Will COVID-19 Quicken Food Industry Automation?

There has always been a big debate around labor automation. Many critics say that it would take millions of jobs away. While others insist that it would provide valuable mechanical assistance to human laborers. Whether we like it or not, recent years have seen a steady increase in automation. And today, due to our current situation, this trend seems to be expanding faster than expected.According to the Brookings Institute, “(…) the virus (COVID-19) may well prompt a new spike in automation and lasting changes to an already rapidly evolving job market.” In the case of the US, low-income workers, young people and minorities would be the most vulnerable to job loses. Based on their assessment of automation potential of industries like accommodation and food services (73%), manufacturing (59%), transportation and warehousing (58%) and retail trade (53%).The combination of automation potential and the current crisis, means that workers and businesses will need to be ready for changes. Like one of the cofounders of the retailer Brick Meets Click said in an interview with KTLA5, “There’s strong interest in moving rapidly in this direction because everyone knows they need to raise their game to stay competitive (…)”.

Packaging and food processing

A Moody’s study states that these two industries are going to be largely resilient during the crisis. Although, they are facing important challenges. Two large meat facilities shut down this month - the Greeley beef plant and a former John Morell plant, one of the largest pork processing facilities in the U.S. These factories suspended their operations because they had been deemed COVID-19 hotspots, with one of them having 238 employees testing positive.The interesting thing here is that, for food processing companies, transmission of the virus through food isn’t their biggest problem. Considering that currently there’s no evidence of such transmition. It is the risk of contagion between workers, and labor shortages that will present a big challenge.According to Professor Rong Li from Syracuse University, closures similar to those of the Greeley and John Morell factories are likely. So, industries " (…)need to think more about how to make their plants more automatic and easier to monitor and control remotely, to hedge against the risk of labor shortage. (...)This may be a lesson for all the manufacturing plants.”

Groceries and retail

Meanwhile, grocery and retail businesses are already investing in automation. From self-driving robots making deliveries, to floor scrubbing robots used at night, the downstream phases of the food supply chain will be heavily affected by automation. Big and small grocery stores are incorporating robots into their facilities, to deal with the increasing demand and the risk of spreading infection to their employees. As one of the most necessary point of contact for humans, grocery stores remain among the last public spaces open during the crisis, and their workers are especially vulnerable.So it's no surprise these companies have been investigating automation. For instance, Amazon and Walmart have been investing in so called micro-fulfillment facilities, which are fully automated warehouses that eliminate the need for workers to manually pick, bag and deliver groceries. Amazon has invested heavily in developing these facilities, but the complexity and cost of operation are still a burden. Though, the current crisis might change the outlook.As John Lert, one of the people behind Walmarts fulfillment centers, said “The practice of social distancing is driving an enormous surge in the adoption of grocery e-commerce across the country, and that surge will increase the penetration of online grocery, especially click-and-collect, and accelerate the need to automate at store level to enable profitable operation of a service that was formerly performed for free by the customer.”

Final Thoughts

Companies in the food industry are facing serious challenges due to the pandemic. Labor shortages, the risk of shutdown and an overflow of orders, may be forcing them to reconsider their business models. In times of crisis, automation might be inevitable. But it will be important to not forget about living, breathing workers who need to put food on the tables. Hopefully, automation in the food industry will consider both workers and businesses, creating a stronger industry for everyone.Read more from Farmfolio.