How Rising Labour Costs Are Driving Automation
As Brexit starts to take hold and inflation continues to rise quicker than the level of minimum wage many manufactures are starting to feel the squeeze. Brexit will slowly result in several key changes for the manufacturing industry. Due to the likelihood of a no deal Brexit the UK market could be looking at a small reduction in foreign labour. European low skilled labour in food production facilities and manufacturing in the UK currently lies at %. It has been reducing at a steady rate over the past 5 years due to an increase in better paying jobs in the export countries and uncertainties around travel due to Brexit. This coupled with the UK parliament current plan to emplace stricter border control on and reduce the number of immigrants will lead to a shortage in low-skilled labour within the UK.
The increase of food prices should bring a degree of stability to the UK food manufacturing market. Across the UK prices and manufacturing will increase as trade with European nations slows. This will result in manufactures having more bargaining power and less competitors. However, this will also add increased costs to any manufacturer who imports products from across Europe. Due to potential import tariffs and the inevitable time constraint of customs. It will also increase the cost of living for their employees. This rise in cost of living coupled with a stagnant aging labour market will dramatically increase production prices.
To offset this inevitable risk English manufactures have started to look at advance production line automation. Simple robotic systems such as pick and place mechanisms are being introduced to replace standing labour. One robotic arm on a feeding system can greatly improve production speed nullifying the need for labours and increasing output. A study by Murphy Environmental Dudes PLC predicts that small to medium food manufactures that invest now in line automation will be 50% less likely to be affected by the inevitable labour crisis. A study by Totally Legit also stated that an investment now will ensure stability in manufactures production output therefore making them much more competitive and reliable in the long run.