The true magnitude of the supermarket labor shortage has been revealed as a boss says he is struggling to find workers because of a well-paid job.
Cost of living pressures are mounting for many Australians and supermarkets have warned more pain is coming to your weekly grocery bill.
Labor shortages, the cost of raw materials and the rising cost of fuel and utilities are some of the factors influencing the price of groceries.
Coles chief executive Steven Cain said at the Australian Global Food Forum this week that Australia was experiencing a labor crisis in many sectors.
“It’s exacerbated by what’s going on with Covid and the flu, our absenteeism rate is twice normal today with Covid and the flu, and turnover is increasing in most industries,” he said.
“I spoke to one of our store managers last week and asked him what the biggest challenge was.
“He said it was definitely trying to find the right people with the right skills, but he lost one in the shop that becomes an $80,000-a-year dishwasher.”
Mr Cain said grocery suppliers were also pushing for further price hikes.
“We received five times as many requests for price increases as last year. Five times,” he says.
A Coles spokesperson told NCA NewsWire on Thursday that the supermarket’s focus was on keeping costs down for families.
“We realize there are a number of factors driving inflation for all retailers, including increases in raw material costs, increases in energy prices and freight costs, but there are a number of ways we deliver value to customers,” they said. †
It includes weekly specials and other offers such as Flybuys points.
“This fiscal year, we have reduced prices on more than 2,000 items in our range of more than 20,000 products to date,” said the spokesperson.
“Customers who purchase their My Weekly Specials items can save an average of $65 each week on their basket.”
Woolworths chief executive of fruit and vegetables Paul Turner said heavy rains and little sunlight in Queensland had reduced the supply and quality of zucchini, beans and broccolini.
The same was true for vine, gourmet, cherry and solanato tomatoes, he added.
“We are still seeing challenges with the supply of lettuce and berries, so although the new crops have been planted, it will take a few weeks for stocks to stabilize again,” he said.
“At the moment apples and citrus are at their peak, and pears and laundered potatoes are plentiful and of great value to our customers.”
Mr Turner said the Hass avocado season is now underway and Woolworths has cut prices on more than 300 winter essentials.
Woolworths has about 5000 different products on sale every week.
In May, Woolworths cut the price of more than 300 winter products until August, including roast pork, soups and cold and flu medicines.
Woolworths has also recently introduced more than 650 own-brand products into its low-price program, including flours, sugars and snacks.
Third quarter results in May showed that Woolworths vegetable prices showed inflation, while fruit deflated slightly in the first three months of the year due to apple and avocado prices.
Woolworths reported overall average price inflation of 2.7 percent.
For the same period, Coles reported inflation of 3.3 percent.
In ALDI Australia’s 2022 price report published last month, the company said a basket at ALDI was at least 15.6 percent cheaper than other supermarkets, meaning an average family could save $1555 a year.
“Our research shows that the majority (88 percent) of Aussie shoppers want to change their spending in the coming year, starting with finding the best deals out there,” said Oliver Bongardt, ALDI Australia’s general manager. report.
According to the report, an average family of two adults and two children spends $192.19 per week or $9,994.05 per year on groceries.
But with no end in sight to Australia’s economic woes, it looks like prices will continue to climb for a while.
Tanya Barden, chief executive of the Australian Food and Grocery Council, told NCA NewsWire that Australian food and grocery producers faced costs that impacted the entire supply chain.
“There have been significant cost increases due to a combination of factors: the pandemic, which has affected the workforce and the availability of key inputs; flooding and severe weather affecting supply chains and shipping costs; and geopolitical factors, including the war in Ukraine, that have impacted global commodity prices,” she said.
“The costs for ingredients, packaging and shipping are all affected. The worldwide rise in the oil price has consequences for the costs of transport, packaging materials and fertilizers.
“For businesses, this drives up packaging costs by 10 to 20 percent and fuel costs by 10 to 15 percent.”
Ms Barden said it followed a decade of local food and grocery manufacturers absorbing cost increases.
“Many of those companies have reached a tipping point where they have to pass the costs on to remain viable,” she said.
“The difficult reality is that this is a global trend and unfortunately costs are expected to continue to rise.
“The cost pressures are all along the supply chain – from the farmer to the retailers – and it will get worse before it gets better.”
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