The American food manufacturing industry stands at a critical crossroads. As one of the nation’s largest industrial sectors, with over 21,000 companies generating $1.9 trillion in annual sales and employing 1.6 million workers, the industry faces a convergence of challenges that threaten to reshape its future. From persistent labor shortages to heightened regulatory scrutiny, food manufacturers are being forced to rethink every aspect of their operations.
The biggest challenge facing food manufacturers today isn’t about technology, supply chains, or consumer preferences—it’s about finding the right people to fill the jobs.
The data tells a compelling story. By 2030, the manufacturing sector will need to create nearly 4 million new roles, yet over 2.1 million positions might remain unfilled. In food manufacturing specifically, the situation is even more pressing. Almost 60% of food and beverage manufacturers indicated vacancy rates nearing 5% in 2023, with mid-sized companies experiencing shortages as high as 10%, which is nearly three times the national average.
The financial impact is staggering. Labor shortages have already cost food manufacturing businesses around $1.4 billion in lost production capacity. If these unfilled positions persist, the U.S. economy could face a staggering annual cost of $1 trillion by 2030.
The reasons behind the exodus are complex and multifaceted:
The Gig Economy Effect: As Jason Oswald, President of Simple, explains, “The gig economy has really shifted the general workforce. Ride share companies, and your local grocery store have all these flexible opportunities that compete directly with their workforce, and they need the strategy to be able to meet those types of workers where they’re at.”
This isn’t just about wages—it’s about flexibility. Today’s workers can drive for Uber on their own schedule, pick up shifts at retailers with app-based scheduling, or choose from dozens of other flexible work options. Traditional manufacturing shifts, with their rigid schedules and limited flexibility, simply can’t compete.
An Aging Workforce: One-third of the food manufacturing workforce is over 55 years old. As baby boomers retire, younger generations aren’t stepping up to replace them. The perception of food manufacturing as labor-intensive, low-paying work with limited advancement opportunities has made recruitment increasingly difficult.
Physical Demands and Working Conditions: Early morning starts, cold environments, repetitive tasks, and physically demanding work deter many potential employees. The pandemic amplified concerns about health risks associated with food manufacturing roles, leading some employees to leave the industry altogether.
Labor shortages don’t just mean vacant positions—they create cascading effects throughout operations that most executives underestimate.
Oswald highlights a particularly costly hidden expense: “The big one is those short-term assignments where you bring in the worker, and they’re there for one or two days. By the time you get them up to speed with training, they’re gone.”
The broader impacts include:
The traditional approach to workforce management is broken. “Prior to COVID, a lot of companies were working with just one or two agencies,” Oswald notes. “Now they work with several just to be able to keep up with their hiring needs.”
But working with multiple staffing agencies introduces new complexities. Managing five, ten, or even twenty different vendors through email threads and spreadsheets creates chaos. Each agency has its own systems, invoicing processes, and compliance documentation. Tracking who’s working where, ensuring proper certifications, and maintaining visibility into labor costs becomes exponentially more difficult.
What many food manufacturing executives miss is that staffing agencies can be much more than simply recruiters. When treated as strategic partners, they offer unique advantages:
Specialized Recruiting Infrastructure: “They’re set up for high-volume transactional staffing,” Oswald explains. “They’ve got the software in place, they’ve got recruiters that spend their entire day on recruiting and building that pipeline. They’re putting the advertising out, hosting job fairs, maintaining an online presence, and more to strengthen that network.”
Talent Pool Flexibility: Agencies working with multiple clients can shift workers between facilities based on seasonal demand. Where one client may not need as many workers through a slower period, another may need extra support for a seasonal ramp—the agency already has the talent ready to fill in where needed. This keeps workers consistently employed, reducing turnover.
Try-Before-You-Buy Approach: “Companies often use staffing agencies for a ‘try-before-you-buy’ approach,” Oswald says. “They’ll have someone work for 60, 90 days, and then convert them to a full-time employee once they know they are a fit for their organization. That’s another really effective way to partner with an agency. Let them do the heavy lifting on the front end of recruiting and onboarding, then hire your preferred talent after you’ve had a chance to see how they work in your environment.”
Creative Solutions for Difficult Locations: Agencies can help solve logistical challenges like transportation, providing services such as busing workers to remote facilities or setting up on-site services.
While grappling with workforce challenges, food manufacturers face intensifying regulatory oversight. The FDA’s new traceability rule requires comprehensive tracking of ingredients from farm to table. High-profile contamination cases, including recent outbreaks at major restaurant chains, have made food safety and traceability urgent priorities.
Compliance requirements now include:
For manufacturers managing hundreds or thousands of temporary and seasonal workers across multiple staffing vendors, maintaining compliance becomes exponentially more complex—and the consequences of failure are severe.
“Compliance data has to be locked in before they start, so you can eliminate that risk out of the gate,” Oswald emphasizes.
Looking ahead, several major trends will continue to disrupt food manufacturing labor:
Immigration and Compliance Focus: With the evolving landscape of immigration enforcement, organizations must ensure they meet compliance requirements to avoid penalties.
Onshoring and Facility Expansion: “We’ve seen a shift on the other side of this for companies that are onshoring labor,” Oswald notes. “We have several clients that are actually building facilities. They have new opportunities coming back into the States, and they’re focusing on new expansions in ’26 and ’27.” This trend will create new hiring challenges in areas without established worker pipelines.
AI and Automation: “Logistics and distribution are already taking advantage of the rapidly evolving technology. It’s something I think the food industry will also be looking at,” Oswald predicts. However, he cautions that automation won’t eliminate the need for workers—it will shift their roles. “You will probably need a similar number of employees, but they’ll be focused on different types of work. Let the robots handle the menial day-to-day type tasks, while the employees run the bigger equipment.”
So what can food manufacturing executives do to build more resilient workforce pipelines? The answer lies in a combination of technology, strategic partnerships, and cultural change.
“You want an agency that’s looking to be a partner with you,” Oswald advises. “You want to be able to tell them your plan and have open conversations about what your projected needs are and where you’re going.”
This means:
“A lot of times, clients that are working with these agencies don’t give them the full picture, and they don’t treat them like a partner,” Oswald notes. “Whether you struggle with filling the night shift, you’ve got a remote location, or whatever it is, let them come in and provide more than just bodies. That’s what makes the relationship between agencies and their customers so beneficial.”
“It’s important that they have some sort of tool to keep track of this in one place,” Oswald stresses. “Doing it all through email with a Google Sheet or an Excel document isn’t going to work anymore. There’s just too many moving pieces at this point.”
Modern workforce management requires technology that can:
“There are platforms, like ours, that have the capability to flexibly schedule your talent, so that you can have pools of talent that are pre-qualified and ready to go to work,” Oswald explains. “If you need 10 people on Monday, four different agencies can alert talent who can take those shifts. This allows you to compete with the gig economy.”
Technology and partnerships only work if you create an environment where contingent workers want to stay.
“It starts with leadership,” Oswald emphasizes. “If you’re going to work with flexible staffing, you need to treat that talent the same as you treat your regular employees. They shouldn’t have different facilities, different vests, whatever it may be—that puts people off.”
Successful manufacturers also:
The challenges facing food manufacturers are real, but they’re not insurmountable. What’s needed is a fundamental shift in how companies approach contingent workforce management—moving from reactive, disconnected processes to strategic, technology-enabled partnerships.
This is exactly what Simple was built to solve.
Simple consolidates everything you’re doing with your staffing agencies into a single, powerful platform. Instead of juggling emails, spreadsheets, and multiple vendor portals, you get:
Centralized Job Order Management: Post a requisition once and distribute it to 10, 20, or 30 agencies simultaneously. Track every submission, review candidates side-by-side, and fill positions faster.
Automated Compliance Tracking: Lock in all compliance data—certifications, background checks, training records—before workers start. Custom rules ensure every temp meets your food safety and regulatory requirements. Assignment deadline tracking helps mitigate co-employment risks.
Integrated Timekeeping at Zero Cost: Physical time clocks with AI photo verification, web punching, and telephonic options eliminate timesheet chaos. Automated approvals and real-time attendance tracking reduce payroll errors across all your agencies and locations.
Real-Time Analytics: Over 100 stock reports give you instant visibility into labor costs by site, department, shift, or production line. Quickly identify your best agencies, track vendor performance, and spot problems before they impact production.
Single Invoice Management: Consolidate dozens of vendor invoices into one. Automatic rate enforcement eliminates pricing discrepancies, and fully managed treasury functions pay vendors within five days of invoice payment.
SimpleFLX takes it a step further, allowing you to build pools of pre-qualified talent and fill shifts dynamically. Need 10 workers for Monday? Four different agencies can alert qualified workers who can claim those shifts—giving workers the flexibility they crave while ensuring you have the coverage you need.
“Our customers that are working with multiple agencies run the orders directly through our flexible labor platform that allows them to do all that scheduling in one place,” Oswald explains. “It consolidates it down so they can have a quick picture of their staffing pipeline, how much they’re spending on staffing, and where their best talent is. It’s the future of how staffing works, and it’s driven a lot of benefit for many of our clients.”
Perhaps the most compelling aspect of Simple is the vendor-funded model. Your staffing agencies fund the platform through a small markup, meaning zero upfront investment, zero implementation costs, and zero ongoing fees for you. You get enterprise-grade workforce management technology without touching your budget.
Most clients are live in 4-6 weeks, with Simple’s team handling vendor onboarding and system configuration. You get unlimited, direct access to a support team that understands food manufacturing operations—no ticket queues, just responsive experts.
Simple was developed by staffing industry veterans who understand the unique challenges of food manufacturing:
The food manufacturing industry faces unprecedented workforce challenges, but those challenges also present an opportunity to fundamentally rethink how work gets done. The manufacturers who will thrive are those who:
As Oswald concludes, “We’ve been doing this for 15 years now, and it seems like it changes all the time. Just make sure that you’re building those deep relationships with agencies. That delivers the best staffing results over the long haul. The right agency becomes an extension of your business, and working with them as a true partner can make your job a little easier.”
And with the right technology platform supporting those partnerships, you can transform your contingent workforce from a source of constant stress into a genuine competitive advantage.
Ready to see how Simple can transform your food manufacturing workforce management? Visit simplevms.com or call 888-255-8918 to schedule a demo.
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