KANSAS CITY, MISSOURI, US — From field to fork, the agriculture industry is facing a labor and skills shortage that is hurting its productivity growth, sustainability and economic impact. Competition for workers is fierce, and agriculture faces unique challenges such as a smaller labor pool in rural areas where agriculture is concentrated and a lack of knowledge in the career opportunities agriculture offers. Retirements are continuing, and the number of new entrants is not keeping pace. 

“It’s definitely competitive,” said Jessi Sletten, vice president, human resources talent acquisition for CHS Inc., a US-based diversified agribusiness cooperative that employs 10,000 people worldwide. “We’re looking for workers in an already somewhat small pond, so it’s just really competitive.”

About 1.23 billion people were employed in global agrifood systems in 2019, according to figures released by the Food and Agriculture Organization (FAO) of the United Nations in 2023. It was the first systematic and documented global estimate of its kind, including the whole agriculture process from food production through processing and transport. 

The FAO found that of the 1.23 billion people, 857 million worked in primary agricultural production and the remaining 375 million worked in off-farm segments of agrifood systems. Asia accounted for the largest number of people employed in agrifood systems at 793 million followed by Africa at 290 million. 

Agriculture labor shortages are leading to real economic losses as well as damaging morale and adding to the stress of current employees. Possible solutions include relying more on foreign workers, new outreach and education efforts and increasing automation and other technology to not only lessen the number of workers needed, but also add flexibility to the workplace. 

While the nature of labor shortages will evolve, and maybe even temporarily ease during an economic downturn, the problem won’t be eliminated, said Jennifer Ifft, associate professor and extension specialist in agricultural policy at Kansas State University. 

“It will look different because we’re going to continue to mechanize and get more efficient, but I don’t see these problems going away,” she said. “There’s definitely not a silver bullet or one-size-fits-all solution. Some of it is just good management advice, but it’s more important than ever. For the people you have, take good care of them, invest in them and invest in human resources more broadly.”

Quantifying the problem

Finding agriculture workers is a global problem and touches nearly every type of job, whether it’s hourly, salaried, laborer or manager, general skills, or specialist. The number of openings at CHS fluctuates and experiences seasonal ups and downs, Sletten said. At any given time, the company has a few hundred positions open, and in mid-March had about 500 openings. 

“This is likely the highest it will go,” she said. “Near the end of fall, the demand for seasonal workers will naturally ramp down. The biggest thing we have though is a talent demand where we are consistently looking for the same type of workers. It’s drivers, operators or skilled labor, and sales.”

Cargill, which employs 160,000 people across 70 countries, said despite some easing, the labor market remains very competitive and unemployment levels remain low in most parts of the world, said Steph Lundquist, chief human resources officer at Cargill. 

“We continue to recruit specialized skills that are in high demand worldwide,” Lundquist said. “Our global footprint and range of experiences available around the world not only creates meaningful careers for individuals which in turn provide the skills and experiences we need to fulfill our purpose of nourishing the world in a safe, responsible and sustainable way.”

In the United States, the US Department of Labor Bureau of Labor Statistics estimates that per year over the next decade there will be an average of 115,700 openings for agricultural workers; 88,000 openings for farmers, ranchers and other agriculture managers; and 3,000 openings for agricultural and food scientists. 

Canada’s agriculture sector is experiencing a “severe and chronic” labor shortage, according to a study by the Canadian Agricultural Human Resource Council (CAHRC). The sector, which includes crop production, animal production, support services and agriculture wholesale industries, employed 351,000 Canadians and 71,000 foreign workers in 2022.

During the peak season, an estimated 28,200 jobs were unfilled in 2022, for a vacancy rate of 7.4%. Two out of every five agriculture employers could not hire all the workers they needed that year, it said. 

Over the next eight years, the labor gap, which is the difference between the total number of workers required and the number of Canadian workers employed, is expected to increase 15% from 87,700 in 2023 to 101,100 by 2030 during peak season. Foreign workers are estimated to fill four out of five of those positions, leaving 22,200 jobs unfilled during the peak season at the end of the decade, CAHRC said. 

Within the agriculture sector, grains and oilseeds experienced a peak vacancy rate of 6.7% in 2022, with an estimated 2,300 positions unfilled. The labor gap for grains and oilseeds will increase 12% over the next eight years, from 3,280 in 2022 to 3,680 by 2030. 

The most difficult positions to fill will be managers and general farm worker positions. Managerial roles will account for 61% of the labor gap with general workers accounting for 18%.

Similar scenarios are playing out in Europe and Asia. In Ireland, 38% of vacancies are in general farming, meat processing, farm labor and food processing, said the Organization for Economic Cooperation and Development (OECD). About 40% of farm businesses said recruiting and retaining staff is difficult. The Netherlands reported a shortage of 1,600 qualified workers in the agro-food industry. 

Labor shortage has been a challenge for Japan for several decades, the OECD said, with an aging farm population and low number of new entrants. 

Across all economic sectors, agriculture also has the highest rate of skills misalignment, including over and underqualification, according to the OECD paper. Structural changes in the agri-food sector during the last two decades have changed the type of skills required in the sector. 

For example, the EU is expecting a 13% decline in employment in the sector with the largest drop expected for low-skilled workers. At the same time, there is an expected increase in demand for employees with management skills, digital know-how and business and marketing experience. 

“In terms of skills gaps, the largest are currently experienced in social skills and teamwork, problem solving, quality control systems and equipment maintenance,” the OECD said. “Having the appropriate matching of skills with the needs of the job is critical to optimizing sustainable productivity in the sector.”

Tangible, intangible impacts

Not having enough workers, or ones with the proper skills, is costly in terms of monetary losses from a drop in productivity and a loss of sales. Labor shortages in Canada caused a 3.7% decline in sales in 2022, which when applied to total sales in agriculture, resulted in an estimated C$3.5 billion loss in sales, according to a survey by CAHRC. Losses due to labor shortages within the grains and oilseeds segment amounted to C$594 million. 

Of the employers surveyed, 91% said lack of workers caused excessive stress for themselves and staff. More than half reported delays in production and 41% said they had to cancel or delay expansion plans. 

“Ultimately, these persistent vacancies are impeding growth for the whole industry,” CAHRC said. 

KSU’s Ifft and other researchers found in the study, “How Agricultural Labor Shortages Affect the Kansas Economy,” that economic activity in agriculture and agriculture-related sectors would potentially grow by $2.2 billion to $6.3 billion, if vacant agricultural positions were filled. Including indirect and induced effects, the state could generate $4.1 billion to $11.7 billion in additional output. This represents about 1% to 2% of the state’s gross regional product. Ifft said she would expect similar economic impacts in other agriculture-intense states. 

“It might seem small in relative terms, but in rural areas that have seen declining populations over time, these are real impacts,” she said. 

The economic impacts can ripple throughout the economy. For example, farms with lower production may purchase less inputs from firms upstream in the supply chain, Ifft said. 

“Because of weaker demand for their products, those firms then require fewer personnel who would spend money and otherwise contribute to the economy if employed,” the KSU study said. 

Beyond the dollars, labor shortages can take a toll on morale as businesses try to maintain a high level of service available to customers. The No. 1 concern is burnout and fatigue of the current staff, Sletten said. 

“We consistently watch for employee burnout and fatigue - both in busy times and slow times,” Sletten said. “In our busy season, we know the workload doesn’t decrease and we have to manage that. We have programs and resources available to help support employee wellness and to provide a good work environment.”

It’s also important to be mindful of the customer experience. For CHS, that includes farmer-owners who deliver grain to the cooperative’s grain elevators. 

“If you don’t have enough employees, there may be longer lines (at grain elevators) or slower responses,” Sletten said. “It’s just that overall customer experience of working with us. We don’t want that to be impacted because we are short-staffed.”

Increasing competition 

Labor and skill shortages are impacting many economic sectors, not just agriculture. That means increased competition, particularly for semi-skilled and skilled labor, the OECD said.  

Potential job candidates have a range of options, so depending on what’s important for them, whether that’s wage, commute time or overall flexibility, they can probably find it somewhere, Sletten said.

“Employers really have to try and meet the workers’ needs,” she said. “It used to be a one-size-fits-all. We would just try to be competitive and hope it attracted a lot of people. Now you must be more individual, more creative. Someone may say I really want to work there, but I need flexibility with my schedule. We’d probably say, ‘Let’s talk.’ 

“Employers have to be creative in how the work gets done because candidates will find another employer that will make that concession and be flexible for them.”

Greater flexibility is universally desired across all positions and regions, Cargill’s Lundquist said. The company is using strategies to offer more flexibility at its office centers and its manufacturing facilities that will attract and retain more employees. 

It’s harder for agriculture to compete, in part because facilities tend to be in rural areas, which have smaller populations. 

Forty percent of respondents to the CAHRC survey said their rural location makes recruitment more difficult. Several factors contributed to this, including declining population, lack of transportation options and lack of other amenities and resources.

Trying to relocate someone to a rural area can be a challenge, Sletten said. They want to know what resources are available such as employment for a spouse, childcare and the quality of the school system. 

An aging agricultural workforce adds to the problem as the number of new entrants is not keeping pace, the OECD said. 

“Entry barriers to the sector are a concern and include high startup costs, geographical isolation, fragmented rural infrastructure, relatively low remuneration, poor working conditions and the negative perception of farming as a professional career,” it said. 

In Canada, retirements by 2030 will amount to a loss of 30% of the current workforce, CAHRC said. Within those retirements, the tree fruit and vine, grain and oilseed, and beef industries are expected to account for the largest share due to their older age profiles and occupational makeup. 

Job requirements also can be a turn-off to potential workers, including the amount of manual labor, CAHRC said. It found that 59% of employers said the requirement to perform manual labor was a top recruitment hurdle.

Other factors include the seasonality of some positions, low wages and lack of awareness of career opportunities in the agriculture industry. 

“Common perceptions of agriculture tend to be outdated and often miss the extent to which innovation and technology have created and transformed numerous occupations in the sector,” CAHRC said.