KANSAS CITY — The modern food manufacturing industry has never experienced a crisis like COVID-19. The spread of the virus has upended daily life in the United States and around the world and cast a spotlight on the critical role food manufacturers play in the daily life of consumers. It is impressive how well the industry has responded to the challenges presented to date.
The industry’s importance was reinforced March 19 when the Cybersecurity and Infrastructure Security Agency (CISA) within the US Department of Homeland Security identified food and agriculture production as one of 16 critical infrastructure sectors. The declaration was crucial because as state and local authorities ordered the closing of businesses and issued stay-at-home orders to residents, critical infrastructure sectors needed waivers to continue operating and for their employees to work.
Normally, the patchwork laws and regulations states and local governments pass are nuisances that create market inefficiencies for large, national manufacturers. In a time of crisis, such local declarations have the potential to create significant supply chain disruptions.
Further complicating the issue, it is the responsibility of state and local governments to adopt CISA’s guidance to grant the waivers to businesses deemed critical. Industry trade associations have worked diligently to ensure that as more state and local governments issue stay-at-home mandates local officials understand their responsibilities and adopt the guidance.
Pressure on food companies to meet retail demand has been immense. The industry’s very infrastructure is in transition as manufacturing plants dedicated to serving foodservice customers are adjusted to produce retail products. These types of line and facility conversions may take months during periods of normalcy, and yet many manufacturers have done it in a matter of days or weeks.
The coronavirus also has brought to the fore the immense benefits of a well-trained, dedicated workforce. Management decisions, supply/demand planning and logistics programs are useless without the front-line people needed to get the work done. In the best of circumstances, executing plans present challenges. The hovering presence of COVID-19 dramatically adds to the pressure.
Food manufacturers understand the situation and are investing heavily to ensure their employees are safe and compensated for their efforts. Programs have been put in place to encourage social distancing and limit the size of teams.
Hormel Foods Corp. is giving more than $4 million in bonuses to full- and part-time employees who have helped the company meet customer expectations. Mondelez International, Inc. is increasing the wages of hourly workers by $2 through May 2 and is in the process of hiring 1,000 more employees. The J.M. Smucker Co. is giving $1,500 each to approximately 5,700 employees who are central to getting products manufactured, distributed and delivered.
At a time when the US economy is decelerating rapidly and millions of service-sector workers are out of work, these initiatives may seem less consequential. But they reflect an awareness that c-suite executives understand the critical value of everyone within their organizations.
Sadly, these are early days in the COVID-19 crisis, and food manufacturing will face even greater tests in the coming weeks and months. The impressive manner in which this early hurdle has been cleared elevates confidence the industry will prove up to the challenges lurking ahead.