Grocery Store Shortages Are Back. Here’s Why.

January 19, 2022 Admin 0 Comments

A worker shortage exacerbated by the omicron surge has led to empty meat cases and moldy produce nationwide

This story was originally published on Civil Eats.

At a Giant supermarket in Maryland this Tuesday evening, shoppers were surprised to discover that coolers and bins that normally held bananas, leafy greens, and onions were completely empty. “This is freaking me out,” one man confided to another, as they circled the area in confusion. In the meat department, the only item in a cooler normally filled with chicken breasts was a sign indicating they were temporarily out of stock “due to recent surges in COVID-19 cases and the resulting labor shortages.”

In what can feel like a repeat of spring 2020, people are sharing photos of similar scenes at stores around the country, and reports of empty shelves are coming in from Massachusetts and Florida. While this round of shortages has some things in common with the last one, a lot has changed in the two years since Americans — both at home and in Washington, D.C. — began paying attention to food supply chains in a new way.

Once again, experts and food companies say that there is plenty of food in the country, but a bundle of factors along the supply chain appear to be preventing it from getting to shoppers. What’s new is a shortage of workers that began with the Great Resignation and has spiked with the omicron surge, compounded by short-term disruptions in certain industries and regions from extreme weather and produce recalls.

While companies are hustling to get through the surge and expect things to level out soon, some are also already working to change their models to avoid similar challenges in the future, and experts say how the food system operates is certain to change in longer-term ways.

The Supply Chain Right Now

“We don’t have a problem with farms producing enough food. We have problems with not enough labor in the supply chains between the farms and the consumers,” said Paul Lightfoot, president and founder of BrightFarms, a company that grows leafy greens hydroponically at five indoor farms in the Midwest and on the East Coast.

Since the start of the pandemic, workers in many industries have been quitting their jobs in high numbers. Food workers across the supply chain have long been some of the lowest paid across industries and subject to terrible working conditions; now they’re facing burnout. During COVID-19, workers in meatpacking plants, food manufacturing plants, grocery stores, and restaurants suffered through outbreaks and deaths, while being pushed to work harder to meet increased demand.

In November, a month when 4.5 million Americans quit their jobs, six representatives from a broad cross-section of the country’s food system told the House Agriculture Committee that the labor shortage is the number one “immediate” issue facing national supply chains. And then omicron hit.

“The food industry continues to adapt to a shifting marketplace, but the bottom line is that we must have access to a stable workforce in order to adequately meet the demands of American consumers,” Greg Ferrara, the president and CEO of the National Grocers Association, told congressmembers at the hearing.

Ed Cinco, director of purchasing for Schwebel Baking Company in Ohio, said his company had never faced a shortage of workers so pronounced in its 115-year history. Jon Samson, the executive director of the Agricultural & Food Transporters Conference, said the trucking industry, which moves food, packaging, and other items used in food production from ports to warehouses, farms to distribution centers, and distribution centers to supermarkets, was short 80,000 workers.

Two months after the hearing, the number of COVID-19 cases reported around the country daily has increased more than eight-fold. That means that while food, trucking, and grocery companies were already scrambling to hire, now a more significant number of the workers they do have are staying home due to illness. While vaccines have cut rates of serious illness and death compared to previous surges, even employees with mild or no symptoms are advised to stay home and quarantine to prevent the spread of the virus.

At Egg Innovations, an egg company with a processing hub in Warsaw, Indiana, and a network of 50 farms in five Midwestern states, president and co-founder John Brunnquell told Civil Eats that their farmers’ egg production has not decreased, but he has been managing significant labor challenges for the past 12 to 15 months. Omicron then made an existing issue exponentially worse.

“Just when one person gets healthy, it seems like the next person gets sick,” he said. The company has turned to solutions like paying overtime, outsourcing trucking, and hiring temporary staffing, but those strategies come with challenges too, and all of this is happening at a time when demand for his product is going up.

Early in the pandemic, COVID-19 caused the most significant disruptions to meat production. In many cases, that was due to companies not implementing worker protections in advance, and deadly outbreaks shut down plants and left some farmers with nowhere to send their animals. Now, labor issues are flaring up again. On Monday, Reuters reported that rising cases among both workers and meat inspectors has caused big companies including Cargill and Perdue Farms to slow down production.

Chandan Khanna/AFP via Getty Images

According to a new analysis out of Purdue University, among various food manufacturing industries, “animal slaughtering and processing” is most likely to be significantly impacted by disruptions in labor. Because so many individuals are needed to take an animal from slaughter to packaged meat, “If something happens, it actually leads to a much larger loss in production compared to any other food industry on that list,” said Ahmad Zia Wahdat, a researcher who worked on the data and paper with Jayson Lusk, the head of agricultural economics at Purdue.

Zia Wahdat also worked on a dashboard that estimates how many workers in different food sectors have likely missed work due to COVID over the last year. For the 30 days leading up to January 11, an estimated 13,000 workers in meatpacking, 12,400 in bakeries and tortilla manufacturing, and 8,400 in beverage manufacturing had COVID-19.

And while labor shortages are disrupting production and affecting distribution, workers are also missing from at the grocery stores themselves, often leaving shelves unstocked. Heinen’s in Ohio and Harris Teeter in North Carolina both announced they would cut their hours due to staffing shortages.

Still, it’s not easy to predict where and when products will be out of stock, because a number of compounding factors adding to disruptions are specific to some foods and regions.

For instance, backlogs at the country’s ports is another important factor, even for some foods that are produced domestically. Baking companies in Ohio are struggling to import the spices and seeds they normally purchase from India, for example, while fruit and vegetable farmers in Georgia who typically replace a tractor tire within a day are now waiting a week.

Over the past month, the nation’s salad green supply was also hit by E.coli-related food safety recalls, and when disruptions occur, fresh produce tends to be out of stock first, since it goes bad so quickly. To offset those shortages, BrightFarms’ Lightfoot said his company has been “shipping larger deliveries, but it is difficult to offset the tremendous volume that comes from West Coast field growers.”

Meanwhile, eggs may be harder to find in coastal states, Brunnquell said, because many big companies base their operations in the Midwest in order to be close to their feed supply.

Finally, there’s the weather. A string of snowstorms hit the East Coast last week, and in an emailed statement, Giant attributed its supply shortages to weather in addition to of labor. “It doesn’t have to be local,” either, explained Andrew Novakovic, an emeritus professor of agricultural economics Cornell University. An ice storm that closes roads in Iowa, for example, could stall pork shipments to stores in warmer locales. For instance, a shortage of potatoes in Japan right now is partially due to a flood at the port of Vancouver.

How Will Today’s Disruptions Impact the Future?

In the short term, experts predict the Omicron surge is at its peak on the East Coast and will end in the coming weeks as more people begin to return to work. But even if COVID fades into the background at some point in the future, underlying issues related to the food system’s workforce will remain.

“The Great Resignation is related to the pandemic, but it’s not about being sick,” said Novakovic. “It’s about dealing with the consequences of workforce issues that finally reached a tipping point and got people thinking differently.”

Companies are going to be looking for ways to operate with fewer people, and Novakovic said evidence of an accelerated shift to automation is already showing up. Many fast food restaurants now ask you to order on a touchscreen, for example, instead of verbalizing your order to a human, and John Deere just brought its first fully automated tractor to market.

At Egg Innovations, Brunnquell said his team has been looking at options to automate wherever they can. “Even if we get to a spot... where COVID doesn’t exist or it’s very benign, it’s going to leave a legacy of an entirely different manufacturing process,” he said. What this shift will mean for workers and communities and whether it will lead to better, safer jobs or leave low-income communities in the lurch is already being considered by academics, worker advocates, and farmers in many places.

Brunnquell is also shifting the company toward sourcing more domestically to avoid future global shipping delays. In 2021, about half of the organic soybean meal Egg Innovations’ farmers fed to chickens came from India; this year, all of it will come from American farmers. Increased interest in domestic soy and corn has sent feed prices soaring, though, and the company is upping its supermarket prices to reflect that cost.

Similarly, companies like BrightFarms are focused on producing fresh foods closer to where they’re headed, so that customers on the East Coast, for example, won’t rely entirely on California for greens. And it’s not just indoor farming that’s looking closer to home: The pandemic has boosted a number of projects to strengthen local and regional food systems from grain to meat, and the U.S. Department of Agriculture recently announced investments in small- and medium-sized meatpacking plants, which are more likely to produce meat for local, not global, markets.

Another shift that is already happening, Novakovic said, is that many supermarkets will go back to having “precautionary stocks” of certain popular items. Previously, the rapid expansion of Walmart’s low-cost model pushed the entire industry to “just-in-time” stocking in order to keep costs as low as possible to compete, he said. But the pandemic has revealed the reasoning behind the other option: a “just-in-case” model. That model involves added costs due to warehousing, so stores will essentially be asking consumers to pay more for the assurance that the food they need will be in stock.

In the end, it’s clear that we’re not the only ones who have been changed by COVID; our food supply — with all its myriad complications — has clearly been changed as well.

• Why the Food Supply Chain Is Strained. Again. [Civil Eats]