skills acTion Plan for The food and Beverage secTor - Department of ...

Skills Action Plan for the
Food and Beverage Sector
Towards a high skill, high wage, high value economy
REPORT TO THE FOOD AND BEVERAGE TASKFORCE FROM THE SKILLS WORKING GROUP
JULY 2006

PREFACE
The Food and Beverage Skills Working Group was established to support the Food and Beverage Taskforce. Members of the
Group are as follows:
name
Carol Beaumont (co-chair)
Alison Dalziel (co-chair)
Peter Harris
Alison Quesnel
Carl Ammon
Hugh Campbell/Cheryl MacGregor
James Ritchie
Jo Wills/Nick Brownsword
Paul Pearson/Paula White
Mark Jefferies/Allan Frazer
Jo Sceats
Barbara Johnsen
Carolyn Holmes
Peter Ettema
Kay Nelson
organisaTION
New Zealand Council of Trade Unions
Department of Labour
Taskforce Secretariat
Blackmores Ltd
New Zealand Industry Training Organisation
and Industry Training Federation
New Zealand Trade and Enterprise
New Zealand Dairy Workers Union
Fonterra Co-operative Group Ltd
Tertiary Education Commission
Meat and Wool New Zealand Ltd
Department of Labour
Seafood Industry Training Organisation
Ministry of Education
Ministry of Agriculture and Forestry
Wellington Institute of Technology
Contributors to the skills and training workshops included the Agriculture Industry Training Organisation, Competenz,
Lincoln University, AgResearch, Horticulture Industry Training Organisation, the Tertiary Education Commission, the
Department of Labour, New Zealand Trade and Enterprise, the New Zealand Council of Trade Unions, Business New Zealand,
and the Beer, Wine and Spirits Council of New Zealand.
The Skills Working Group would like to acknowledge Jo Sceats from the Department of Labour for preparing this report
on its behalf.
ISBN 0-478-28065-3

CONTENTS
PREFACE 1
CONTENTS 2
CHAIRS’ LETTER 3
EXECUTIVE SUMMARY 5
Skills Action Plan for the Food and Beverage Sector 5
Implementation 8
INTRODUCTION 10
FOOD AND BEVERAGE EMPLOYMENT 15
Background 15
Transformation Theme 16
Key Facts about the Food and Beverage Sector 16
SKILLS WORKING GROUP PRIORITIES 22
1. Better Labour Market Information 22
1.1 Forecasting Framework 22
1.2 Productivity 26
1.3 Skill Shortages 31
2. More Strategic Investment in Training 36
2.1 Workplace Practices 36
2.2 Community Awareness 36
2.3 Responding to Changing Occupations and Skill Needs 37
2.4 Quality and Relevance 38
3. Attractive Careers 41
3.1 High Quality Workplaces and Career Opportunities 41
3.2 PhD Integration 42
APPENDIX 1: Australia/New Zealand Standard Industrial Classification 44
APPENDIX 2: Ways to Address Skill Shortages 47
APPENDIX 3: Explanations of Terms and Sources 49

CHAIRS’ LETTER
Mr Tony Nowell
Chairman
Food and Beverage Taskforce
WELLINGTON
Dear Tony,
The Skills Working Group strongly supports the transformation theme (i.e. towards a high skill, high wage and high value
economy) for the food and beverage sector. While it is possible to win new international markets and develop innovative
products and services, it will be difficult to achieve this without the right skills, in the right place at the right time, being
applied in productive, high quality workplaces.
If the food and beverage sector in New Zealand (20% of the total New Zealand workforce) attracts and develops its
workforce effectively, this will make a major contribution to the government’s economic transformation agenda. The
benefits it will provide for the New Zealand economy include spin-off effects for other related sectors such as health,
hospitality and tourism.
There are significant labour market opportunities for the food and beverage sector that the Food and Beverage Taskforce
could consider, such as:
• supporting improvements in business productivity;
• improving science and technology adoption practices;
• applying a forecasting framework for sustainable labour to better manage turnover;
• increasing integration of foundation skills into education and training provision;
• increasing support and encouragement for the uptake of relevant vocational qualifications (including higher
level qualifications) that provide a good match to associated job opportunities;
• increasing collaboration among Industry Training Organisations (ITOs), Tertiary Education Institutions (TEIs) and
government agencies;
• improving planning and resource utilisation for training investment;
• implementing strategies to address genuine skill shortages and recruitment and retention difficulties;
• improving career development, employment opportunities and employment security; and
• continuing and extending active support for alternative employment, preferably in the food and beverage sector,
with tailored programmes for individual workers and investment in education and training for employees affected by
business closures, downsizing and relocations. This would involve working with employers, unions, ITOs, other education
providers and agencies of government and local government.

A number of these opportunities were identified during the taskforce consultation process and have been reflected in the
Skills Action Plan for the food and beverage sector.
Given the momentum that has built up around the food and beverage sector engagement, it would be beneficial for the
sector if key stakeholders continue to have strategic dialogue in support of implementing agreed initiatives in the Skills
Action Plan.
The Skills Working Group therefore supports an ongoing food and beverage sector organisation to oversee implementation
of the Food and Beverage Sector Development Agenda. This organisation would actively lead transformation throughout
the sector; connect with other related sectors; and gain sector buy-in to own and maintain transformation in future years.
It is proposed that a new industry-led group be established called the Skills and Training Action Group (STAG) that will
consist of the relevant education and training organisations, industry and government agencies. This group would oversee
implementation of the Skills Action Plan within the context of the Food and Beverage Sector Development Agenda. The
scope of the group would include collaboration among food and beverage education and training providers to achieve more
focused provision; improve the level of knowledge about the workforce in the food and beverage sector (eg. forecasting
and areas of short supply and high demand); encourage workplace best practice initiatives (eg. productivity and foundation
learning) and increase alignment between provision of food and beverage qualifications and actual job opportunities within
the sector.
In addition to STAG, a tripartite initiative, based in the New Zealand Council of Trade Unions, is proposed. This would
establish a workforce centre of excellence for the food and beverage sector. The centre would promote worker
engagement and commitment to deliver the Food and Beverage Taskforce Development Agenda. The Skills Working
Group supports this proposal and the opportunity for STAG to both inform and be informed by the centre.
In the meantime, the Skills Working Group will continue meeting over the next few months to monitor three remaining
major projects (ie. the productivity study, the science and technology adoption research, and the career-of-choice stocktake).
A progress report will be provided against the Skills Action Plan once the three major projects have been completed
and STAG has been established and operational for at least three months. The report will also include an outline of how
implementation of the Skills Action Plan will be monitored going forward.
The group has identified key skills and training issues for the food and beverage sector – ways to lift its performance and
increase value. We commend the Skills Action Plan to the Taskforce.
Carol Beaumont
New Zealand Council of Trade Unions
Alison Dalziel
Department of Labour

EXECUTIVE SUMMARY
Food and beverage key stakeholders support the need for
transformation in order for food and beverage companies
to survive in a competitive, global market by:
• attracting and retaining suitable and sufficient
numbers of employees;
• up-skilling current workers and providing career
pathways;
• integrating and applying top talent;
• innovating and making effective and efficient use of
technology;
• predicting skill and labour needs; and
• enabling labour and capital growth in a productive
manner that supports changing demands of food and
beverage customers.
The Skills Action Plan (below) is being incorporated into
the Food and Beverage Taskforce Development Agenda.
Skills Action Plan for the Food and Beverage Sector
Priority 1: Better Labour Market Information
Forecasting
• The food and beverage forecasting framework will be implemented and applied to all food and beverage
sub-sectors and maintained on an ongoing basis. This would involve food and beverage ITOs (as part of their
strategic skills leadership role) to assist in the implementation of the framework in conjunction with other
relevant organisations.
• The proposed Skills and Training Action Group (STAG) will guide consistency of application of this framework
within the food and beverage sector, improve the framework and test its robustness with respective industry
organisations and training organisations.
Productivity
• Complete the productivity study currently underway, which will identify productivity issues specific to food
processing businesses.
• The New Zealand Council of Trade Unions will use the findings of the productivity study to inform the Workplace
Productivity Education Programme and in developing resources for union delegates and future productivity
initiatives.
• A first phase of science and technology adoption research has been completed. The findings will be taken
forward with industry and relevant agencies.

Skill Shortages
• Information has been gathered for the Skills Working Group on genuine skill shortages and recruitment and
retention difficulties for bakers, butchers, chefs, dairy farmers and dairy farm workers, and food technologists.
Appendix two outlines ways to address these issues. The Skills Working Group will consider how to best promote
these solutions.
• Efforts will continue to improve the quality of labour market information about skill shortages in the food and
beverage sector to better inform tertiary education and training strategies and priorities.
Priority 2: More Strategic Investment in Training
Workplace Practices
• Promote and explore industry best practice and incentives in relation to skills development.
• Increase employee participation in training and support for the Council of Trade Unions Learning
Representatives Scheme.
Community Awareness (also see priority three – Attractive Careers)
• Develop learning resource materials for curriculum in primary and secondary schools that reflect the
importance of the food and beverage sector as a major employer and contributor to New Zealand’s economy.
• Promote careers to parents, youth, teachers and careers advisors that reflects the reality of working in the
food and beverage sector (ie. how sophisticated jobs are now).
• Support initiatives from the Human Capability Group in Horticulture and Agriculture, which involves a schools’
curriculum strategy with goals to increase the profile of the sector, change schools’ perception of the sector,
increase the number of people seeking careers in the sector (eg. more science students), and introduce
resources across the curriculum. In addition and alignment with this work, it is intended to encourage a
coordinated cross sectorial approach to career promotion in schools.
Responding to Changing Occupations and Skill Needs
• Explore ways to improve the ability of the skills and training system to adapt to rapidly changing and new
occupations.
• Increase support for initiatives that could be undertaken by Learning Representatives and build on current
work with a group of ITOs to integrate literacy training with industry training (eg. in seafood and agriculture).

• Communicate the relationship between high levels of foundation skills in food and beverage businesses and
favourable productivity results.
• Increase support and encouragement for the uptake of relevant vocational qualifications (inclusive of higher
level qualifications) that provide a good match to associated job opportunities.
• Continue and extend active support for alternative employment (preferably in the food and beverage sector)
with tailored programmes for individual workers and investment in education and training for employees
affected by business closures, downsizing and relocations. This would involve working with employers, unions,
ITOs, other education providers and agencies of government and local government.
Quality and Relevance
• The Skills Working Group recommend in relation to the tertiary reform process, that funding must be linked to
the new Tertiary Education Strategy and the Statement of Tertiary Education Priorities. This should include a
stronger feedback loop between the Tertiary Education Commission (TEC) and industry and a greater capacity
for ITOs to influence funding and priority setting.
• The TEC and other government agencies will facilitate greater partnering of delivery between ITOs and Tertiary
Education Institutions (TEIs) to better meet industry needs and enable them to be more responsive to emerging
demand through its profile negotiation process and support for the ITO leadership role.
• Review the quality and relevance of the large number of food and beverage related qualifications with a
view to consolidating them into a smaller number of higher quality courses. In specialist areas, the option of
consolidating into one centre of excellence in New Zealand should be considered (eg. fishing, dairy and meat
processing and grape processing).
• Review the relationships amongst polytechnics, ITOs, industry and unions in setting food and beverage related
qualifications and ensuring quality and relevance of training.

Priority 3: Attractive Careers
High Quality Workplaces and Career Opportunities
• The Department of Labour will contract a stock-take of current initiatives in the areas of improving the
attractiveness of careers in this sector and promoting opportunities offered. The findings of the stock-take
will be shared with industry.
• Involve unions in developing solutions including the establishment of industry standards and the uptake of
technology and other productivity improvements to assist in improving productivity, wages and conditions and
therefore recruitment and retention.
• Tailor education and training provision for the food and beverage sector to include an increased focus on
developing management and leadership capability, including the development of mechanisms to grow this
capability over time.
PhD Integration
• The Science and Technology Adoption project has considered the impact of the presence or absence of PhD
students (or such qualified staff), on businesses’ ability to adopt science and technology.
Over the next few months it is proposed that the Skills
Working Group continue meeting to monitor progress
and completion of three remaining major projects (ie.
productivity study, the science and technology adoption
research and the career of choice stock-take) and
provide a progress report against the Skills Action Plan.
The progress report will also include an outline of how
implementation of the Skills Action Plan will be monitored
going forward.
IMPLEMENTATION
A new industry–led group called the Food and Beverage
Skills and Training Action Group (STAG) is proposed to
be established to oversee implementation of the Skills
Action Plan.
STAG will consist of the relevant education and training
organisations, industry and government agencies. It is
anticipated STAG will have a role in collaboration among
food and beverage education and training providers to
achieve more focused provision, by improving the level of
knowledge about the workforce in the food and beverage
sector (eg. forecasting and areas of short supply and high
demand); encouraging workplace best practice initiatives
(eg. productivity and foundation learning); and increasing
alignment between provision of food and beverage
qualifications and actual job opportunities within the
sector.
There is a general willingness of food and beverage related
ITOs, unions and government agencies to work more
closely together.
STAG will take issues to Skill New Zealand (a TEC supported
initiative involving the New Zealand Council of Trade
Unions, Business New Zealand and government agencies)
as needed to promote awareness about potential training
options and the need for industry support.

In addition to STAG, it is proposed that a Workforce
Centre of Excellence be established, based in the New
Zealand Council of Trade Unions. The centre would be
governed by a steering committee with Government,
Business, New Zealand Council of Trade Unions, ITOs
and other relevant industry organisations. The centre
of excellence would ensure worker engagement and
commitment to the delivery of the Food and Beverage
Sector Development Agenda. The Skills Working Group
supports this proposal and the opportunity for STAG
to both inform and be informed by the centre.
The centre would include complementary actions in three
interacting and overlapping fields:
• Skill and engagement of the labour force
• Innovation and improved application of best available
technologies
• Organisational change to improve collaboration.
The centre will promote workforce excellence through:
• Engaging with workers in the food and beverage
sector
• Utilising existing worker representatives
• Building from existing activity and knowledge
• Developing confidence of workers that their needs and
aspirations are reflected in transforming the sector.
The centre will develop a model of worker involvement in
industry development that:
• Drives the development agenda set out by the
Taskforce
• Integrates a range of initiatives that are relevant
to that development agenda (eg. skills enhancement,
foundation learning, health and safety, productivity,
partnership)
• Promotes engagement and participation at all levels
in the sector
• Develops and promotes best practice in the workforce
where the links between skills, learning, engagement,
participation and productivity are understood and
promoted.
The Workforce Centre of Excellence has potential to
complement the work of STAG and assist in implementing
the Skills Action Plan.

INTRODUCTION
Background
Food and beverage is one of the sectors identified under
the Growth and Innovation Framework (GIF) as being key
to New Zealand moving up the GDP per capita ranking of
OECD member countries. The food and beverage sector is
pivotal to the economy’s growth and export trade. There
is already a high level of interaction occurring between
government agencies and the sector.
In 2004, Cabinet agreed that a Food and Beverage
Taskforce be established with supporting working groups
to create a three to five year “Development Agenda” for
the sector. The Agenda would include bold targets and
secure stakeholders’ ownership and commitment to
implementing it. The ideal outcome of the taskforce would
be that the resources of industry, government, science
and education are focused in partnership to deliver
faster, smarter, and more sustainable growth in the food
and beverage sector.
The Skills Working Group is one of three working groups
that report to the Food and Beverage Taskforce. The
working group’s outcomes and work programme priorities
are outlined below:
OUTCOMES SOUGHT
• Current and prospective employees view the sector as a career destination of choice.
• Employers are able to attract sufficient numbers of suitably skilled and motivated employees to meet labour
supply needs of an expanding and diversifying sector.
• Employers and employees are able to innovate in the sector and achieve high performing labour and skills
sytems.
WORK PROGRAMME
Priority 1: Better Labour Market Information
• Forcasting framework, productivity study, science and technology adoption research and skill shortage
assessments.
Priority 2: More Strategic Investment in Training
• Skills and training (workplace practices, community awareness, changing occupations, quality and relevance).
Priority 3: Attractive Careers
• High quality workplaces and careers opportunities
• Integration of PhD students into food and beverage companies
10

The Skills Working Group is co-chaired by the Group
Manager, Labour Market Knowledge and Engagement of
the Department of Labour, and The Secretary of the
New Zealand Council of Trade Unions.
This Skills Working Group report can be found on the
Department of Labour and New Zealand Trade and
Enterprise websites. A separate background document
will also be available at these locations that contains a
selection of papers that were used to inform this report.
Scope
The food and beverage sector is commonly defined as
all parts of the value chain from on-farm (paddock) to
customer (plate). However, most of the effort for this
engagement has concentrated on primary production and
manufacturing/processing components of the value chain.
This has meant a focus on certain food and beverage subsectors
as defined in Appendix 1: Australia and New Zealand
Standard Industrial Classification.
Related Work Underway
A considerable amount of skills, training and labour market
related work has already been undertaken, that is relevant
to the food and beverage sector. The Skills Working Group
acknowledges and supports this work.
Food and Beverage Specific Work Underway
Some examples of food and beverage specific work
include:
• The Human Capability and Agriculture and Horticulture
Group – developing a schools’ curriculum strategy
with goals to increase the profile of the sector,
change schools’ perception of the sector, increase
the number of people seeking careers in the sector
(eg. more science students) and introduce resources
across the curriculum.
• Department of Labour sector engagements
(particularly Tourism and Horticulture and Viticulture)
- refer to Transferring Learnings across the Primary
Primary
Producer
Food and
Beverage
Manufacturing
Food and
Beverage
Wholesalling
Food and
Beverage
Retailer
Consumer/
Customer
Food Service
import
export
World Market
11

Sector section of this report, where an example of
sector learnings has been outlined in relation to the
Horticulture and Viticulture Seasonal Labour Strategy.
• Skill Needs and Worker Voice in High Performance
Workplaces – this will look at the skills needed in New
Zealand’s high-tech dairy manufacturing industry;
identify skills dairy manufacturing workers need, and
what determines whether they learn those skills or
not. Fonterra, the New Zealand Dairy Workers Union,
and the New Zealand Industry Training Organisation
(which covers the dairy industry), will participate in
this study.
• Specific ITO related initiatives such as Farmsafe
(ie. training and extension services to farmers),
where the Agriculture Industry Training Organisation
(AGITO) works collaboratively with Agriculture New
Zealand and Telford Rural Polytechnic to develop an
effective programme to change behaviour on the
farm regarding workplace safety.
• Competitive Manufacturing (CMI) – a consortia of
organisations are supporting the development of
changes in the workplace to increase productivity.
It includes a NQF qualification already available at
level 2-4 and the development of a Diploma for 2007.
• Dairy InSight’s campaign to attract new entrants to
the dairy industry.
• The Department of Labour’s Foundation Skills in
Seasonal Workplaces – this includes a foundation
skills and task needs analysis (in the horticulture
and viticulture seasonal industries), with a view to
understanding foundation skills needs, the type
of foundation learning programmes that could be
potentially implemented, and the perceived benefits
and opportunities that these programmes offer for
improving workforce productivity.
Other Work Underway
Skills, training and labour market work already underway
(or completed) and relevant to food and beverage
businesses, includes:
• Tertiary reforms.
• Upskilling the Workforce – there may be flow-on
effects of foundation skills initiatives for food and
beverage employees that need foundation skills .
• Adult Literacy and Life Skill Survey – an OECD survey
that New Zealand is participating in that will measure
numeracy and problem solving skills 1 .
• Workplace Productivity Agenda – involving
implementation across the areas of: awareness
raising; development of diagnostic tools;
implementation and research; and evaluation. In
addition the Department of Labour, Ministry of
Economic Development and Ministry of Research
Science and Technology are leading work around
each of the seven drivers of workplace productivity,
as defined in the Workplace Productivity Agenda,
to improve productivity of small to medium sized
enterprises, including those in the food and beverage
sector.
• Helping Advance Nga Mahi in Growth and Innovation
(H.A.N.G.I Project). The New Zealand Council of
Trade Unions in conjunction with Hui Taumata has
established the project to focus on workplace
productivity education and training for Maori workers.
The vision is to increase the number of Ngä Kaimahi
Maori who engage in workplace learning with the
support of the unions, enterprises, industry and iwi.
• New Zealand Council of Trade Unions initiatives in
learning, productivity, improving wages and conditions
and Maori economic development.
1. Foundation skills are defined as including reading, writing, numeracy,
Information Communication Technology, problem solving, oral communications
and interpersonal skills.
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Transferring Learnings across the Primary Sector
The development and implementation of the Horticulture and Viticulture Seasonal Labour Strategy provides some
learnings that are relevant to the food and beverage sector and the Skills Action Plan, as illustrated in the example below.
Horticulture and Viticulture Seasonal Labour Strategy
The strategy has five objectives for implementation which correspond with the priorities identified by the food and
beverage Skills Working Group:
• Objectives addressing labour supply
• Objective 1: Providing seasonal work opportunities for New Zealanders
• Objective 2: Accessing global labour
• Objective 3: Information for Informed Management of Seasonal Labour
• Objectives addressing the management of labour
• Objective 4: Developing skilled workers
• Objective 5: Improving workplace quality and productivity
In implementing the strategy, the governance group of industry and agencies has amalgamated objective four
and five so that there are four sub-groups.
Objective three is critical for the strategy. Horticulture New Zealand, Ministry of Agriculture and Forestry (MAF),
Department of Labour and the Ministry of Social Development (MSD) are working on a forecasting tool that was
initially developed by BERL last year. The tool uses labour ratios and production data to estimate demand, but there
is very little helpful data available on supply.
This is particularly difficult in this sector because of the large number of illegal workers, and the seasonality of
the work which means census data may not be fully representative. Sub-group three has a project to adjust the
ratios used and check the production data region by region with industry. It will develop a means of estimating
labour supply sources and numbers. The latter will require creative research techniques and the active cooperation
of industry. Without sound numbers, the MSD and the Department of Labour have difficulty in recommending
immigration or Work and Income responses, and the governance group will not be able to influence the allocation of
education and training resource.
Developing a productive and skilled workforce is the solution needed for the annual crisis in grapes, apples and
kiwifruit industries. The fewer the numbers needed to work, the greater the chance that they can be effectively
allocated, paid well and have better career prospects. Moving to a situation with fewer more productive, and better
paid workers (current turnover approx. 300% a season) will assist in improving grower returns.
13

This requires a national means of easing allocation problems; hence the development of a “harvest trail” under
the strategy, and the establishment of a national system of seasonal coordinators. This has already assisted in
attracting workers to the areas of need. Training schemes are being developed in Bay of Plenty for managers,
picking staff in Hawkes Bay and for contractor employers in Marlborough.
Sub-group four is coordinating and encouraging these developments. Conversations with regional offices of the
TEC and polytechnics are beginning. First steps are also being directed at basic compliance issues. The work takes
time, and requires national and regional effort.
The systems to manage this work need further development. This includes generating a response from government
and industry, but at a regional and national level the resources and relationships needed to bring about change are
yet to be generated.
14

FOOD AND BEVERAGE EMPLOYMENT
Background
Recent New Zealand economic growth (across all sectors)
has been driven by rising employment, with 260,000 more
people entering the workforce over the past five years.
While the numbers of people entering the workforce have
increased, labour force growth has been in decline. This
means that industries are now struggling to recruit skilled
staff and the international market for adequately qualified
staff and skilled staff is increasingly competitive.
New Zealand currently has the highest skill shortages
in more than 30 years. Some of these shortages are
apparent within the food and beverage sector (eg. chefs,
bakers and food technologists).
Over the next 15 years, key factors that will impact the
food and beverage sector, (and other sectors of the
economy) include:
• Movement of significant population cohorts (baby
blip and baby boomers) into, through and out of the
workforce.
• Continuing globalisation, both the movement of work
and workers internationally.
• Changing skill requirements and the need to address
the educational underachievement of many New
Zealanders (particularly Maori and Pacific Islands
people).
• The evolving nature of work, including a greater variety
of employment arrangements, management styles and
workplace cultures and a more diverse workforce.
• The accelerating pace of technological change
and innovation and the impact this will have on the
structure of industries and occupations.
• Changing aspirations, including relative value placed
on work, family, and community commitments.
• Consumers demanding healthy and in some cases
more sophisticated products, which requires an
appropriately skilled workforce to deliver such
products.
The food and beverage sector needs to start now to
research, design and implement initiatives that will be
needed to ensure that New Zealand is well placed to
capitalise on labour market opportunities now and in
the future.
15

CURRENT LABOUR MARKET AND
EMPLOYMENT OUTCOMES
high participation for some skill shortages
low productivity
variable sector and regional performance
action by businesses
and individuals
major change projects
aligning activities and
programmes
A HIGH-PERFORMING LABOUR MARKET
high participation for all who seek it
globally-skilled workforce
high productivity
high-performing sectors and regions
Figure 1: Transformation Theme. Source: Better Work, Working Better, Department of Labour.
TRANSFORMATION THEME
In order for the food and beverage sector to grow and
transform (towards a high skill, high wage, high value
economy), a major shift will need to occur in several parts
of the labour market (ie. increased productivity, including
capacity to innovate through science and technology,
reduced skill shortages and increased participation
for those seeking to join the labour force but who are
currently under-represented), as indicated in figure 1.
The combination of these factors will change the way we
manage and organise work in the future.
The food service sector is the single largest employer
in the food industry, followed closely by the food and
beverage manufacturing and food retail sectors.
Of the approximately 337,020 people employed in food
and beverage, approximately 25% are involved in primary
production, 20% in processing and manufacturing, 30%
in wholesaling and retailing and 25% in the food service.
Food and Beverage Employment by Sub-sector:
A transformation will only be achieved through the efforts
of industry and business organisations, unions and other
organisations such as education and training providers.
Government has a role in supporting and facilitating
change at the individual business, regional, sector and
national levels.
Key Facts about the Food and
Beverage Sector
The food and beverage sector is a major contributor to
the New Zealand economy. In terms of export earnings,
the sector recorded $15.4 billion in 2004 compared to $9.3
billion in 1994, representing an annual compound growth
rate of 5.2% during this period.
In 2005, approximately, one in ten people worked in the
sector and it employed 20% of the working population.
16

The food and beverage share of New Zealand employment:
Source: Statistics New Zealand Population Estimates March 31 2005. Statistics New
Zealand Business Demographics February 2005 (wage and salary earners only).
Some key statistics relating to the food and beverage workforce
are outlined below:
• Wages appear to be relatively low in the primary food sector.
MEDIAN HOURLY EARNINGS BY INDUSTRY, 2004
Source: Household Labour Force Survey – Income Supplement June Quarter 2004 (wage and salary earners only).
17

• A large portion of food and beverage employees have
no or low qualifications (especially in food processing
and fishing). This should be balanced with the fact that
some occupations may not require a high
level qualification.
QUALIFICATIONS OF FOOD PRODUCTION OCCUPATIONAL GROUPS
Source: Statistics New Zealand Census 2001.
18

• Large number of health and safety issues (especially in
meat processing and livestock farming). Over the past
two years health and safety costs have been declining.
FOOD AND BEVERAGE ENTITLEMENT CLAIM NUMBERS
Source: Accident Compensation Corporation
19

• Long hours in some parts of farming (ie. Dairy Farmer,
Worker and Sheep Farmer, Worker) and fishing
(ie. Fishing Skipper and Fisherperson), compared
with hours for other parts of food and beverage.
PERCENTAGE OF SELECT FOOD OCCUPATIONS WORKING 50 OR MORE HOURS PER WEEK, MARCH 2001
Source: Statistics New Zealand Census 2001.
20

• An aging population in most food and beverage sub
sectors with approximately 45% of those in farming
and fruit and crop growing aged 45 years or older in
2001. This compares with 35% of the total workforce.
• Food and beverage consumers are now better
educated about the benefits of healthy food, impacting
on the types of skills needed in the food and beverage
workforce.
• Employment locations in the food and beverage sector
in 2003 are more evenly dispersed relative to the
manufacturing industry and the economy. The food and
beverage sector has less concentration in the three
main centres of New Zealand. Only 45.1% of FTEs work
in one of the three main centres compared to 58.9%
for the manufacturing industry and 60.7% for the
economy as a whole. Food and beverage FTEs are also
much higher in Otago and Southland than either the
manufacturing industry or the economy as a whole 2 .
Anecdotal evidence suggests that:
• On average total jobs filled in food and beverage are
significantly seasonal in nature compared with non food
and beverage jobs.
• Food and beverage worker turnover rate is higher than
for non food and beverage industries.
• There is significant dependence on immigrants with
short term work permits especially in the seasonal
businesses (eg. fruit picking).
• Growing need for ‘top talent’ that can add value to
existing product ranges and technology advances and
fulfil challenging new roles most of which are related
to food health, science, technology and research.
• Increasing need for employers and employees to
maximise productivity gains by adopting new technology
(capital investment) and to complement this with
improvements in labour productivity and multi-factor
productivity (ie. the amount of output produced in
relation to inputs of both capital and labour).
• There is a general perception that food and beverage
careers are not attractive, therefore effecting
recruitment and retention and creating skills shortages
in some key occupations.
2. “Food and Beverage Sector Taskforce (2005) “Discussion Paper on New Zealand’s Food
and Beverage Sector”, Wellington, New Zealand, ”.
21

SKILLS WORKING GROUP PRIORITIES
The following sections outline key labour market issues
under each of the three Skills Working Group priorities
- better labour market information, more strategic
investment in training and attractive careers.
1. Better Labour Market Information
The purpose of this priority is to ensure robust data and
information is available to enable sound decision making
about food and beverage skills, training, employment and
productivity issues. This priority includes improving the
information base by:
• Being able to forecast labour demand in sub sectors
within food and beverage.
• Better understanding of the link between productivity
and skills in food and beverage businesses.
• Better understanding of how to increase the adoption
of science and technology in food and beverage
businesses.
• Determining the extent of current skills shortages in
key food and beverage occupations.
Each of these components is explained in detail below.
1.1 FORECASTING FRAMEWORK
Action Points
• The food and beverage forecasting framework will
be implemented and applied to all food and beverage
sub-sectors and maintained on an ongoing basis.
This would involve food and beverage ITOs (as part of
their strategic skills leadership role) assisting in the
implementation of the framework in conjunction with
other relevant organisations.
• STAG will guide consistency of application of this
framework within the food and beverage sector,
improve the framework, and test its robustness
with respective industry organisations and training
organisations.
Background
A forecasting framework for the food and beverage sector
was considered necessary to process relevant and available
labour market information using appropriate modelling of
future labour and skills demand in the sector. A forecasting
framework has been developed by BERL (Business and
Economic Research Ltd) and tested on the dairy and wine
sub-sectors, which included industry consultation. This
framework is designed to be used by industry organisations
to assist in their workforce planning.
The numbers generated for the dairy and wine sub-sectors
are not forecasts, rather they provide an outlook for the
sub-sectors and are the result of specified scenarios
which demonstrate how the framework can function.
The framework is a starting point requiring further work,
industry ownership, data integrity and interpretation of
facts and trends that are identified as a result of ‘running
the numbers’. The interpretation is necessary within a
strategic context that includes the impacts of ‘soft’
influencing factors on the flows of labour.
This framework will enable the food and beverage sector,
education and training organisations, industry associations
and government agencies to make better assessments
about future labour and skill needs in this sector and how
to address them. It may assist in education, training and
recruitment decisions and assist the taskforce in planning
its development agenda. There is a distinct need for
projections of the trends in the demand for labour over the
medium term in relation to future growth or changes in the
food and beverage sector.
The framework needs to be further tested with respect
to the assumptions (labour turnover, productivity, output
growth, extent of part-time work) used and integrity of the
data. It could then be extended to other food and beverage
sub-sectors. It will be critical to improve the information
used in the framework and data updates, including use
of the 2006 Census information on occupations and
qualifications within the food and beverage sector. In
implementing this framework, future population changes
22

Inputs
Outputs
Types of Decisions
• Benchmark historical
• Default scenario
• Recruitment
data (Census,
Business Directory,
(ie. Labour
requirements by
• Immigration
ITO data)
• Exogenous
production volume
forecasts (wine &
dairy industry)
Forecasting
Framework
Application
occupation and
qualifications)
• Alternate scenario 1
• Alternate scenario 2
• Tertiary education
and training
• Wages
• Career promotion
• Parameters (eg.
value added in the
production chain,
• Capital investment
and use of
technology
labour turnover,
labour productivity,
fulltime/part time)
• Stakeholder
interviews
(fertility and migration) and workforce changes (ie. greater
participation of women and older workers) will be taken into
consideration.
The forecasting framework developed for the food and
beverage sector has suggested an approach which utilises
available forecasts (of product output) and existing data
and parameters to derive future employment levels at
some level of detail. In that process, the need for more
up-to-date and consistent data has also been identified to
make the results (eg. occupations and qualifications) more
relevant.
The key components of the forecasting framework are
outlined above.
The inclusion of labour turnover allows for an assessment
of replacement demand of the existing workers in each
value-chain to be estimated along with the additional
derived demand for labour as a result of output changes.
The share of occupations in each value chain and the
qualifications of those employed are based on the 2001
census results and have been maintained at this level over
the forecast period (2006-10). These can be updated when
the 2006 census results on occupations and qualifications
shares in food and beverage sub-sectors and value chains
are made available by Statistics New Zealand (SNZ).
APPLICATION OF THE FORECASTING
FRAMEWORK
Overview of Results
Comparisons of recent (2000-05) changes in employee
counts and full-time equivalent employment in the food
and beverage sector, in comparison to the overall labour
market are summarised below:
23

• Over the five year period (2000-05), excluding
agriculture, the employee count in food and beverage
has grown by 23% compared to 17% for the whole of
New Zealand over the same period.
• Over the last ten years (1995-2005), total food and
beverage employment by full-time equivalents (FTEs)
increased by 8% (including all agriculture) compared to
total New Zealand FTEs which increased by 22% (SNZ
and BERL calculations);
• The food and beverage value chains with the
highest employee count in 2005 were food service,
manufacturing and retailing, with lower number of
employees in marine fishing, horticulture and food
wholesaling.
• Between 1995 and 2005, the share of FTEs in
agricultural production activities declined from 40%
to 33% of total food and beverage employment. The
food service share increased from 16% in 1995 to over
20% in 2005 while the manufacturing share remained
relatively unchanged at about 20% and the retailing
activity share at about 15% over the 1995 to 2005
period. The wholesaling share rose very slightly from
6% to 8%.
An example of how the framework can be applied in the
form of the value chain is outlined below:
The Food Industry Model developed in the Coriolis report
shows that the food industry begins with natural resources
and ends with sales to domestic consumers or to export
markets.
The applicability of employment data depends on how
well the data can be applied to the value chains of the
various sub-sectors. As a test BERL have incorporated
employee count data into the Coriolis Food Industry
Model (see below).
CORIOLIS FOOD INDUSTRY MODEL WITH EMPLOYEE COUNT
RESOURCES PRODUCTION MANUFACTURING & WHOLESALE
Meat processing 30,440
Livestock 30,580
Pasture 50,890
Meat wholesaling 1,920
Milk 20,310
Dairy processing 9,650
Dairy wholesaling 1,250
RETAIL &
FOOD SERVICE
Farm
equipment,
supplies,
genetics,
etc
Arable land and
horticulture 26,340
Grains 490
Fruit & vege 25,850
Grain-based manufacturing 8,870
Grain-based wholesaling 350
Fruit & vegetable processing 5,600
Fruit & vegetable wholesaling 3,410
Beverage manufacturing 6,010
158,270
Beverage wholesaling 2,740
Seafood 2,190
Fish & other
seafood 2,190
Seafood processing 5,980
Seafood wholesaling 560
Primary
Food imports
Other food processing 7,410
Other food wholesaling 15,110
Support
functions
Education, Recruiting & Human Resources; Logistics and Distribution; Market Research, Advertising and Design,
Research and Development, Information Systems; Packaging; Finance, Banking and Insurance.
Source: Model adapted from Coriolis, Employment Data from Statistics New Zealand
24

Examples of Sub-sector Outlook for Dairy and Wine
The comparisons include outlook results (2005-10) of
overall employment in the dairy and wine sub-sectors under
the “default” scenario in relation to recent developments
(2001-05) in these sub-sectors. This is followed by
observations on the occupations and qualifications share
of employment in each of the value chain 3 activities for
dairy and wine sub-sectors based on the 2001 Census.
The overall employment results, are also provided, taking
into account replacement demand (under the default
and an alternate lower turnover scenario), the impact of
higher output (ie. milk solids and wine grapes) and lower
productivity scenarios on dairy and wine sub-sector
employment.
Employment: Sub-Sector Totals and by Value-Chain
• Total employment in the dairy sub-sector rose by fewer
than 5,000 FTEs (or by 9%) between 2001 and 2005 and
this is forecast to grow by about 3,750 FTEs (or by 7%)
over the 2005 to 2010 period. Wine sub-sector total
employment grew by about 3,500 FTEs (or 28%) over
the recent period (2001-05) but is forecast to grow
only by about 2,100 (or by 14%) over the forecast period
(2005-10).
• During (2001-05), the greatest increase in dairy
sub-sector employment was in the processing/
manufacturing (22%) and the retail service (15%) value
chain activities. Over the forecast period (2005-10),
the increase in processing/manufacturing employment
is expected to rise by only 9% while retail and retail
service employment is expected to rise by about 15%.
• During (2001-05), the greatest increase in wine subsector
employment was in production (about 50%),
followed by wine making (18%) and wholesaling (24%)
value chain activities. Over the forecast period (2005-
10), the increase in employment in production activities
was considerably less (under 10%) and the rise in
employment in all other value chain activities was in
the range of 12-18%.
• In the dairy sub-sector, activities at the paddock or
farm level account for over 60% of the employment
followed by processing (18%) and retail and retail
services (7-8%). In the wine sub-sector, activities at
the vineyard level account for only about 30% of the
employment closely followed by retail (29%), retail
services (24%) and processing (15%).
3. BERL have used the following components of the value chain; paddock, process, wholesale,
retail and retail service.
25

Occupations by Value-Chain Activities
In terms of occupations by value chain activities, dairy
farmer/farm worker and grape grower/wine maker
accounted for over 60% of the production related
occupations. In the case of processing activities, about
50% of the occupations in the dairy sector were in the
“other” category and hence specific occupations were
undifferentiated. This “other” category accounted for
just under 30% in the case of wine processing.
• In the wholesale value chain, administration and
management related occupations accounted for about
20% in dairy and were over 30% in wine wholesaling.
Technicians and associate professionals made up about
15% of the occupations in dairy and 17% in wine, while
service and sales workers in wholesaling accounted
for about 11% in dairy and 14% in wine. Professional
occupations in dairy had a 14% share, however the
number of professionals was not separately identified
in the case of the wine industry.
• In the retail and retail service value chain, service and
sales staff accounted for about 40% and 60% of the
occupations, respectively in the case of dairy and wine.
Administrative and managerial positions represented
about 15% and 20% of the occupations in retail and
retail services, respectively, in the case of both dairy
and wine sub-sectors.
Qualifications breakdown for sub-sectors
• Based on the 2001 Census, over 28% of the dairy
sub-sector and about 22% of the wine sub-sector
workers had no qualifications while over 40% of the
dairy sub-sector and almost 50% of the wine subsector
workers had high school qualifications. However,
qualifications are not always necessary for some
occupations.
• About 20% of the dairy sub-sector workers and 15%
of the wine sub-sector workers possessed either basic
vocational or advanced vocational qualifications while
about 6% of the dairy and 9% of the wine sub-sector
workers had a bachelors or higher degree according to
the 2001 Census.
1.2 Productivity
Action Points
• Complete the productivity study currently underway,
which will identify productivity issues specific to food
processing businesses.
• The New Zealand Council of Trade Unions will use
the findings of the productivity study to inform the
Workplace Productivity Education Programme and in
developing resources for union delegates and future
productivity initiatives.
• A first phase of science and technology adoption
research has been completed. The findings will be
taken forward with industry and relevant agencies.
Background
Although all sectors of the New Zealand economy have
been enjoying an increased level of productivity growth
in recent years, the country’s productivity measured in
absolute terms still lags behind the OECD average.
The graph (next page) illustrates the differences in labour
productivity between OECD countries based on GDP
per hour worked across all sectors of the economy.
It illustrates that New Zealand is also below the OECD
average for labour productivity.
26

AVERAGE ANNUAL GROWTH IN PERCENTAGE, 2002-2004 OR LATEST PERIOD AVAILABLE
Source: Organisation for Economic Cooperation and Development (2005). ”International Comparisons of
labour productivity levels – estimates for 2004, September 2005,” – OECD estimates. Paris, France.
Over the past decade, New Zealand’s economic growth has
been driven by a significant increase in hours worked and
the volume of human capital in work. David Skilling from the
New Zealand Institute outlines the downside of the picture:
“…..Labour force growth accounted for about two thirds
of New Zealand’s growth over the past fifteen years,
with labour productivity accounting for just one third.
Labour productivity over this period grew at just 1.0%
a year, which is in the bottom quartile of performance
across the OECD.
The Treasury provided an analysis that examined
productivity performance of the primary, and food,
beverage and tobacco and manufacturing (FBTM)
industries. It indicated that output and labour productivity
growth in the primary and FBTM industries has been
strong, as illustrated over the page (total manufacturing
is included for comparison). Some of this growth could be
attributable to factors such as increased intensity of food
and beverage production practices.
…..New Zealand’s labour productivity, in terms of output
per hour worked, is just 79% of the OECD average. New
Zealand’s hour worked per capita on the other hand
stands at 113% of the OECD average.” 4
4. The New Zealand Economy: The Next 20 Years. 4 March 2006.
27

LABOUR PRODUCTIVITY
Source: A Treasury presentation to the Skills Working Group in March 2006
New Zealand now has more people working but for longer
hours than most other OECD countries - 21% of New
Zealanders work 50 or more hours per week, second to
Japan at 28%. Working smarter, investing in capital and
moving higher up the value chain is a more sustainable way
of increasing GDP than increasing hours of work.
In order to improve productivity, the Workplace Productivity
Working Group identified seven drivers in 2004 (listed
below) that can assist with improving productivity, each of
which is explained in more detail online:
http://www.dol.govt.nz/workplaceproductivity/
• Building better leadership and management
• Organising work
• Networking and collaborating
• Investing in people and their skills
• Encouraging innovation and using technology
• Creating productive workplace cultures, and
• Measuring what matters.
Business and employer groups, unions and government
are working together to help lift workplace productivity
in New Zealand through implementation of the Workplace
Productivity Agenda. To assist in this process (from a
food and beverage point of view) a productivity study has
been commissioned (part ‘a’ below) and research has been
commissioned into science and technology adoption in the
food and beverage sector (part b).
A. PRODUCTIVITY STUDY
The study on productivity in the food and beverage sector
is intended to:
• Assess the current state of productivity specific
to food processing businesses (ie. confectionery and
snack food sector) within the food and beverage
sector utilising the framework provided by the
28

Workplace Productivity Working Group (ie. the seven
drivers of workplace productivity). This industry has
characteristics that will enable the research findings
to be generalised across manufacturing/processing
parts of the food and beverage sector.
• Provide suggestions on how productivity in the sector
could be improved and how government, training
organisations and sector groups can better assist
workplaces to improve their productivity.
• Identify what workplace practices are working well and
conversely not so well in the confectionery and snack
food sector.
• Identify impediments to lifting productivity
performance of businesses in the confectionery and
snack food sector.
• Provide methodological insight to inform future
research.
Early observations from the Deloitte team undertaking the
study, indicate that investment in production technology
has a discernable correlation with:
• The requirement for upskilling and commensurate
investment in people and human resource programmes.
• The organisation’s ability to compete in more than
just national niche markets and therefore to achieve
real production and productivity growth.
Investment in infrastructure and technology often
prompts investment in upskilling. Alternatively, it is also
known that investments in upskilling can drive increased
investments in technology to complement a new skill set.
Within the confectionery and snack food sector there
is a proven ability to innovate with some very successful
high value niche products being developed by both large
and small organisations. This sub sector has a strong
entrepreneurial spirit and a flexible workforce able to
be deployed in a manner that supports highly productive
organisations.
Issues that impact on the confectionery and snack
food sector’s ability to be productive include:
• The need for more effective deployment of support
mechanisms for New Zealand owned organisations to
achieve increased productivity through export growth.
• Market drive to invest in machinery, technology and
innovation, leading to training for higher level skill needs
and ultimately to higher productivity performance.
• A shift from applying the seven drivers of productivity
to reduce costs per unit of production, to applying the
seven drivers to create an environment that supports
successful research and innovation, therefore calling
on a more significant investment in skills.
• The need to focus on developing specific technological
expertise that could advance the confectionery and
snack food sector.
• The need to develop catalysts and sustained support
to improve networking and collaboration in the sector.
• Access to affordable capital.
B. SCIENCE AND TECHNOLOGY ADOPTION
The Skills Working Group, in collaboration with the
Innovation Working Group, identified the need to conduct
a research study to better understand constraints to
science and technology adoption (focusing on the attitudes,
skills and behaviours of owners, managers and staff). The
study investigated how more active interactions across
the supply and value chains could be encouraged to
increase adoptive capacity: Why it is that some companies
adopt science and technology innovations and others, who
know about their potential benefits, choose not to?
The vegetable and savoury foods sub-sector was selected
for this research because of this sub-sector’s potential
for sustainable growth (i.e. the convergence between
market demand for healthier, stylish and convenient foods
29

and science and technology’s ability to provide solutions
‘palatable’ to a wide range of consumers).
Increasing demand for vegetable-based foods that
combine health, style and convenience can best be
met by growers and processors developing skills and
networks to make use of science, technology, marketing
and organisational innovations. These innovations are in
relation to growing produce; environmental management;
understanding emerging market demand; adding value
in processing, storage and packaging; and enabling more
efficient distribution to maintain freshness, goodness,
flavour and appearance.
A two-phase approach to the research has been adopted.
Phase one has been completed with findings outlined below.
The first phase aimed to help stakeholders understand
and be able to take action to improve adoption rates.
In the first instance it is exploring the range of attitudes,
behaviours, skills, relationships, and networks that decision
makers and ‘ground floor’ staff need in order to assess:
• The potential of an innovation.
• The nature of the change process that would be
involved in adopting it.
• The requirements for successful implementation.
It also sought to understand the impact that the presence
or absence of highly qualified staff or PhD students has on
assessment, change management and implementation. The
research looked at the impact of organisational culture
and organisational practices on openness to adoption, and
adoption rates.
Key findings from phase one are:
• There appear to be three primary drivers as to
how open or otherwise businesses are to adopting
science and technology. The most significant is the
focus on survival, either through increasing efficiency
or matching competitors’ products. The second is
that lack of scale means using cash flow rather than
debt/equity to fund improvements, which biases
investment towards incrementalism rather than
disruptive innovations. The third is the impact of the
characteristics of the owner or manager – the higher
their levels of confidence and vision to take risks, and
analytical skills and education, the more likely it is they
will adopt science and technology.
• Secondary drivers include the:
• Speed with which investment decisions can be made.
• Style and structure of management.
• Level of in-house scientific and technical expertise;
where high transaction costs with sourcing seasonal
staff lead to technology substitution for labour.
• Difficulties to do with the availability and suitability
of labour where it has been a factor in decisions
to increase levels of automation so as to reduce
reliance on labour. This is in part to do with the
seasonal nature of the industry, especially in growing
where there is no guarantee that next year’s labour
pool will be the same as last year’s, leading to
significant transaction costs.
• At the commodity growing and processing end of
the vegetable industry value chain, there are well
established systems, processes and networks
supporting the adoption of technology for survival
(for now).
• Few companies are targeting niche local and export
markets with high quality and differentiated products,
where science and technology adoption (innovation)
are critical success factors, and the real returns lie.
This appears to relate to there being no apparent
modus operandi or development pathway available for
new products and for creating the value chain needed
to get them to market successfully. Furthermore,
large scale science and technology adoption, to drive
economic transformation, requires the industry as
a whole to develop the willingness and capability to
30

• Promoting ‘good practice’ within Crown Research
Institutes as to how scientists and business work
together to solve real problems within particular
business contexts.
Phase two will involve progressing these findings from
phase one with relevant industry and government agencies.
1.3 Skill Shortages
Action Points
collaborate to create a New Zealand Incorporatedscale
new value stream.
There are however, opportunities to improve the system
to better facilitate science and technology adoption.
A number of suggested improvements for both industry
and government to consider are:
• Improving availability and accessibility (perhaps through
pooling) to key technical skills (eg. engineering process
design, food technology).
• Creating a service for the collection and dissemination
of pragmatic and up-to-date free market intelligence
in the vegetable and savoury food sub-sector to be
accessed through a single portal.
• Provision of brokerage skills to connect generators
and users of technology and science.
• Actively identifying and developing opportunities to
achieve higher levels of collaboration, especially in
export markets.
• Information has been gathered for the Skills Working
Group on genuine skill shortages and recruitment
and retention difficulties for bakers, butchers, chefs,
dairy farmers and dairy farm workers, and food
technologists. Appendix two outlines ways to address
these issues. The Skills Working Group will consider how
best to promote these solutions.
• Efforts will continue to improve the quality of labour
market information about skill shortages in the
food and beverage sector to better inform tertiary
education and training strategies and priorities.
Background
Skill shortages can indicate a healthy, dynamic economy
creating new jobs and expanding existing jobs at a fast
pace. However, shortages may also be imposing a cost on
the economy, by constraining the outputs of a business.
The education and training system is crucial to raise skill
levels and adjust the skills required to match the current
and future workforce. To attract and retain a highly skilled
workforce, businesses need to offer appropriate wages
and fund appropriate levels of training, introduce worklife
/flexible work practices and address recruitment and
retention difficulties.
It is important that tertiary education and training
investment and strategic decisions factor in the need to
address skill shortages in the food and beverage sector.
31

There are different types of skill shortages 5 and the
causes are varied, as are possible solutions relevant to
each sub sector within the wider food and beverage sector.
The Skills Working Group selected a few occupations for
which there was either statistical or anecdotal evidence of
current skill shortages likely to have an impact on future
growth of the sector.
Selected occupations included: baker, butcher, chef, food
technologist, dairy farmer/dairy farm worker, electrician,
fitter and turner, production manager, sales/marketing
manager. Some of these occupations are generic (i.e.
production manager, sales/marketing manager, fitter and
turner and electrician) and some are specific to food and
beverage (i.e. chef, dairy farmer/farm worker, baker and
butcher). Food technologists are one of several closely
related occupations that are subsumed under the broad
occupational grouping ‘Chemical Engineer’.
The approach used to analyse these occupations is based
on the Department of Labour framework for analysing
skill shortages in New Zealand. This framework is explained
below and considers demand (or opportunities); supply
(or capacity) and the balance between them.
Industry growth
Changing use of occupations
by industry
DEMAND/OPPORTUNITIES
DEMAND FOR OCCUPATION
Balance between demand and
supply is measured by:
• Fill rate
• Advertised vacancy growth
• Wage trends
BALANCE
SUPPLY OF OCCUPATION
• Imbalance = shortage
• Shortage may be a genuine
skill shortage
• Or retention/recruitment
difficulty
MIGRATION
Members of the occupation
leave and enter NZ.
OCCUPATIONAL DETACHMENT
Members of the occupation
leave and re-enter the
occupation.
RETIREMENT
Members of the occupation
retire.
SUPPLY/CAPACITY
5. There are two types of skill shortage: 1) Genuine skill shortage - when employers have difficulties filling job vacancies because there are not enough individuals with the required skills
in the potential labour market to fill the positions on offer; and 2) Recruitment and retention difficulty - when there is a considerable supply of individuals with the required skills in
the potential labour market, but they are unwilling to take up employment at current levels of remuneration and conditions of employment.
32

A summary table below outlines some key shortage
indicators for each occupation, as well as the skill shortage
assessment for each occupation:
• Both genuine skill shortages and recruitment and
retention difficulties clearly affect the following
occupations namely: baker, butcher, chef, dairy farmer/
dairy farm worker, and possibly also impact on food
technologists.
• Electrician and fitter and turner both suffer from a
genuine skill shortage and sales marketing manager
probably also face such a shortage.
• Production manager 6 is probably not suffering from
skill shortages, although this does not preclude
shortages existing in specific niche manufacturing
industries.
There are a variety of ways to address skill shortages
(ie. enticing expatriates back home, immigration, attracting
people from similar/related occupations, substitution with
technology and/or up-skilling the existing workforce). Other
sources include providing incentives for older people to
work for longer (before retiring), incentives for non-working
parents to re-enter the workforce earlier, and incentives
to attract non-traditional workers to occupations (eg.
women to become fitters and turners).
While skill shortages can be addressed through
means identified above, there is a need for integrated
conversations between training providers, unions,
employers and government agencies.
A summary of potential ways to address skill shortages
for each selected occupation is outlined in Appendix 2.
The potential solutions are specific applications of priority
two and three approaches.
The following table 1 summarises the results of the skill
shortage indicators and assessments for each occupation.
Appendix 3 contains an explanation of terms and sources
used in the development of this information.
Table 2 contains demographic and qualification related
information about each selected occupation.
6. It should be noted that there are many terms used for production manager such as
site, plant, logistics or procurement manager, hence it is possible that not all data
relating to production manager has been captured. Also note that anecdotal evidence
suggests most production managers come about through promotion rather than by
acquiring a relevant qualification. This is an example of where industry training levels
may need to be increased above level four.
33

TABLE 1: SKILL SHORTAGE ASSESSMENTS
The following table summarises skill shortage indicators and assessments for each occupation (also refer to Appendix 3
for an explanation of terms used and more detailed statistics and source information).
Occupation Fill rate Training
rate
Retirement
rate
Vacancy
growth rate
Wage rate
Genuine skill
shortage
Recruitment &
retention difficulty
Production Manager - - 0.9% -36% $39.87 Probably not Probably not
Sales/Marketing Manager - - 0.6% 7% $52.06 Probably Probably not
Food Technologist - - 0.9% 37% $28.56 Possibly Possibly
Chef 51% 4.1% 0.3% 14% $15.18 Yes Yes
Dairy Farmer/
Dairy Farm worker - - 1.7% 17% $18.07 Yes Yes
Electrician 30% 2.6% 1.1% -10% $23.89 Yes No
Fitter & Turner 27% 3.0% 1.5% 3% $22.86 Yes No
Butcher 62% 1.9% 1.0% 38% $16.12 Yes Yes
Baker 37% 1.2% 0.6% 24% $17.07 Yes Yes
TABLE 2: DEMOGRAPHIC AND QUALIFICATION DATA PER SELECTED OCCUPATION
Source: Statistics New Zealand 2001 Census
Occupation Male Female
(%) (%)
Non-
Pakeha
(%)
Age
(15-29)
Age
(30-49)
Age
(50+)
School
(%)
Post
School
(%)
Degree or
Higher (%)
>50hrs
per week
Production Manager 86 14 13 13 64 23 54 34 13 46
Sales/Marketing Manager 67 33 9 18 64 17 54 24 22 42
Chemical Engineer 67 33 17 26 55 19 23 25 51 20
Chef 64 36 34 50 43 7 58 39 3 24
Dairy Farmer/Dairy Farm Worker 66 34 6 22 54 25 74 22 4 64
Electrician 99 1 10 25 53 22 24 75 1 22
Fitter & Turner 100 0 11 20 56 25 41 58 1 24
Butcher 96 4 25 34 43 23 70 29 1 28
Baker 70 30 34 42 45 13 78 20 2 22
34

Based on the above census data, the following information
about each of the selected occupations has been identified:
• Bakers and chefs reflect a distinctly different age
distribution of their workforces compared to other
selected occupations. These hospitality occupations
are heavily weighted in the young to middle aged
category and lightly weighted in the old-aged category.
• Training, work experience and attitude count for more
than educational qualifications for occupations such
as baker, butcher, chef, dairy farmer/dairy farm worker,
electrician and fitter and turner. Very few of them
possess a degree. Although 51% of chemical engineers
possess a degree, followed by sales/marketing manager
(22%) and production manager (13%).
• Eight of the nine occupations are male dominated, with
fitter and turner showing 100% male, followed closely
behind by electrician (99%) and butcher (96%);. The
exception is food technologist where the survey shows
that 63% of the workforce is female.
• The ethnic group composition for all nine occupations is
predominately pakeha. However, 34% of both chefs and
34% of bakers are non-pakeha.
• In terms of hours, dairy farmer/workers work long
hours with 64% working more than 50 hours per week,
followed by production manager (46%) and sales/
marketing manager (42%).
• All the occupations except chef are insignificant users
of work permit holders. For chefs, 21.9% of their
workforce have work permits.
35

2. More Strategic Investment in Training
This priority was designed to identify how skills and training
issues could be better addressed.
A process for tertiary education reform is underway which
will provide solutions to enhance the quality and relevance
of tertiary education provision. While this is a major
initiative over several years, it needs to be complemented
by sectoral work that more closely links education and
training provision with industry needs.
The Department of Labour and the TEC prepared
background material for two workshops. The first workshop
was with Agriculture Industry Training Organisation,
Competenz, Lincoln University, AgResearch, Horticulture
Industry Training Organisation, the TEC, the Department of
Labour and New Zealand Trade and Enterprise. The second
workshop was with the New Zealand Council of Trade
Unions, Business New Zealand, the Department of Labour,
and the New Zealand Beer, Wine and Spirits Council. This
work was complemented by discussion at the Skills Working
Group and the taskforce as well as analysis of the feedback
generated by the taskforce’s consultation process.
Background material for the workshops included:
• A draft report from the Tertiary Education Commission
called “Report to the Skills and Training workshop for
the Food and Beverage Skills Workshop Group” .
• A draft report from the Department of Labour
called “Draft Food and Beverage Skills Working group
- Discussion Paper”.
Common skills and training themes arising from the
workshops (and other sources), were:
• Workplace practices.
• Community awareness.
• Responding to changing occupations and skill needs.
• Quality and relevance.
The Skills Working Group has indicated that in order for
change to occur in food and beverage skills and training,
that collaboration of key players (incl. training providers)
is necessary. The STAG will facilitate this collaboration
and oversee implementation of issues identified below.
2.1 Workplace Practices
Action Points
• Promote and explore industry best practice and
incentives in relation to skills development.
• Increasing employee participation in training, and
support for the Council of Trade Unions’ Learning
Representatives Scheme.
Background
Employers, and employees and their representatives have
important roles to play in creating high quality, productive
workplaces which support access to appropriate
opportunities for skill development.
There is an opportunity to invest in knowledge building
about the future ongoing changes in the nature of work
for food and beverage companies, and the impact of
these changes on workplace practices for employers and
employees. The work to date has identified a pressing
need to share best practice within industry and promote
the value proposition of investing in skills development
for managers and staff.
2.2 Community Awareness
Action Points
• Develop learning resource materials for curriculum
in primary and secondary schools that reflect the
importance of the food and beverage sector as a major
employer and contributor to New Zealand’s economy.
36

• Promote careers to parents, youth, teachers and
careers advisors that reflects the reality of working
in the food and beverage sector (ie. how sophisticated
jobs are now).
• Support initiatives from the Human Capability Group
in Horticulture and Agriculture, which involves a
schools’ curriculum strategy with goals to increase
the profile of the sector, change schools’ perception
of the sector, increase the number of people seeking
careers in the sector (eg. more science students), and
introduce resources across the curriculum. In addition
and alignment with this work, encourage a coordinated
cross sectorial approach to career promotion in
schools.
Background
It is apparent that for education and training to be
taken up, there needs to be greater awareness of the
opportunities such occupations offer. This is an area in
common with priority three, “Attractive Careers”. The
focus of this area in priority two is the way the primary and
secondary parts of the education system communicate the
realities of working in the food and beverage sector.
2.3 Responding to Changing
Occupations and Skill Needs
Action Points
• Explore ways to improve the ability of the skills and
training system to adapt to rapidly changing and new
occupations.
• Increase support for initiatives that could be
undertaken by Learning Representatives and build on
current work with a group of ITOs to integrate literacy
training with industry training (eg. in seafood and
agriculture).
• Communication of the relationship between high levels
of foundation skills in food and beverage businesses
and favourable productivity results.
• Increase support and encouragement for the uptake
of relevant vocational qualifications (inclusive of higher
level qualifications) that provide a good match to
associated job opportunities.
• Continue and extend active support for alternative
employment (preferably in the food and beverage
sector) with tailored programmes for individual workers
and investment in education and training for employees
affected by business closures, downsizing and
relocations. This would involve working with employers,
unions, ITOs, other education providers and agencies of
government and local government.
Background
Due to the introduction of new technology (incl. upgrades),
integration of production processes, productivity
innovations and convergence with other sectors (eg. food
and health, food and hospitality), traditional occupations
and career paths are changing (ie. from low to high value
work). It is important that education and training reflects
these needs, for which employees are able to adapt existing
skills and develop new ones. It is also important that
employers provide a flexible work environment. Education
and training should not only be provided to those whose
jobs are changing but also to those whose jobs have
changed.
As with other industries, the food and beverage sector
has a spectrum of skills that range from top talent to
foundation level. Investment in foundation skills may be
just as important as investment in relevant vocational
qualifications and higher education.
There is usually a strong relationship between a
workforce’s foundation skills and the level of labour
productivity within a business, thus demonstrating the
need for employers and government to invest in foundation
skills. ITOs are currently piloting the integration of
foundation learning (work in progress) into industry training
and ensuring training and foundation learning is available to
low skilled workers.
37

While industry training is an appropriate avenue for delivery
of foundation skills in the workplace, there are issues
associated with the capability of the system to support its
integration. For example, this requires ITOs to undertake
additional/new work to identify specific foundation
needs, assess individuals’ needs, train existing trainers to
incorporate foundation learning, and assess gains made as
a result.
High proportions of food and beverage employees have no
or low qualifications, although this needs to be balanced
with the fact that some food and beverage occupations
do not require sophisticated skill bases. Given parts of the
food and beverage value chain are increasingly becoming
more sophisticated and consumers are demanding better
quality, there will be pressure on some food and beverage
occupations to deliver to a higher standard. This will
generally require a more developed skill base and capability
within the workforce.
Government will shortly consider proposals for how
employers will be engaged and learners motivated to
take part in the upskilling strategy, including a model
for developing demand and ensuring a balance with
the provision of training in the workplace, and specific
initiatives. It is possible that the proposed upskilling
initiatives could be reflected in the Skills Action Plan for
the food and beverage sector and the work by STAG,
following decisions by Government.
2.4 Quality and Relevance
Action Points
• The Skills Working Group recommend that in relation
to the tertiary reform process, that funding must be
linked to the new Tertiary Education Strategy and the
Statement of Tertiary Education Priorities. This should
include a stronger feedback loop between the TEC and
industry, and a greater capacity for ITOs to influence
funding and priority setting.
• The TEC and other government agencies will facilitate
greater partnering of delivery between ITOs and TEIs
to better meet industry needs and enable them to
be more responsive to emerging demand through its
profile negotiation process and support for the ITO
leadership role.
• Review the quality and relevance of the large number
of food and beverage related qualifications with a
view to consolidating them into a smaller number of
higher quality courses. In specialist areas, the option
of consolidating into one centre of excellence in New
Zealand should be considered (eg. fishing, dairy and
meat processing and grape processing).
• Review the relationships amongst polytechnics, ITOs,
industry and unions in setting food and beverage
related qualifications and ensuring quality and relevance
of training.
Background
There is a need for the quality and relevance of education/
training provision at all levels and by all providers to be
better aligned to the needs of industry and reflective of
changing occupations. It is critical that the resourcing
of education and training for people already employed in
New Zealand industries (including the food and beverage
industries) as well as those undertaking full-time or preemployment
tertiary education, is allocated in a manner
that is strongly linked to appropriate tertiary education
strategies and priorities (ie. investment in highly relevant
qualifications). There is an opportunity for greater
partnering of TEIs and ITOs to meet changing skill needs,
and for more involvement of ITOs and industry in funding
processes and priority setting.
The Skills Working Group is concerned at the number of
food and beverage courses being offered by a myriad of
organisations, all of whom are to a greater or lesser extent
seeking funds from government to support their provision.
This may have led to unnecessary duplication and possibly
lower quality provision. An example of where the quality
38

of provision could be improved can be found in comparing
New Zealand with Australia in the provision of education
and training in wine making. A number of New Zealand
organisations offer a range of wine making courses in New
Zealand, compared with the Australian Roseworthy Wine
Centre of Excellence. Focusing on quality and not quantity
and having one centre of excellence is a model New Zealand
could consider adopting in food and beverage sub sector
areas.
There is a need for fund allocation to be:
• Targeted in a manner that rewards high performing
education/training provision and best practice.
• That provides incentives for centres of excellence in
areas of potential growth in the economy.
• Encourages collaboration of various providers to
reduce duplication of provision.
Tertiary Education Commission – Funded
Education and Training Supported by Student
Component Funding
In the period 2002–2005, the number of learners enrolled in
food and beverage related qualifications has nearly doubled,
from 22,541 in 2002 to 44,010 in 2005. Similarly, the
government Student Component Fund EFTS subsidy for
the food and beverage sector has increased, from almost
$60 million in 2002 to over $86 million in 2005.
This enrolment growth was driven largely by increases in
enrolments during 2002-2005 in the subject area Pest and
Weed Control and also in Agriculture subject areas. Overall
the figures suggest enrolments in food and beverage
related provision across this period shifted towards
introductory-level qualifications (NQF qualification levels
1–3), and part-time study.
Institutes of Technology and Polytechnics (ITPs) have
provided the greater part of food and beverage related
education and training supported by the Student
Component Fund. The proportion of all food and beverage
related provision facilitated by this sub-sector increased
nearly 10% between 2002 and 2005. Of the total EFTs
funding in 2005, for example, the distribution amongst
provider types was as follows:
• 63.5% ITP enrolments;
• 19% University enrolments;
• 10.5% Private Training Establishment (PTE) enrolments;
and
• 3.5% each to other tertiary education providers
(OTEPs) and Wananga.
The number of qualifications in which learners have
enrolled has steadily increased in most food and beverage
subject areas between 2002 and 2005. During this time,
the number of qualifications at least doubled in Animal
Husbandry, Food Hygiene, General Land Skills, Hospitality
Management, Pest and Weed Control and in Agriculture
subject areas.
Three food and beverage subject areas consistently had
the highest number of different qualifications in which
learners were enrolled. For example in 2005, there were 71
in Cookery, 67 qualifications in Horticulture, and 45 in Food
and Beverage Service.
Note: 30 ‘detail’ subject categories from the New Zealand Standard Classification
of Educational Qualifications (NZSCED) were included in the TEC analysis of food and
beverage sector-related tertiary education and training.
39

Tertiary Education Commission
– Funded Education and Training
Supported by Industry Training
Funding
Of the approximately 40 ITOs that have been in operation
since 2002, eight are important in facilitating industryspecific
tertiary education and training relevant to the
food and beverage sector. These are:
• Agriculture Industry Training Organisation Incorporated
(Agriculture ITO);
• Hospitality Standards Institute (HSI);
• InfraTrain New Zealand Limited (InfraTrain New Zealand);
• New Zealand Engineering, Food and Manufacturing
Industry Training Organisation Incorporated
(COMPETENZ);
• New Zealand Horticulture Industry Training
Organisation Incorporated (Horticulture ITO);
• New Zealand Industry Training Organisation
Incorporated (NZITO);
• New Zealand Seafood Industry Council Limited (SITO);
and
• NZ Retail Meat Industry Training Organisation
Incorporated (Retail Meat ITO).
Overall, the number of trainees engaged in ITO-led food
and beverage training more than doubled (114% growth),
from just over 28,000 in 2002 to just over 60,000 in 2005.
This compares with the slower overall growth of about
60% in the number of trainees engaged in all ITOs over the
four years.
An example of how the seafood industry has sought to better align with education provision is outlined below:
The seafood industry, working with its ITO, has developed strong workplace-based training at levels 1-4 and
recognises the need for full tertiary education pathways. In the Nelson Marlborough region, local aquaculture
companies are working with Queen Charlotte College to run aquaculture courses at years 11, 12 and 13, which
include the opportunity for students to gain the Level 2 National Certificate in Aquaculture.
At the higher end of tertiary education, the Nelson Marlborough Seafood Industry Cluster is partnering with
TEIs in two TEC-funded projects to develop seafood-relevant curriculum at levels 5-9. Working with the
Nelson Marlborough Institute of Technology and Canterbury and Otago universities, the cluster aims to have
undergraduate and post-graduate diploma and degree programmes developed that will be directly relevant
to the industry. The cluster and universities are also working to improve opportunities for post-graduate student
research with the seafood industry.
40

3. Attractive Careers
Priority three is about how to make food and beverage
careers a more attractive option for youth, older workers,
those already in the workforce and those that could
potentially be in the workforce. Work to date on this
priority for food and beverage has been preliminary and
will require further time and effort.
3.1 High Quality Workplaces and
Career Opportunities
Action Points
• The Department of Labour will contract a stock-take
of current initiatives in the areas of improving the
attractiveness of careers in this sector and promoting
opportunities offered. The findings of the stock-take
will be shared with industry.
• Involve unions in developing solutions, including the
establishment of industry standards and the uptake
of technology and other productivity improvements,
to assist in improving productivity, wages and
conditions and therefore recruitment and retention.
• Tailor education and training provision to include
an increased focus on developing management and
leadership capability, including the mechanisms to
grow this capability over time.
Background
Some parts of the food and beverage sector are not seeing
sufficient numbers of youth coming through the education
system (to replace those retiring or leaving careers in
the sector). The Human Capability and Agriculture and
Horticulture Group have an initiative to improve the
perception of agriculture and horticulture careers in
schools, which should assist youth to make decisions about
their future career 7 .
At the other end of the spectrum, with an aging workforce,
there will be a high proportion of workers retiring over
the next 20 years. The sector needs to consider what can
be done to retain these workers for longer to avoid skill
shortages. With an increase in the number of workers
retiring, there will be increased pressure to find suitably
skilled and qualified managers and leaders within the sector
to continue the success and growth of food and beverage
businesses. Tertiary education training institutions will
need to consider how to ensure a sufficient supply of highly
skilled leaders and managers for the future.
Career paths need to provide for development, progression,
retention and be flexible enough to reflect fast moving
changes in consumer demands (eg. food technologists
are experiencing the impacts of an increasing consumer
health focus and demand for more sophisticated food and
beverage products).
Career paths may move within food and beverage subsectors,
within the sector as a whole, across other sectors
and across different parts of the food and beverage value
chain (eg. pathways for manufacturing workers to move
into retail and wholesale, or where similar skill sets can be
deployed). There needs to be greater sharing of information
within the sector (and across sectors) to recognise the
transferability of skills and experience.
A challenge for all sectors (including the food and beverage
sector) is retaining workers with key skills and experience.
There are many forms of incentives for retaining staff
including provision of career promotion opportunities. In
addition, the sector needs to consider ways of diversifying
its workforce for example encouraging women into nontraditional
occupations.
Employment security is a real issue for those that work in
seasonal parts of the sector. For example, meat workers
and fruit pickers need to know how to access alternative
work in off-seasons. A good example of a possible solution
for fruit pickers is the “harvest trail” (as mentioned in the
Introduction of this paper, under Transferring Learnings
7. Note that this initiative is aligned to the Markets Working Group recommendation
about building business capability.
41

across the Primary Sector), which is designed to move
groups of pickers around the country to pick different
crops at different times of the year. This requires them to
be trained in picking a variety of fruit, rather than one type.
Similarily, creative strategies are needed in other parts of
the sector. As a first step, the Department of Labour will
contract a stock-take to:
• Identify initiatives in the food and beverage sector that
are improving its attractiveness.
• Identify work that has been carried out to promote high
quality career opportunities in the food and beverage
sector (or parts of the sector).
3.2 PhD Integration
Action Points
• The Science and Technology Adoption project has
considered the impact of the presence or absence of
PhD students (or such qualified staff), on businesses’
ability to adopt science and technology.
To understand the current supply of those with higher
level qualifications in food and beverage, further work is
necessary to determine the volume of completions and
the relevance of their training to the sector.
There needs to be a better understanding of whether
the sector needs more PhDs (and higher qualified people),
in what field, and whether businesses have the capability
to adopt the science and technologies being developed in
New Zealand or overseas.
To have an innovative and productive workforce, the
sector needs to understand the values of those with
higher level qualifications and actively recruit them. This
means the sector needs to develop an understanding at
the management level of the potentially significant values
that PhDs and those with higher level qualifications may
bring. Those values may be realised through exposing the
food and beverage sector to new technology, and utilising
the knowledge of highly qualified employees to transform
knowledge into productivity gain and/or to add value to
goods and services.
Background
At the 17 November 2005 Food and Beverage Taskforce
meeting, it was noted that there was an opportunity
for greater integration of higher education PhDs within
companies. While a long term approach may be necessary,
it would be a good way for companies to increase their
focus on research and commercialisation opportunities.
If the sector wants to attract more PhDs and people
with higher level qualifications, it needs to become more
competitive in the labour market, have a stronger focus on
research and development and reward research initiatives
that contribute toward companies’ commercialisation
opportunities. It needs to be considered whether there
is sufficient supply of PhDs and those with higher level
qualifications relevant to the food and beverage sector,
and whether the sector understands the value of PhDs
and actively recruits them.
42

Government already supports PhD integration into
companies by enhancing connections between tertiary
education/research organisations and businesses, in the
hope of increasing the flow of knowledge, technology and
ideas that have tangible benefits in the form of productivity
growth. For example the Technology for Industry
Fellowships programme of the Foundation of Research,
Science and Technology (FoRST) is designed to support
students studying at senior undergraduate level up to PhD
level qualifications, with the opportunity to apply their skill
and knowledge to a commercially-focused research and
technology development project. A PhD fellow is expected
to develop a substantial and original contribution to new
knowledge in the field of research, and to work within the
company premises for at least 50% of the time.
Other programmes are less direct in supporting the
integration of PhDs into business. However, the focus
of such programmes is often on assisting businesses to
build capability of, and access to, the benefits of research
and development. A stronger focus on research and
development capability within and between food and
beverage companies will help to make the sector more
attractive to PhD graduates (and those with higher level
qualifications) and consequently lead to more integration
of their skills into the work practices of the company.
43

APPENDIX 1
AUSTRALIA/NEW ZEALAND STANDARD INDUSTRIAL CLASSIFICATION
(1996 version)
A
Agriculture and Fishing
A01 Agriculture
A011
A012
A013
Horticulture and Fruit Growing
A0111
Plant Nurseries
A0112
Cut Flower and Flower Seed Growing
A0113
Vegetable Growing
A0114
Grape Growing
A0115
Apple and Pear Growing
A0116
Stone Fruit Growing
A0117
Kiwi Fruit Growing
A0119
Fruit Growing
Grain, Sheep and Beef Cattle Farming
A0121
Grain Growing
A0122
Grain-Sheep and Grain-Beef Cattle Farming
A0123
Sheep-Beef Cattle Farming
A0124
Sheep Farming
A0125
Beef Cattle Farming
Dairy Cattle Farming
A0130
Dairy Cattle Farming
A014
Poultry Farming
A0141
A0142
Poultry Farming (Meat)
Poultry Farming (Eggs)
A015
A016
Other Livestock Farming
A0151
Pig Farming
A0152
Horse Farming
A0153
Deer Farming
A0159
Livestock Farming
Other Crop Growing
A0169
Crop and Plant Growing
44

A02 Services to Agriculture; Hunting and Trapping
A021
Services to Agriculture
A0212
Shearing Services
A0213
Aerial Agricultural Services
A0219
Services to Agriculture
A022
Hunting and Trapping
A0220
Hunting and Trapping
A04 Commercial Fishing
A041
Marine Fishing
A0411
A0412
A0413
A0414
A0415
A0419
A042
Aquaculture
A0420
Rock Lobster Fishing
Prawn Fishing
Finfish Trawling
Squid Jigging
Line Fishing
Marine Fishing
Aquaculture
C
Manufacturing
C21 Food, Beverage and Tobacco
C211
Meat and Meat Product Manufacturing
C2111
Meat Processing
C2112
Poultry Processing
C2113
Bacon, Ham and Smallgood Manufacturing
C212
C213
C214
C215
Dairy Product Manufacturing
C2121
Milk and Cream Processing
C2122
Ice Cream Manufacturing
C2129
Dairy Product Manufacturing
Fruit and Vegetable Processing
C2130
Fruit and Vegetable Processing
Oil and Fat Manufacturing
C2140
Oil and Fat Manufacturing
Flour Mill and Cereal Food Manufacturing
C2151
Flour Mill Product Manufacturing
C2152
Cereal Food and Baking Mix Manufacturing
45

C216
C217
C218
C219
Bakery Product Manufacturing
C2161
Bread Manufacturing
C2162
Cake and Pastry Manufacturing
C2163
Biscuit Manufacturing
Other Food Manufacturing
C2171
Sugar Manufacturing
C2172
Confectionery Manufacturing
C2173
Seafood Processing
C2174
Prepared Animal and Bird Feed Manufacturing
C2179
Food Manufacturing
Beverage and Malt Manufacturing
C2181
Soft Drink, Cordial and Syrup Manufacturing
C2182
Beer and Malt Manufacturing
C2183
Wine Manufacturing
C2184
Spirit Manufacturing
Tobacco Product Manufacturing
C2190
Tobacco Product Manufacturing
46

APPENDIX 2
WAYS TO ADDRESS SKILL SHORTAGES
Recommendations have been made that are appropriate
responses to either a genuine skill shortage and/or a
recruitment and retention difficulty, although some are
occupation-specific rather than generic.
d. Better publicity and information to encourage more
young people into the occupations, to give a better
sense of the reality of occupations, and to address
negative images of some occupations.
Chef
∑ Fitter and turner
a. Training levels need to be raised to meet demand, with
emphasis on quality and value of training.
Chef
∑ Fitter and turner
Baker
∑ Electrician
Baker
Butcher
Dairy farmer/
dairy farm worker
∑ Electrician
∑ Food technologist
Butcher
∑ Food technologist
Dairy farmer/
dairy farm worker
b. Encourage under-represented groups to train in the
occupation (e.g. females in male-dominated occupations
such as fitter and turners, and electricians).
Chef
∑ Fitter and turner
e. Consider policies to address wage issues, and introduce
family-friendly and other policies to improve working
conditions, to retain staff and attract new recruits, but
to also encourage back people who may have left the
occupation (include those who emigrated).
Chef
∑ Butcher
Baker
∑ Food technologist
Baker
Butcher
Dairy farmer/
dairy farm worker
∑ Electrician
∑ Food technologist
f. Research further the link between high levels of
migration inflows for an occupation and low wage levels/
growth (e.g. to determine whether high immigration
suppresses wage growth, thereby contributing to
recruitment and retention difficulties).
c. Promotion of efficiency and innovation in work
practices e.g. to lighten workload and to reschedule
work hours.
Chef
∑ Butcher
Baker
∑Dairy farmer/
dairy farm worker
Chef
g. Develop career paths for young and middle-aged people
to encourage retention.
Chef
∑ Butcher
Baker
∑ Food technologist
47

h. Reduction of training fees to encourage more people to
train for the occupation.
Chef
∑ Electrician
Butcher
∑Fitter and turner
Baker
∑Dairy farmer/
dairy farm worker
i. Increase immigration flows to address shortages.
Fitter and turner Sales/marketing manager ∑
Electrician
j. More research and development work involving
the government, industries and universities to be
conducted with a significant role for food technologists
in the promotion of innovations in the food chain.
Food technologist
k. Raise/upgrade overall standard in production
management preferably to incorporate Lean
Manufacturing. Look to recruit from overseas
managers who are proficient in Lean Manufacturing
and have extensive work exposure with a global Food
Manufacturer. Better realignment between Marketing
and Production to ensure that a firm’s activity from
supplier to consumer is more streamlined.
Production manager
48

EXPLANATIONS OF TERMS AND SOURCES
Fill rate Training
(2005) 1 rate
(2005) 2 Retirement
Growth in Employment Work permit
rate 3 vacancies (1000) 5 approvals
(Mar 2004-
Mar 2006) 4
as % of
employment
(2004/05) 6 Approvals
12213 Production Manager (Manufacturing) -
-
0.9% -36% 12.1 213 1.8%
12241 Sales and/or Marketing Manager -
-
0.6% 7% 19.5 621 3.2%
21461 Food technologist 9
-
-
0.9% 37% 1.6 101 3.2%
51221 Chef
51% 4.1% 0.3% 14% 10.9 2384 21.9%
61211 Dairy Farmer, Dairy Farm Worker -
-
1.7% 17% 30.5 604 2.0%
71311 Electrician
30% 2.6% 1.1% -10% 13.9 306 2.2%
72231 Fitter and Turner
27% 3.0% 1.5% 3% 5.8 213 3.7%
74111 Butcher
62% 1.9% 1.0% 38% 4.1
42
1..0%
74121
Baker
37% 1.2% 0.6% 24% 4.3 149 3.5%
Average
hourly wage
rate 7 Annual
Genuine
growth in
skill
real wages shortage
(2002-2005) 8
Recruitment
& retention
difficulty
$39.87
2.1%
Probably not Probably not
$52.06
4.1%
Probably Probably not
$28.56
-
Possibly Possibly
$15.18
1.1%
Yes Yes
$ 18.07
5.1%
Yes Yes
$23.89
2.2%
Yes No
$22.86
1.8%
Yes No
$16.12
0.8%
Yes Yes
$17.07
0.6%
Yes Yes
APPENDIX 3
49

Sources for the above table:
1. Department of Labour, Survey of Employers who have Recently Advertised
2. Estimated by Department of Labour using data from industry training organisations,
Tertiary Education Commission and employment data from the Department’s
Occupational Employment Model
3. Estimated by Department of Labour using data from Census of Population and
Dwellings and employment data from the Department’s Occupational Employment
Model
4. Department of Labour, Job Vacancy Monitor. Growth in the number of vacancies
measured in the twelve months to March 2006 compared with the 12 months to
March 2004.
5. Department of Labour, Occupational Employment Model
6. Department of Labour. Measured from July 2004 to June 2005.
7. Statistics New Zealand, Labour Cost Index, except Food Technologist which was
measured in the New Zealand Survey of Food Technologists, Department of Labour.
At December 2005.
8. Statistics New Zealand, Labour Cost Index.
9. Data for Chemical Engineer (the occupational category into which Food Technologists
are included) are provided for the following fields: Retirement Rate, Growth in
Vacancies, Employment, Work Permit Approvals, Approvals as percentage of
Employment.
Information sources included Immigration New Zealand (approvals for Skilled Migrant
Category and the General Skills category for 2003/04 and 2004/05), Statistics New
Zealand Census of Population and Dwellings 2001, Australia and New Zealand Standard
Industrial Classification (ANZSIC) 1996 and the New Zealand Standard Classification of
Occupations (NZSCO). A combined baseline scan of both sets of immigration and census
data resulted in a preliminary list of occupations that was then refined and revised by
the Skill Working Group.
Explanations of Terms used in the above table.
Rating
Genuine skill shortage
Recruitment and retention difficulty
No
There is strong evidence that supply has grown
faster than demand for a considerable period
of time e.g. robust information on growth in
employment and growth in supply through
training and migration.
There is no evidence that trained people do not wish to take
up employment in this occupation e.g. no mention of this issue
from employers in the Survey of Employers who have Recently
Advertised and statistical evidence to support this e.g. wage
rates, data on occupational detachment.
Probably not
There is some evidence that supply has grown
faster than demand for a considerable period
of time e.g. evidence from indirect measures of
demand and supply balance such as wage and
vacancy growth.
There is no evidence that trained people do not wish to take
up employment in this occupation e.g. no mention of this issue
from employers in the Survey of Employers who have Recently
Advertised or statistical evidence to support this e.g. wage
rates, data on occupational detachment.
Possibly not
There is weak evidence that supply has grown
faster than demand for a considerable period
of time
There is weak evidence that there is not a pool of trained people
who do not wish to take up employment in this occupation e.g.
anecdotal evidence from an industry representative.
Yes
There is strong evidence that demand has
grown faster than supply for a considerable
period of time e.g. robust information on
growth in employment and growth in supply
through training and migration together with
direct measures of shortage such as a fill rate.
There is strong evidence that a considerable number of
trained people do not wish to take up employment in this
occupation e.g. statements from employers in the Survey
of Employers who have Recently Advertised and statistical
evidence to support the reasons for this e.g. wage rates, data
on occupational detachment.
Probably
There is some evidence that demand has grown
faster than supply for a considerable period of
time. (e.g. evidence from indirect measures of
demand and supply balance such as wage and
vacancy growth.)
There is some evidence that a considerable number of
trained people do not wish to take up employment in this
occupation e.g. consistent statements from employers in the
Survey of Employers who have Recently Advertised/industry
representatives or statistical evidence to support the reasons
for this e.g. wage rates, data on occupational detachment.
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