The labour shortages farmers face today are going to become fundamentally worse in future, according to economist Shamubeel Eaqub.
Speaking at the DairyNZ People Expo in Invercargill, Eaqub said New Zealand’s demographics make this statement an ever-present reality.
“The biggest exports from provinces are young people. It’s not milk, it’s not dairy. We export young people like there’s no tomorrow. We are ageing really fast in the provinces,” he said.
Every advanced economy around the world faces the same labour problem, he said.
“We want the same workers wanted in the UK, wanted in Europe, wanted in Canada and America. Everyone is facing the same demographic aging we’re facing.”
Eaqub said NZ has a “weird political relationship with immigration” and that it goes from “feast to famine” very quickly, with one cohort in the country not able to live without migrants and another saying there are too many.
The country needs politicians to create stable immigration policies, he said.
Over the past year the net migration has been to urban centres, where infrastructure often cannot cope with the sheer numbers of migrants, but employers in provinces, such as farmers, need labour.
This contrast creates very difficult political conversations, he said.
Eaqub said the dairy industry employs about 40,000 people, with about 4000 leaving the industry every year, often because the work is seasonal.
More people leave the industry than enter it, he said.
“When you’re turning over 10% of your workforce every single year, what do you think it does to your retention and recruitment costs?” The number of workers per cow and per hectare has been trending down, he said.
This not only means farms have to be run more efficiently, but also that workers are working much harder.
Finding quality staff is not easy and farmers will have to invest in recruitment and training, he said.
To retain labour, farmers could manage the culture and leadership on farms, which would have an impact on labour and retention.
“We have to hold up the mirror and go, ‘What can I do that’s going to give me the ability to recruit and retain people?’”
Eaqub said the best and brightest labourers often leave first as they are in demand.
“Recruitment is expensive, training is expensive, and when you lose people that disruption is expensive. It’s a triple whammy of expensive every time you lose a person. You’ve got to put money into retention,” he said.
Recent surveys have shown that salary is not the main driver for retention, but that people want responsibility, fulfilment and purpose.
Farmers have to ask what they can do to make that possible, he said.
Also speaking at the People Expo, Waikato dairy farmer Sue Fish, from Westmorland Estate Limited, said to retain staff they try to give them a sense of ownership in the business.
The estate milks over 1000 cows across three farms.
For example, staff decide what behaviour is acceptable and unacceptable on the farm and are on equal footing with managers.
Unacceptable behaviour is simply called “below the line”, and if someone acts in such a fashion a manager is simply told that there is below the line behaviour.
This manner of speaking removes the emotion from the situation.
Staff also compete in a friendly employee-of-the-month competition, and participate in social outings, such as river rafting, to get to know each other outside the work environment, she said.
There are opportunities for personal and career development, and a clear work-life balance with work after 5pm a rarity, Fish said.
