
supplies,
genetics,
etc

Arable land and


horticulture

Livestock

30,580

Milk

20,310

Grains

490

50,890

Primary

MANUFACTURING & WHOLESALE


Meat processing

30,440

Meat wholesaling

1,920

Dairy processing

9,650

Dairy wholesaling

1,250

RETAIL &
FOOD SERVICE

Grain-based manufacturing 8,870


Grain-based wholesaling

350

Fruit & vegetable processing 5,600


Fruit & vegetable wholesaling 3,410

26,340
Fruit & vege

Seafood

Support
functions

PRODUCTION

2,190

Fish & other


seafood
Food imports

25,850

2,190

Beverage manufacturing

6,010

Beverage wholesaling

2,740

Seafood processing

5,980

Seafood wholesaling

560

Other food processing

7,410

Other food wholesaling

15,110

158,270

Education, Recruiting & Human Resources; Logistics and Distribution; Market Research, Advertising and Design,
Research and Development, Information Systems; Packaging; Finance, Banking and Insurance.

Source: Model adapted from Coriolis, Employment Data from Statistics New Zealand

24

Examples of Sub-sector Outlook for Dairy and Wine

Employment: Sub-Sector Totals and by Value-Chain

The comparisons include outlook results (2005-10) of

Total employment in the dairy sub-sector rose by fewer

overall employment in the dairy and wine sub-sectors under

than 5,000 FTEs (or by 9%) between 2001 and 2005 and

the default scenario in relation to recent developments

this is forecast to grow by about 3,750 FTEs (or by 7%)

(2001-05) in these sub-sectors. This is followed by

over the 2005 to 2010 period. Wine sub-sector total

observations on the occupations and qualifications share

employment grew by about 3,500 FTEs (or 28%) over

of employment in each of the value chain3 activities for

the recent period (2001-05) but is forecast to grow

dairy and wine sub-sectors based on the 2001 Census.

only by about 2,100 (or by 14%) over the forecast period

The overall employment results, are also provided, taking

(2005-10).

into account replacement demand (under the default


and an alternate lower turnover scenario), the impact of
higher output (ie. milk solids and wine grapes) and lower
productivity scenarios on dairy and wine sub-sector
employment.

During (2001-05), the greatest increase in dairy


sub-sector employment was in the processing/
manufacturing (22%) and the retail service (15%) value
chain activities. Over the forecast period (2005-10),
the increase in processing/manufacturing employment
is expected to rise by only 9% while retail and retail
service employment is expected to rise by about 15%.
During (2001-05), the greatest increase in wine subsector employment was in production (about 50%),
followed by wine making (18%) and wholesaling (24%)
value chain activities. Over the forecast period (200510), the increase in employment in production activities
was considerably less (under 10%) and the rise in
employment in all other value chain activities was in
the range of 12-18%.
In the dairy sub-sector, activities at the paddock or
farm level account for over 60% of the employment
followed by processing (18%) and retail and retail
services (7-8%). In the wine sub-sector, activities at
the vineyard level account for only about 30% of the
employment closely followed by retail (29%), retail
services (24%) and processing (15%).

3. BERL have used the following components of the value chain; paddock, process, wholesale,
retail and retail service.

25

Occupations by Value-Chain Activities


In terms of occupations by value chain activities, dairy
farmer/farm worker and grape grower/wine maker
accounted for over 60% of the production related
occupations. In the case of processing activities, about
50% of the occupations in the dairy sector were in the
other category and hence specific occupations were
undifferentiated. This other category accounted for
just under 30% in the case of wine processing.

About 20% of the dairy sub-sector workers and 15%


of the wine sub-sector workers possessed either basic
vocational or advanced vocational qualifications while
about 6% of the dairy and 9% of the wine sub-sector
workers had a bachelors or higher degree according to
the 2001 Census.

1.2 Productivity
Action Points

In the wholesale value chain, administration and


management related occupations accounted for about

Complete the productivity study currently underway,

20% in dairy and were over 30% in wine wholesaling.

which will identify productivity issues specific to food

Technicians and associate professionals made up about

processing businesses.

15% of the occupations in dairy and 17% in wine, while


service and sales workers in wholesaling accounted
for about 11% in dairy and 14% in wine. Professional
occupations in dairy had a 14% share, however the
number of professionals was not separately identified
in the case of the wine industry.
In the retail and retail service value chain, service and
sales staff accounted for about 40% and 60% of the
occupations, respectively in the case of dairy and wine.
Administrative and managerial positions represented
about 15% and 20% of the occupations in retail and

The New Zealand Council of Trade Unions will use


the findings of the productivity study to inform the
Workplace Productivity Education Programme and in
developing resources for union delegates and future
productivity initiatives.
A first phase of science and technology adoption
research has been completed. The findings will be
taken forward with industry and relevant agencies.

Background

retail services, respectively, in the case of both dairy

Although all sectors of the New Zealand economy have

and wine sub-sectors.

been enjoying an increased level of productivity growth

Qualifications breakdown for sub-sectors


Based on the 2001 Census, over 28% of the dairy
sub-sector and about 22% of the wine sub-sector
workers had no qualifications while over 40% of the
dairy sub-sector and almost 50% of the wine subsector workers had high school qualifications. However,
qualifications are not always necessary for some

in recent years, the countrys productivity measured in


absolute terms still lags behind the OECD average.
The graph (next page) illustrates the differences in labour
productivity between OECD countries based on GDP
per hour worked across all sectors of the economy.
It illustrates that New Zealand is also below the OECD
average for labour productivity.

occupations.

26

AVERAGE ANNUAL GROWTH IN PERCENTAGE, 2002-2004 OR LATEST PERIOD AVAILABLE

Source: Organisation for Economic Cooperation and Development (2005). International Comparisons of
labour productivity levels estimates for 2004, September 2005, OECD estimates. Paris, France.

Over the past decade, New Zealands economic growth has

The Treasury provided an analysis that examined

been driven by a significant increase in hours worked and

productivity performance of the primary, and food,

the volume of human capital in work. David Skilling from the

beverage and tobacco and manufacturing (FBTM)

New Zealand Institute outlines the downside of the picture:

industries. It indicated that output and labour productivity

..Labour force growth accounted for about two thirds


of New Zealands growth over the past fifteen years,
with labour productivity accounting for just one third.
Labour productivity over this period grew at just 1.0%
a year, which is in the bottom quartile of performance
across the OECD.

..New Zealands labour productivity, in terms of output


per hour worked, is just 79% of the OECD average. New
Zealands hour worked per capita on the other hand
stands at 113% of the OECD average.4

4. The New Zealand Economy: The Next 20 Years. 4 March 2006.

27

growth in the primary and FBTM industries has been


strong, as illustrated over the page (total manufacturing
is included for comparison). Some of this growth could be
attributable to factors such as increased intensity of food
and beverage production practices.

LABOUR PRODUCTIVITY

Source: A Treasury presentation to the Skills Working Group in March 2006

New Zealand now has more people working but for longer
hours than most other OECD countries - 21% of New
Zealanders work 50 or more hours per week, second to

Creating productive workplace cultures, and


Measuring what matters.

Japan at 28%. Working smarter, investing in capital and

Business and employer groups, unions and government

moving higher up the value chain is a more sustainable way

are working together to help lift workplace productivity

of increasing GDP than increasing hours of work.

in New Zealand through implementation of the Workplace

In order to improve productivity, the Workplace Productivity


Working Group identified seven drivers in 2004 (listed
below) that can assist with improving productivity, each of
which is explained in more detail online:
http://www.dol.govt.nz/workplaceproductivity/
Building better leadership and management

Productivity Agenda. To assist in this process (from a


food and beverage point of view) a productivity study has
been commissioned (part a below) and research has been
commissioned into science and technology adoption in the
food and beverage sector (part b).
A. PRODUCTIVITY STUDY
The study on productivity in the food and beverage sector

Organising work

is intended to:

Networking and collaborating

Assess the current state of productivity specific

Investing in people and their skills


Encouraging innovation and using technology

to food processing businesses (ie. confectionery and


snack food sector) within the food and beverage
sector utilising the framework provided by the

28

Workplace Productivity Working Group (ie. the seven

Issues that impact on the confectionery and snack

drivers of workplace productivity). This industry has

food sectors ability to be productive include:

characteristics that will enable the research findings


to be generalised across manufacturing/processing
parts of the food and beverage sector.
Provide suggestions on how productivity in the sector
could be improved and how government, training
organisations and sector groups can better assist
workplaces to improve their productivity.
Identify what workplace practices are working well and
conversely not so well in the confectionery and snack
food sector.
Identify impediments to lifting productivity
performance of businesses in the confectionery and
snack food sector.
Provide methodological insight to inform future
research.
Early observations from the Deloitte team undertaking the
study, indicate that investment in production technology
has a discernable correlation with:

The need for more effective deployment of support


mechanisms for New Zealand owned organisations to
achieve increased productivity through export growth.
Market drive to invest in machinery, technology and
innovation, leading to training for higher level skill needs
and ultimately to higher productivity performance.
A shift from applying the seven drivers of productivity
to reduce costs per unit of production, to applying the
seven drivers to create an environment that supports
successful research and innovation, therefore calling
on a more significant investment in skills.
The need to focus on developing specific technological
expertise that could advance the confectionery and
snack food sector.
The need to develop catalysts and sustained support
to improve networking and collaboration in the sector.
Access to affordable capital.

The requirement for upskilling and commensurate


investment in people and human resource programmes.
The organisations ability to compete in more than

The Skills Working Group, in collaboration with the

just national niche markets and therefore to achieve

Innovation Working Group, identified the need to conduct

real production and productivity growth.

a research study to better understand constraints to

Investment in infrastructure and technology often


prompts investment in upskilling. Alternatively, it is also
known that investments in upskilling can drive increased
investments in technology to complement a new skill set.

science and technology adoption (focusing on the attitudes,


skills and behaviours of owners, managers and staff). The
study investigated how more active interactions across
the supply and value chains could be encouraged to
increase adoptive capacity: Why it is that some companies

Within the confectionery and snack food sector there

adopt science and technology innovations and others, who

is a proven ability to innovate with some very successful

know about their potential benefits, choose not to?

high value niche products being developed by both large


and small organisations. This sub sector has a strong
entrepreneurial spirit and a flexible workforce able to
be deployed in a manner that supports highly productive
organisations.

29

B. SCIENCE AND TECHNOLOGY ADOPTION

The vegetable and savoury foods sub-sector was selected


for this research because of this sub-sectors potential
for sustainable growth (i.e. the convergence between
market demand for healthier, stylish and convenient foods

and science and technologys ability to provide solutions

debt/equity to fund improvements, which biases

palatable to a wide range of consumers).

investment towards incrementalism rather than

Increasing demand for vegetable-based foods that


combine health, style and convenience can best be
met by growers and processors developing skills and
networks to make use of science, technology, marketing
and organisational innovations. These innovations are in
relation to growing produce; environmental management;
understanding emerging market demand; adding value
in processing, storage and packaging; and enabling more
efficient distribution to maintain freshness, goodness,

disruptive innovations. The third is the impact of the


characteristics of the owner or manager the higher
their levels of confidence and vision to take risks, and
analytical skills and education, the more likely it is they
will adopt science and technology.
Secondary drivers include the:
Speed with which investment decisions can be made.
Style and structure of management.

flavour and appearance.


Level of in-house scientific and technical expertise;
A two-phase approach to the research has been adopted.

where high transaction costs with sourcing seasonal

Phase one has been completed with findings outlined below.

staff lead to technology substitution for labour.

The first phase aimed to help stakeholders understand

Difficulties to do with the availability and suitability

and be able to take action to improve adoption rates.

of labour where it has been a factor in decisions

In the first instance it is exploring the range of attitudes,

to increase levels of automation so as to reduce

behaviours, skills, relationships, and networks that decision

reliance on labour. This is in part to do with the

makers and ground floor staff need in order to assess:

seasonal nature of the industry, especially in growing

The potential of an innovation.


The nature of the change process that would be
involved in adopting it.
The requirements for successful implementation.
It also sought to understand the impact that the presence
or absence of highly qualified staff or PhD students has on
assessment, change management and implementation. The
research looked at the impact of organisational culture

where there is no guarantee that next years labour


pool will be the same as last years, leading to
significant transaction costs.
At the commodity growing and processing end of
the vegetable industry value chain, there are well
established systems, processes and networks
supporting the adoption of technology for survival
(for now).
Few companies are targeting niche local and export

and organisational practices on openness to adoption, and

markets with high quality and differentiated products,

adoption rates.

where science and technology adoption (innovation)

Key findings from phase one are:


There appear to be three primary drivers as to

are critical success factors, and the real returns lie.


This appears to relate to there being no apparent
modus operandi or development pathway available for

how open or otherwise businesses are to adopting

new products and for creating the value chain needed

science and technology. The most significant is the

to get them to market successfully. Furthermore,

focus on survival, either through increasing efficiency

large scale science and technology adoption, to drive

or matching competitors products. The second is

economic transformation, requires the industry as

that lack of scale means using cash flow rather than

a whole to develop the willingness and capability to

30

Promoting good practice within Crown Research


Institutes as to how scientists and business work
together to solve real problems within particular
business contexts.
Phase two will involve progressing these findings from
phase one with relevant industry and government agencies.

1.3 Skill Shortages


Action Points
Information has been gathered for the Skills Working
Group on genuine skill shortages and recruitment
and retention difficulties for bakers, butchers, chefs,
dairy farmers and dairy farm workers, and food
technologists. Appendix two outlines ways to address
these issues. The Skills Working Group will consider how
best to promote these solutions.
collaborate to create a New Zealand Incorporatedscale new value stream.

Efforts will continue to improve the quality of labour


market information about skill shortages in the

There are however, opportunities to improve the system

food and beverage sector to better inform tertiary

to better facilitate science and technology adoption.

education and training strategies and priorities.

A number of suggested improvements for both industry


and government to consider are:

Background

Improving availability and accessibility (perhaps through

Skill shortages can indicate a healthy, dynamic economy

pooling) to key technical skills (eg. engineering process

creating new jobs and expanding existing jobs at a fast

design, food technology).

pace. However, shortages may also be imposing a cost on

Creating a service for the collection and dissemination


of pragmatic and up-to-date free market intelligence
in the vegetable and savoury food sub-sector to be
accessed through a single portal.
Provision of brokerage skills to connect generators
and users of technology and science.
Actively identifying and developing opportunities to

the economy, by constraining the outputs of a business.


The education and training system is crucial to raise skill
levels and adjust the skills required to match the current
and future workforce. To attract and retain a highly skilled
workforce, businesses need to offer appropriate wages
and fund appropriate levels of training, introduce worklife /flexible work practices and address recruitment and
retention difficulties.

achieve higher levels of collaboration, especially in

It is important that tertiary education and training

export markets.

investment and strategic decisions factor in the need to


address skill shortages in the food and beverage sector.

31

There are different types of skill shortages5 and the

production manager, sales/marketing manager, fitter and

causes are varied, as are possible solutions relevant to

turner and electrician) and some are specific to food and

each sub sector within the wider food and beverage sector.

beverage (i.e. chef, dairy farmer/farm worker, baker and


butcher). Food technologists are one of several closely

The Skills Working Group selected a few occupations for


which there was either statistical or anecdotal evidence of
current skill shortages likely to have an impact on future
growth of the sector.

related occupations that are subsumed under the broad


occupational grouping Chemical Engineer.
The approach used to analyse these occupations is based

Selected occupations included: baker, butcher, chef, food


technologist, dairy farmer/dairy farm worker, electrician,
fitter and turner, production manager, sales/marketing
manager. Some of these occupations are generic (i.e.

on the Department of Labour framework for analysing


skill shortages in New Zealand. This framework is explained
below and considers demand (or opportunities); supply
(or capacity) and the balance between them.

Industry growth

Changing use of occupations


by industry

DEMAND/OPPORTUNITIES

DEMAND FOR OCCUPATION

Balance between demand and


supply is measured by:

Imbalance = shortage
BALANCE

Fill rate
Advertised vacancy growth
Wage trends

SUPPLY OF OCCUPATION

MIGRATION
Members of the occupation
leave and enter NZ.

Shortage may be a genuine


skill shortage
Or retention/recruitment
difficulty

RETIREMENT
OCCUPATIONAL DETACHMENT
Members of the occupation
leave and re-enter the
occupation.

Members of the occupation


retire.

SUPPLY/CAPACITY

5. There are two types of skill shortage: 1) Genuine skill shortage - when employers have difficulties filling job vacancies because there are not enough individuals with the required skills
in the potential labour market to fill the positions on offer; and 2) Recruitment and retention difficulty - when there is a considerable supply of individuals with the required skills in
the potential labour market, but they are unwilling to take up employment at current levels of remuneration and conditions of employment.

32

A summary table below outlines some key shortage

Production manager6 is probably not suffering from

indicators for each occupation, as well as the skill shortage

skill shortages, although this does not preclude

assessment for each occupation:

shortages existing in specific niche manufacturing

Both genuine skill shortages and recruitment and

industries.

retention difficulties clearly affect the following

There are a variety of ways to address skill shortages

occupations namely: baker, butcher, chef, dairy farmer/

(ie. enticing expatriates back home, immigration, attracting

dairy farm worker, and possibly also impact on food

people from similar/related occupations, substitution with

technologists.

technology and/or up-skilling the existing workforce). Other

Electrician and fitter and turner both suffer from a


genuine skill shortage and sales marketing manager
probably also face such a shortage.

sources include providing incentives for older people to


work for longer (before retiring), incentives for non-working
parents to re-enter the workforce earlier, and incentives
to attract non-traditional workers to occupations (eg.
women to become fitters and turners).
While skill shortages can be addressed through
means identified above, there is a need for integrated
conversations between training providers, unions,
employers and government agencies.
A summary of potential ways to address skill shortages
for each selected occupation is outlined in Appendix 2.
The potential solutions are specific applications of priority
two and three approaches.
The following table 1 summarises the results of the skill
shortage indicators and assessments for each occupation.
Appendix 3 contains an explanation of terms and sources
used in the development of this information.
Table 2 contains demographic and qualification related
information about each selected occupation.

6. It should be noted that there are many terms used for production manager such as
site, plant, logistics or procurement manager, hence it is possible that not all data
relating to production manager has been captured. Also note that anecdotal evidence
suggests most production managers come about through promotion rather than by
acquiring a relevant qualification. This is an example of where industry training levels
may need to be increased above level four.

33

TABLE 1: SKILL SHORTAGE ASSESSMENTS


The following table summarises skill shortage indicators and assessments for each occupation (also refer to Appendix 3
for an explanation of terms used and more detailed statistics and source information).
Occupation

Fill rate

Retirement Vacancy
rate
growth rate

Training
rate

Wage rate

Genuine skill
shortage

Recruitment &
retention difficulty

Production Manager

0.9%

-36%

$39.87

Probably not

Probably not

Sales/Marketing Manager

0.6%

7%

$52.06

Probably

Probably not

Food Technologist

0.9%

37%

$28.56

Possibly

Possibly

Chef

51%

4.1%

0.3%

14%

$15.18

Yes

Yes

Dairy Farmer/
Dairy Farm worker

1.7%

17%

$18.07

Yes

Yes

Electrician

30%

2.6%

1.1%

-10%

$23.89

Yes

No

Fitter & Turner

27%

3.0%

1.5%

3%

$22.86

Yes

No

Butcher

62%

1.9%

1.0%

38%

$16.12

Yes

Yes

Baker

37%

1.2%

0.6%

24%

$17.07

Yes

Yes

TABLE 2: DEMOGRAPHIC AND QUALIFICATION DATA PER SELECTED OCCUPATION


Source: Statistics New Zealand 2001 Census

Male
(%)

Female
(%)

NonPakeha
(%)

Age
(15-29)

Age
(30-49)

Age
(50+)

School
(%)

Post
School
(%)

Degree or
Higher (%)

Production Manager

86

14

13

13

64

23

54

34

13

46

Sales/Marketing Manager

67

33

18

64

17

54

24

22

42

Chemical Engineer

67

33

17

26

55

19

23

25

51

20

Chef

64

36

34

50

43

58

39

24

Dairy Farmer/Dairy Farm Worker

66

34

22

54

25

74

22

64

Electrician

99

10

25

53

22

24

75

22

Fitter & Turner

100

11

20

56

25

41

58

24

Butcher

96

25

34

43

23

70

29

28

Baker

70

30

34

42

45

13

78

20

22

Occupation

>50hrs
per week

34

Based on the above census data, the following information


about each of the selected occupations has been identified:
Bakers and chefs reflect a distinctly different age
distribution of their workforces compared to other
selected occupations. These hospitality occupations
are heavily weighted in the young to middle aged
category and lightly weighted in the old-aged category.
Training, work experience and attitude count for more
than educational qualifications for occupations such
as baker, butcher, chef, dairy farmer/dairy farm worker,
electrician and fitter and turner. Very few of them
possess a degree. Although 51% of chemical engineers
possess a degree, followed by sales/marketing manager
(22%) and production manager (13%).
In terms of hours, dairy farmer/workers work long
hours with 64% working more than 50 hours per week,
followed by production manager (46%) and sales/
marketing manager (42%).
All the occupations except chef are insignificant users
of work permit holders. For chefs, 21.9% of their
workforce have work permits.

35

Eight of the nine occupations are male dominated, with


fitter and turner showing 100% male, followed closely
behind by electrician (99%) and butcher (96%);. The
exception is food technologist where the survey shows
that 63% of the workforce is female.
The ethnic group composition for all nine occupations is
predominately pakeha. However, 34% of both chefs and
34% of bakers are non-pakeha.

2. More Strategic Investment in Training

This priority was designed to identify how skills and training

The Skills Working Group has indicated that in order for

issues could be better addressed.

change to occur in food and beverage skills and training,

A process for tertiary education reform is underway which


will provide solutions to enhance the quality and relevance
of tertiary education provision. While this is a major
initiative over several years, it needs to be complemented
by sectoral work that more closely links education and
training provision with industry needs.

that collaboration of key players (incl. training providers)


is necessary. The STAG will facilitate this collaboration
and oversee implementation of issues identified below.

2.1 Workplace Practices


Action Points

The Department of Labour and the TEC prepared


background material for two workshops. The first workshop
was with Agriculture Industry Training Organisation,
Competenz, Lincoln University, AgResearch, Horticulture
Industry Training Organisation, the TEC, the Department of
Labour and New Zealand Trade and Enterprise. The second
workshop was with the New Zealand Council of Trade
Unions, Business New Zealand, the Department of Labour,
and the New Zealand Beer, Wine and Spirits Council. This

Promote and explore industry best practice and


incentives in relation to skills development.
Increasing employee participation in training, and
support for the Council of Trade Unions Learning
Representatives Scheme.

Background

work was complemented by discussion at the Skills Working

Employers, and employees and their representatives have

Group and the taskforce as well as analysis of the feedback

important roles to play in creating high quality, productive

generated by the taskforces consultation process.

workplaces which support access to appropriate

Background material for the workshops included:


A draft report from the Tertiary Education Commission
called Report to the Skills and Training workshop for
the Food and Beverage Skills Workshop Group .
A draft report from the Department of Labour

opportunities for skill development.


There is an opportunity to invest in knowledge building
about the future ongoing changes in the nature of work
for food and beverage companies, and the impact of
these changes on workplace practices for employers and
employees. The work to date has identified a pressing

called Draft Food and Beverage Skills Working group

need to share best practice within industry and promote

- Discussion Paper.

the value proposition of investing in skills development


for managers and staff.

Common skills and training themes arising from the


workshops (and other sources), were:

2.2 Community Awareness

Workplace practices.
Community awareness.
Responding to changing occupations and skill needs.
Quality and relevance.

Action Points
Develop learning resource materials for curriculum
in primary and secondary schools that reflect the
importance of the food and beverage sector as a major
employer and contributor to New Zealands economy.

36

Promote careers to parents, youth, teachers and

Increase support and encouragement for the uptake

careers advisors that reflects the reality of working

of relevant vocational qualifications (inclusive of higher

in the food and beverage sector (ie. how sophisticated

level qualifications) that provide a good match to

jobs are now).

associated job opportunities.

Support initiatives from the Human Capability Group

Continue and extend active support for alternative

in Horticulture and Agriculture, which involves a

employment (preferably in the food and beverage

schools curriculum strategy with goals to increase

sector) with tailored programmes for individual workers

the profile of the sector, change schools perception

and investment in education and training for employees

of the sector, increase the number of people seeking

affected by business closures, downsizing and

careers in the sector (eg. more science students), and

relocations. This would involve working with employers,

introduce resources across the curriculum. In addition

unions, ITOs, other education providers and agencies of

and alignment with this work, encourage a coordinated

government and local government.

cross sectorial approach to career promotion in


schools.

Background

Background

Due to the introduction of new technology (incl. upgrades),

It is apparent that for education and training to be

innovations and convergence with other sectors (eg. food

taken up, there needs to be greater awareness of the

and health, food and hospitality), traditional occupations

opportunities such occupations offer. This is an area in

and career paths are changing (ie. from low to high value

common with priority three, Attractive Careers. The

work). It is important that education and training reflects

focus of this area in priority two is the way the primary and

these needs, for which employees are able to adapt existing

secondary parts of the education system communicate the

skills and develop new ones. It is also important that

realities of working in the food and beverage sector.

employers provide a flexible work environment. Education

integration of production processes, productivity

and training should not only be provided to those whose

2.3 Responding to Changing


Occupations and Skill Needs
Action Points
Explore ways to improve the ability of the skills and
training system to adapt to rapidly changing and new
occupations.
Increase support for initiatives that could be
undertaken by Learning Representatives and build on
current work with a group of ITOs to integrate literacy
training with industry training (eg. in seafood and
agriculture).
Communication of the relationship between high levels
of foundation skills in food and beverage businesses
and favourable productivity results.
37

jobs are changing but also to those whose jobs have


changed.
As with other industries, the food and beverage sector
has a spectrum of skills that range from top talent to
foundation level. Investment in foundation skills may be
just as important as investment in relevant vocational
qualifications and higher education.
There is usually a strong relationship between a
workforces foundation skills and the level of labour
productivity within a business, thus demonstrating the
need for employers and government to invest in foundation
skills. ITOs are currently piloting the integration of
foundation learning (work in progress) into industry training
and ensuring training and foundation learning is available to
low skilled workers.

While industry training is an appropriate avenue for delivery

The TEC and other government agencies will facilitate

of foundation skills in the workplace, there are issues

greater partnering of delivery between ITOs and TEIs

associated with the capability of the system to support its

to better meet industry needs and enable them to

integration. For example, this requires ITOs to undertake

be more responsive to emerging demand through its

additional/new work to identify specific foundation

profile negotiation process and support for the ITO

needs, assess individuals needs, train existing trainers to

leadership role.

incorporate foundation learning, and assess gains made as


a result.

Review the quality and relevance of the large number


of food and beverage related qualifications with a

High proportions of food and beverage employees have no

view to consolidating them into a smaller number of

or low qualifications, although this needs to be balanced

higher quality courses. In specialist areas, the option

with the fact that some food and beverage occupations

of consolidating into one centre of excellence in New

do not require sophisticated skill bases. Given parts of the

Zealand should be considered (eg. fishing, dairy and

food and beverage value chain are increasingly becoming

meat processing and grape processing).

more sophisticated and consumers are demanding better


quality, there will be pressure on some food and beverage
occupations to deliver to a higher standard. This will
generally require a more developed skill base and capability
within the workforce.
Government will shortly consider proposals for how
employers will be engaged and learners motivated to
take part in the upskilling strategy, including a model
for developing demand and ensuring a balance with
the provision of training in the workplace, and specific
initiatives. It is possible that the proposed upskilling
initiatives could be reflected in the Skills Action Plan for
the food and beverage sector and the work by STAG,
following decisions by Government.

2.4 Quality and Relevance


Action Points
The Skills Working Group recommend that in relation
to the tertiary reform process, that funding must be

Review the relationships amongst polytechnics, ITOs,


industry and unions in setting food and beverage
related qualifications and ensuring quality and relevance
of training.

Background
There is a need for the quality and relevance of education/
training provision at all levels and by all providers to be
better aligned to the needs of industry and reflective of
changing occupations. It is critical that the resourcing
of education and training for people already employed in
New Zealand industries (including the food and beverage
industries) as well as those undertaking full-time or preemployment tertiary education, is allocated in a manner
that is strongly linked to appropriate tertiary education
strategies and priorities (ie. investment in highly relevant
qualifications). There is an opportunity for greater
partnering of TEIs and ITOs to meet changing skill needs,
and for more involvement of ITOs and industry in funding
processes and priority setting.

linked to the new Tertiary Education Strategy and the

The Skills Working Group is concerned at the number of

Statement of Tertiary Education Priorities. This should

food and beverage courses being offered by a myriad of

include a stronger feedback loop between the TEC and

organisations, all of whom are to a greater or lesser extent

industry, and a greater capacity for ITOs to influence

seeking funds from government to support their provision.

funding and priority setting.

This may have led to unnecessary duplication and possibly


lower quality provision. An example of where the quality

38

of provision could be improved can be found in comparing

Institutes of Technology and Polytechnics (ITPs) have

New Zealand with Australia in the provision of education

provided the greater part of food and beverage related

and training in wine making. A number of New Zealand

education and training supported by the Student

organisations offer a range of wine making courses in New

Component Fund. The proportion of all food and beverage

Zealand, compared with the Australian Roseworthy Wine

related provision facilitated by this sub-sector increased

Centre of Excellence. Focusing on quality and not quantity

nearly 10% between 2002 and 2005. Of the total EFTs

and having one centre of excellence is a model New Zealand

funding in 2005, for example, the distribution amongst

could consider adopting in food and beverage sub sector

provider types was as follows:

areas.
There is a need for fund allocation to be:
Targeted in a manner that rewards high performing
education/training provision and best practice.
That provides incentives for centres of excellence in
areas of potential growth in the economy.
Encourages collaboration of various providers to
reduce duplication of provision.

19% University enrolments;


10.5% Private Training Establishment (PTE) enrolments;
and
3.5% each to other tertiary education providers
(OTEPs) and Wananga.
The number of qualifications in which learners have
enrolled has steadily increased in most food and beverage

Tertiary Education Commission Funded


Education and Training Supported by Student
Component Funding

subject areas between 2002 and 2005. During this time,

In the period 20022005, the number of learners enrolled in

subject areas.

food and beverage related qualifications has nearly doubled,


from 22,541 in 2002 to 44,010 in 2005. Similarly, the
government Student Component Fund EFTS subsidy for
the food and beverage sector has increased, from almost
$60 million in 2002 to over $86 million in 2005.
This enrolment growth was driven largely by increases in
enrolments during 2002-2005 in the subject area Pest and
Weed Control and also in Agriculture subject areas. Overall
the figures suggest enrolments in food and beverage
related provision across this period shifted towards
introductory-level qualifications (NQF qualification levels
13), and part-time study.

Note: 30 detail subject categories from the New Zealand Standard Classification
of Educational Qualifications (NZSCED) were included in the TEC analysis of food and
beverage sector-related tertiary education and training.

39

63.5% ITP enrolments;

the number of qualifications at least doubled in Animal


Husbandry, Food Hygiene, General Land Skills, Hospitality
Management, Pest and Weed Control and in Agriculture

Three food and beverage subject areas consistently had


the highest number of different qualifications in which
learners were enrolled. For example in 2005, there were 71
in Cookery, 67 qualifications in Horticulture, and 45 in Food
and Beverage Service.

Tertiary Education Commission


Funded Education and Training
Supported by Industry Training
Funding
Of the approximately 40 ITOs that have been in operation
since 2002, eight are important in facilitating industryspecific tertiary education and training relevant to the
food and beverage sector. These are:
Agriculture Industry Training Organisation Incorporated
(Agriculture ITO);
Hospitality Standards Institute (HSI);
InfraTrain New Zealand Limited (InfraTrain New Zealand);

New Zealand Horticulture Industry Training


Organisation Incorporated (Horticulture ITO);
New Zealand Industry Training Organisation
Incorporated (NZITO);
New Zealand Seafood Industry Council Limited (SITO);
and
NZ Retail Meat Industry Training Organisation
Incorporated (Retail Meat ITO).
Overall, the number of trainees engaged in ITO-led food
and beverage training more than doubled (114% growth),
from just over 28,000 in 2002 to just over 60,000 in 2005.
This compares with the slower overall growth of about
60% in the number of trainees engaged in all ITOs over the

New Zealand Engineering, Food and Manufacturing

four years.

Industry Training Organisation Incorporated


(COMPETENZ);

An example of how the seafood industry has sought to better align with education provision is outlined below:
The seafood industry, working with its ITO, has developed strong workplace-based training at levels 1-4 and
recognises the need for full tertiary education pathways. In the Nelson Marlborough region, local aquaculture
companies are working with Queen Charlotte College to run aquaculture courses at years 11, 12 and 13, which
include the opportunity for students to gain the Level 2 National Certificate in Aquaculture.
At the higher end of tertiary education, the Nelson Marlborough Seafood Industry Cluster is partnering with
TEIs in two TEC-funded projects to develop seafood-relevant curriculum at levels 5-9. Working with the
Nelson Marlborough Institute of Technology and Canterbury and Otago universities, the cluster aims to have
undergraduate and post-graduate diploma and degree programmes developed that will be directly relevant
to the industry. The cluster and universities are also working to improve opportunities for post-graduate student
research with the seafood industry.

40

3. Attractive Careers

Priority three is about how to make food and beverage

At the other end of the spectrum, with an aging workforce,

careers a more attractive option for youth, older workers,

there will be a high proportion of workers retiring over

those already in the workforce and those that could

the next 20 years. The sector needs to consider what can

potentially be in the workforce. Work to date on this

be done to retain these workers for longer to avoid skill

priority for food and beverage has been preliminary and

shortages. With an increase in the number of workers

will require further time and effort.

retiring, there will be increased pressure to find suitably


skilled and qualified managers and leaders within the sector

3.1 High Quality Workplaces and


Career Opportunities

to continue the success and growth of food and beverage

Action Points

skilled leaders and managers for the future.

The Department of Labour will contract a stock-take


of current initiatives in the areas of improving the
attractiveness of careers in this sector and promoting
opportunities offered. The findings of the stock-take
will be shared with industry.
Involve unions in developing solutions, including the
establishment of industry standards and the uptake
of technology and other productivity improvements,
to assist in improving productivity, wages and
conditions and therefore recruitment and retention.
Tailor education and training provision to include

businesses. Tertiary education training institutions will


need to consider how to ensure a sufficient supply of highly

Career paths need to provide for development, progression,


retention and be flexible enough to reflect fast moving
changes in consumer demands (eg. food technologists
are experiencing the impacts of an increasing consumer
health focus and demand for more sophisticated food and
beverage products).
Career paths may move within food and beverage subsectors, within the sector as a whole, across other sectors
and across different parts of the food and beverage value
chain (eg. pathways for manufacturing workers to move
into retail and wholesale, or where similar skill sets can be
deployed). There needs to be greater sharing of information

an increased focus on developing management and

within the sector (and across sectors) to recognise the

leadership capability, including the mechanisms to

transferability of skills and experience.

grow this capability over time.

A challenge for all sectors (including the food and beverage

Background

sector) is retaining workers with key skills and experience.

Some parts of the food and beverage sector are not seeing

including provision of career promotion opportunities. In

sufficient numbers of youth coming through the education

addition, the sector needs to consider ways of diversifying

system (to replace those retiring or leaving careers in

its workforce for example encouraging women into non-

the sector). The Human Capability and Agriculture and

traditional occupations.

Horticulture Group have an initiative to improve the


perception of agriculture and horticulture careers in
schools, which should assist youth to make decisions about
their future career7.

There are many forms of incentives for retaining staff

Employment security is a real issue for those that work in


seasonal parts of the sector. For example, meat workers
and fruit pickers need to know how to access alternative
work in off-seasons. A good example of a possible solution
for fruit pickers is the harvest trail (as mentioned in the
Introduction of this paper, under Transferring Learnings

7. Note that this initiative is aligned to the Markets Working Group recommendation
about building business capability.

41

across the Primary Sector), which is designed to move

To understand the current supply of those with higher

groups of pickers around the country to pick different

level qualifications in food and beverage, further work is

crops at different times of the year. This requires them to

necessary to determine the volume of completions and

be trained in picking a variety of fruit, rather than one type.

the relevance of their training to the sector.

Similarily, creative strategies are needed in other parts of

There needs to be a better understanding of whether

the sector. As a first step, the Department of Labour will

the sector needs more PhDs (and higher qualified people),

contract a stock-take to:

in what field, and whether businesses have the capability

Identify initiatives in the food and beverage sector that


are improving its attractiveness.
Identify work that has been carried out to promote high
quality career opportunities in the food and beverage
sector (or parts of the sector).

to adopt the science and technologies being developed in


New Zealand or overseas.
To have an innovative and productive workforce, the
sector needs to understand the values of those with
higher level qualifications and actively recruit them. This
means the sector needs to develop an understanding at
the management level of the potentially significant values

3.2 PhD Integration

that PhDs and those with higher level qualifications may


bring. Those values may be realised through exposing the

Action Points
The Science and Technology Adoption project has
considered the impact of the presence or absence of
PhD students (or such qualified staff), on businesses

food and beverage sector to new technology, and utilising


the knowledge of highly qualified employees to transform
knowledge into productivity gain and/or to add value to
goods and services.

ability to adopt science and technology.

Background
At the 17 November 2005 Food and Beverage Taskforce
meeting, it was noted that there was an opportunity
for greater integration of higher education PhDs within
companies. While a long term approach may be necessary,
it would be a good way for companies to increase their
focus on research and commercialisation opportunities.
If the sector wants to attract more PhDs and people
with higher level qualifications, it needs to become more
competitive in the labour market, have a stronger focus on
research and development and reward research initiatives
that contribute toward companies commercialisation
opportunities. It needs to be considered whether there
is sufficient supply of PhDs and those with higher level
qualifications relevant to the food and beverage sector,
and whether the sector understands the value of PhDs
and actively recruits them.

42

Government already supports PhD integration into

Other programmes are less direct in supporting the

companies by enhancing connections between tertiary

integration of PhDs into business. However, the focus

education/research organisations and businesses, in the

of such programmes is often on assisting businesses to

hope of increasing the flow of knowledge, technology and

build capability of, and access to, the benefits of research

ideas that have tangible benefits in the form of productivity

and development. A stronger focus on research and

growth. For example the Technology for Industry

development capability within and between food and

Fellowships programme of the Foundation of Research,

beverage companies will help to make the sector more

Science and Technology (FoRST) is designed to support

attractive to PhD graduates (and those with higher level

students studying at senior undergraduate level up to PhD

qualifications) and consequently lead to more integration

level qualifications, with the opportunity to apply their skill

of their skills into the work practices of the company.

and knowledge to a commercially-focused research and


technology development project. A PhD fellow is expected
to develop a substantial and original contribution to new
knowledge in the field of research, and to work within the
company premises for at least 50% of the time.

43

APPENDIX 1

AUSTRALIA/NEW ZEALAND STANDARD INDUSTRIAL CLASSIFICATION


(1996 version)
A Agriculture and Fishing
A01 Agriculture

A011

Horticulture and Fruit Growing


A0111

Plant Nurseries

A0112

Cut Flower and Flower Seed Growing

A0113

Vegetable Growing

A0114

Grape Growing

A0115

Apple and Pear Growing

A0116

Stone Fruit Growing

A0117

Kiwi Fruit Growing

A0119

Fruit Growing

A012

Grain, Sheep and Beef Cattle Farming

A0121

Grain Growing

A0122

Grain-Sheep and Grain-Beef Cattle Farming

A0123

Sheep-Beef Cattle Farming

A0124

Sheep Farming

A0125

Beef Cattle Farming

A013

A014

Dairy Cattle Farming


A0130

Dairy Cattle Farming

Poultry Farming

A0141

Poultry Farming (Meat)

A0142

Poultry Farming (Eggs)

A015

Other Livestock Farming

A0151

Pig Farming

A0152

Horse Farming

A0153

Deer Farming

A0159

Livestock Farming

A016

Other Crop Growing


A0169

Crop and Plant Growing

44

A02 Services to Agriculture; Hunting and Trapping


A021

Shearing Services

A0213

Aerial Agricultural Services

A0219

Services to Agriculture

Hunting and Trapping

A022

Services to Agriculture
A0212

A0220

Hunting and Trapping

A04 Commercial Fishing


A041

Marine Fishing

A0411

Rock Lobster Fishing

A0412

Prawn Fishing

A0413

Finfish Trawling

A0414

Squid Jigging

A0415

Line Fishing

A0419

Marine Fishing

A042

Aquaculture
A0420

Aquaculture

C Manufacturing

C21 Food, Beverage and Tobacco


C211

Meat Processing

C2112

Poultry Processing

C2113

Bacon, Ham and Smallgood Manufacturing

C212

Dairy Product Manufacturing

C2121

Milk and Cream Processing

C2122

Ice Cream Manufacturing

C2129

Dairy Product Manufacturing

C213

C214

45

Meat and Meat Product Manufacturing


C2111

C215

Fruit and Vegetable Processing


C2130

Fruit and Vegetable Processing

Oil and Fat Manufacturing


C2140

Oil and Fat Manufacturing

Flour Mill and Cereal Food Manufacturing

C2151

Flour Mill Product Manufacturing

C2152

Cereal Food and Baking Mix Manufacturing

C216

Bakery Product Manufacturing

C2161

Bread Manufacturing

C2162

Cake and Pastry Manufacturing

C2163

Biscuit Manufacturing

C217

Other Food Manufacturing

C2171

Sugar Manufacturing

C2172

Confectionery Manufacturing

C2173

Seafood Processing

C2174

Prepared Animal and Bird Feed Manufacturing

C2179

Food Manufacturing

C218

Beverage and Malt Manufacturing

C2181

Soft Drink, Cordial and Syrup Manufacturing

C2182

Beer and Malt Manufacturing

C2183

Wine Manufacturing

C2184

Spirit Manufacturing

C219

Tobacco Product Manufacturing


C2190

Tobacco Product Manufacturing

46

APPENDIX 2

WAYS TO ADDRESS SKILL SHORTAGES

d. Better publicity and information to encourage more


young people into the occupations, to give a better

Recommendations have been made that are appropriate

sense of the reality of occupations, and to address

responses to either a genuine skill shortage and/or a

negative images of some occupations.

recruitment and retention difficulty, although some are


occupation-specific rather than generic.

Chef

Fitter and turner

a. Training levels need to be raised to meet demand, with

Baker

Electrician

Butcher

Food technologist

emphasis on quality and value of training.


Chef

Fitter and turner

Baker

Electrician

Butcher

Food technologist

Dairy farmer/
dairy farm worker

e. Consider policies to address wage issues, and introduce

Dairy farmer/

family-friendly and other policies to improve working

dairy farm worker

conditions, to retain staff and attract new recruits, but


to also encourage back people who may have left the

b. Encourage under-represented groups to train in the


occupation (e.g. females in male-dominated occupations
such as fitter and turners, and electricians).
Chef

Fitter and turner

Baker

Electrician

Butcher

Food technologist

occupation (include those who emigrated).


Chef

Butcher

Baker

Food technologist

f. Research further the link between high levels of


migration inflows for an occupation and low wage levels/
growth (e.g. to determine whether high immigration

Dairy farmer/

suppresses wage growth, thereby contributing to

dairy farm worker

recruitment and retention difficulties).


Chef

c. Promotion of efficiency and innovation in work


practices e.g. to lighten workload and to reschedule
work hours.

47

to encourage retention.

Chef

Butcher

Baker

Dairy farmer/

g. Develop career paths for young and middle-aged people

dairy farm worker

Chef

Butcher

Baker

Food technologist

h. Reduction of training fees to encourage more people to


train for the occupation.

the government, industries and universities to be

Chef

Electrician

Butcher

Fitter and turner

Baker

Dairy farmer/

j. More research and development work involving

dairy farm worker

conducted with a significant role for food technologists


in the promotion of innovations in the food chain.
Food technologist

k. Raise/upgrade overall standard in production


management preferably to incorporate Lean

i. Increase immigration flows to address shortages.


Fitter and turner
Electrician

Sales/marketing manager

Manufacturing. Look to recruit from overseas


managers who are proficient in Lean Manufacturing
and have extensive work exposure with a global Food
Manufacturer. Better realignment between Marketing
and Production to ensure that a firms activity from
supplier to consumer is more streamlined.
Production manager

48

51%

30%

27%

62%

37%

Production Manager (Manufacturing)

Sales and/or Marketing Manager

Food technologist9

Chef

Dairy Farmer, Dairy Farm Worker

Electrician

Fitter and Turner

Butcher

Baker

12213

12241

21461

51221

61211

71311

72231

74111

74121

Fill rate
1
(2005)

EXPLANATIONS OF TERMS AND SOURCES

APPENDIX 3

49

0.9%
0.3%
1.7%
1.1%
1.5%
1.0%
0.6%

4.1%
2.6%
3.0%
1.9%
1.2%

0.6%

0.9%

Retirement
3
rate

Training
rate
2
(2005)

1.6
10.9
30.5
13.9
5.8
4.1
4.3

14%
17%
-10%
3%
38%
24%

19.5

7%
37%

12.1

-36%

149

42

213

306

604

2384

101

621

213

Growth in Employment Work permit


5
vacancies
(1000)
approvals
6
(Mar 2004(2004/05)
4
Mar 2006)

3.5%

1..0%

3.7%

2.2%

2.0%

21.9%

3.2%

3.2%

1.8%

$17.07

$16.12

$22.86

$23.89

$ 18.07

$15.18

$28.56

$52.06

$39.87

Approvals
Average
as % of
hourly wage
7
employment
rate

0.6%

0.8%

1.8%

2.2%

5.1%

1.1%

4.1%

2.1%

Annual
growth in
real wages
8
(2002-2005)

Yes

Yes

Yes

Yes

Yes

Yes

Possibly

Probably

Probably not

Genuine
skill
shortage

Yes

Yes

No

No

Yes

Yes

Possibly

Probably not

Probably not

Recruitment
& retention
difficulty

Sources for the above table:


1. Department of Labour, Survey of Employers who have Recently Advertised
2. Estimated by Department of Labour using data from industry training organisations,
Tertiary Education Commission and employment data from the Departments
Occupational Employment Model
3. Estimated by Department of Labour using data from Census of Population and
Dwellings and employment data from the Departments Occupational Employment
Model
4. Department of Labour, Job Vacancy Monitor. Growth in the number of vacancies
measured in the twelve months to March 2006 compared with the 12 months to
March 2004.
5. Department of Labour, Occupational Employment Model

7. Statistics New Zealand, Labour Cost Index, except Food Technologist which was
measured in the New Zealand Survey of Food Technologists, Department of Labour.
At December 2005.
8. Statistics New Zealand, Labour Cost Index.
9. Data for Chemical Engineer (the occupational category into which Food Technologists
are included) are provided for the following fields: Retirement Rate, Growth in
Vacancies, Employment, Work Permit Approvals, Approvals as percentage of
Employment.
Information sources included Immigration New Zealand (approvals for Skilled Migrant
Category and the General Skills category for 2003/04 and 2004/05), Statistics New
Zealand Census of Population and Dwellings 2001, Australia and New Zealand Standard
Industrial Classification (ANZSIC) 1996 and the New Zealand Standard Classification of
Occupations (NZSCO). A combined baseline scan of both sets of immigration and census
data resulted in a preliminary list of occupations that was then refined and revised by
the Skill Working Group.

6. Department of Labour. Measured from July 2004 to June 2005.

Explanations of Terms used in the above table.


Rating

Genuine skill shortage

Recruitment and retention difficulty

No

There is strong evidence that supply has grown


faster than demand for a considerable period
of time e.g. robust information on growth in
employment and growth in supply through
training and migration.

There is no evidence that trained people do not wish to take


up employment in this occupation e.g. no mention of this issue
from employers in the Survey of Employers who have Recently
Advertised and statistical evidence to support this e.g. wage
rates, data on occupational detachment.

Probably not

There is some evidence that supply has grown


faster than demand for a considerable period
of time e.g. evidence from indirect measures of
demand and supply balance such as wage and
vacancy growth.

There is no evidence that trained people do not wish to take


up employment in this occupation e.g. no mention of this issue
from employers in the Survey of Employers who have Recently
Advertised or statistical evidence to support this e.g. wage
rates, data on occupational detachment.

Possibly not

There is weak evidence that supply has grown


faster than demand for a considerable period
of time

There is weak evidence that there is not a pool of trained people


who do not wish to take up employment in this occupation e.g.
anecdotal evidence from an industry representative.

Yes

There is strong evidence that demand has


grown faster than supply for a considerable
period of time e.g. robust information on
growth in employment and growth in supply
through training and migration together with
direct measures of shortage such as a fill rate.

There is strong evidence that a considerable number of


trained people do not wish to take up employment in this
occupation e.g. statements from employers in the Survey
of Employers who have Recently Advertised and statistical
evidence to support the reasons for this e.g. wage rates, data
on occupational detachment.

Probably

There is some evidence that demand has grown


faster than supply for a considerable period of
time. (e.g. evidence from indirect measures of
demand and supply balance such as wage and
vacancy growth.)

There is some evidence that a considerable number of


trained people do not wish to take up employment in this
occupation e.g. consistent statements from employers in the
Survey of Employers who have Recently Advertised/industry
representatives or statistical evidence to support the reasons
for this e.g. wage rates, data on occupational detachment.

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DOL10230 AUG 06