Low-Wage Work in the United Kingdom

6. Supply Chain Pressures and Migrant Workers: Deteriorating Job Quality in the United Kingdom Food-Processing Industry

CHAPTER 6 Supply Chain Pressures and Migrant Workers: Deteriorating Job Quality in the United Kingdom Food-Processing Industry Susan James and Caroline Lloyd The food-processing industry is one of the largest manufacturing sectors in the United Kingdom, employing approximately 413,000 workers, representing just under 13 percent of manufacturing employment (ABI 2006). Despite its size and importance, it is in slow decline as consumer expenditure on food stagnates, prices are squeezed, and imports grow. Large supermarket chains increasingly dominate the sale of food products and exert considerable power over large parts of the processing sector. The changing patterns of consumer demand, intensified pressure from retailers, an oversupply in some sectors, and increased levels of regulation, particularly in relation to food hygiene, have led some commentators to describe the environment as “fiercely competitive” (see Dench et al. 2000; IDS 2004; Wilson and Hogarth 2003). Automated, continuous production processes, using a predominantly low-skilled workforce, are prevalent within much of the industry , and a high proportion of companies produce relatively simple , standardized products for the mass market (Mason, Van Ark, and Wagner 1996; Wilson and Hogarth 2003). The work of food-processing operatives is often low-paid and routine, sometimes physically unpleasant, and prone to high levels of accidents. Recent data indicate that around one-third of jobs fell below the low-pay threshold (LPT) in 2006, with that figure rising to over half for women workers (ASHE 2006). Reflecting the position of many companies as “bottom -end” employers, migrant workers have been an important source of labor for a number of years, a trend that has intensified with the expansion of the European Union and the growth in temporary agencies. However, not all jobs are the same: a few high-profile com211 panies offer better wages than others, and a range of considerable additional benefits, including pensions. This chapter examines the extent to which changing competitive conditions within food manufacturing are affecting the quality of process operatives’ jobs. The first section sets the context for the research by identifying the key features of the UK food-processing industry and the main characteristics of operative jobs. The next section outlines the research methodology, which is based on six case studies undertaken within the meat and confectionary subsectors. The main part of the chapter draws on these cases to explore the ways in which management has sought to improve competitiveness and its implications for the quality of employment. In this investigation we emphasize work organization, health and safety, pay and benefits, and opportunities for progression. The final section considers how far the regulatory and institutional environment has shaped elements of job quality. The evidence from this chapter indicates that in the absence of a tightly regulated labor market, the increasing power of the supermarkets, alongside the widespread availability of cheap migrant labor, has placed downward pressure on terms and conditions of employment . THE UNITED KINGDOM FOODPROCESSING INDUSTRY The food-processing sector has traditionally been regarded as one of the more successful parts of manufacturing in the United Kingdom. In the early 1980s, it was second to the United States in terms of output and in ownership of the world’s largest multinational companies (MNCs) (Smith, Child, and Rowlinson 1990). Although it still remains an important part of the manufacturing sector, with a turnover of £66 billion (US$135 billion) in 2005 (ABI 2006), and does reasonably well in comparative productivity measures, it has nevertheless slipped behind Germany and France to become the third-largest food manufacturer in Europe. As with many other advanced industrialized economies, consumer expenditure on food in the United Kingdom has failed to keep pace with the growth in national income, and real food prices have been in decline. The combination of these trends, alongside a growing penetration of the UK market by imports, has seen the value of turnover fall by 10 percent over the last decade. Despite concerns about foreign competition, the sector is far less open 212 Low-Wage Work in the United Kingdom than many others, with imports accounting for only 26 percent of the market in 2004 (ONS 2006a). The perishable nature of many products , the existence of specific national tastes, and the bulkiness of certain foods that makes transport costs prohibitive help maintain home production advantages (Dench et al. 2000). Over 15,000 enterprises are involved in the manufacture of food products in the United Kingdom. Around 90 percent of these...