Food and drink manufacturers are slowly starting to recruit again as confidence levels improve, but problems in the housing market and worries over energy prices continue to thwart progress, according to recruitment agencies specializing in the food sector.
The job market in new product development (NPD) has held up reasonably well during the downturn, although housing problems have made it hard for companies to secure candidates for specialized R&D roles, said John Scerbo, president of Illinois-based executive search firm for food industry professionals, Foodemployment.com.
“This is making it hard to find the right people for highly specialized positions where a company wants a flavor scientist with particular expertise in savory products, for example. But generally, we are seeing more roles in beverages and nutritional-type products, plus snacks, which have held up in the recession because they are affordable treats.
“In NPD, trends have been pretty consistent for the last three to five years. Things did drop off in operations and other areas, but in the past couple of months, we’ve been busier than ever.
“However, employers are not offering the re-location packages they used to and a lot of skilled people cannot move for a job, even if a great opportunity comes up, because they can’t sell their house.”
NPD: You can’t batten down the hatches forever…
Even where companies had held back on product development, many recognized that they could only batten down the hatches for so long, said Angela Dorsey-Kockler, product manager at BI Nutraceuticals.
“We have seen some companies scale back what they are doing, but I don’t know that we’ve seen a slow-down in major new product development projects because they have such a long lead time.”
Meanwhile, while the big new projects exploring functional ingredients, wholegrain, fibers and products that would allow firms to build a presence in weight management, digestive health, energy and immunity were keeping people in work, there was also continuing pressure to reformulate to reduce sodium, artificial colors, flavors and preservatives, which was creating work for people with specialist skills, she added.
“People are looking at the ingredients list and asking themselves do I recognize this? Can I pronounce that? If you can replace ascorbic acid [vitamin C] with something like baobab, a fruit that’s naturally high in vitamin C, it sounds much more natural and healthy.”
Scott Martling, global business development director at product development firm International Food Network, said the recession had also created job opportunities at manufacturers supplying restaurant-type foods to supermarkets as people have been eating more at home, along with those specializing in private label lines for major retailers.
“The biggest impact has been people switching allegiance to private label. This used to be around 10 percent of sales at some of the big chains and in some cases it’s getting close to 30 percent.”
Rising costs and fragile consumer demand
But Brian Mader, president of New York based Crescent Search Group, said a lot of firms were still holding back on replacing people in positions that weren’t mission critical, while rising raw materials and energy prices coupled with fragile consumer demand made it hard to raise prices.
“It makes people risk averse. They can’t plan ahead so they are very cautious about everything, including recruitment. Things did pick up in late 2010, but are beginning to slow down again. However, we have seen more interim work where people would bring in someone on a temporary contract to solve a problem, but not keep them on full time.”
Scott Myers, president of Indiana-based Corporate Search Consultants, said some clients had put a blanket freeze on recruitment while others were “carrying on as normal”.
He added: “Things started to get worse in late 2007. I hear people saying things are starting to get better and more positions are opening up, but they are taking longer to make decisions.”
Meanwhile, the lack of mobility amongst the skilled labor force meant the right candidates were not able to relocate, he said.
“Unless companies are willing to work with good candidates to get around the housing problem, it’s not going to go away anytime soon.”
Russ Hovendick, president at South Dakota-based Client Staffing Solutions, said he started to see firms put a freeze on hiring from mid-2008, although things had improved recently.
However, the recovery was fragile, he said. “If gas prices continue to rise, that will hit the job market.”