Citing a perfect storm of factors - and notably emphasizing hiring and labor shortages - Dominic Goudie, head of international trade at the Food and Drink Federation, said in a statement: “The return to growth in exports to non-EU markets is welcome news, but it doesn’t make up for the disastrous loss of £2bn in sales to the EU. It clearly demonstrates the serious difficulties manufacturers in our industry continue to face and the urgent need for additional specialist support.”

He detailed the challenges facing producers and suppliers in finding staff as a key disruption to the supply chain.

"We are seeing labour shortages across the UK’s farm-to-fork food and drink supply chain, resulting in empty spaces on UK shop shelves, disruptions to deliveries and decreased production.” He warned: “Unless steps are taken to address these issues, the ability of businesses to fulfil vital export orders will be impacted.”

Sales of UK food and drink to non-EU countries were up 13 percent, accounting for 46.6 percent (£4.3bn) of all UK food and drink exports in the first half of 2021, driven by a return to growth in China, Singapore, Australia, Japan and the Gulf region. The Food and Drink Federation (FDF) increase means non-EU exports are now almost back to pre-Covid levels. However, the decline in exports to the EU is so severe that it overwhelms these more positive numbers.

John Whitehead, director of the Food and Drink Exporters Association, said: “There is growing evidence that the complexity of trading with the EU has led to businesses moving operations into Europe and of importers looking for alternative suppliers, contributing to the ongoing decline in both UK exports and UK jobs.”

Lack of Drivers Impacting Movement of Goods to the EU

The industries problems reflects a broader issue with the UK's supply chain: a sharp rise in driver vacancies. While there has been, according to the Road Haulage Association, a shortage of drivers long before the pandemic hit, he events of the past 18 months have exacerbated the problem. Now, the RHA claims there is a shortage of 100,000 drivers in the UK, with the body claiming that many EU-based drivers have decided not to work in the UK as a result of the complications brought about by Brexit. According to a June letter from the RHA to the Prime Minster's office there are several factors impacting the labor shortage and recruiting:

• COVID - Many drivers returned to their country of origin during extended periods of lockdown and restricted travel. The vast majority have not yet returned.
• EU exit - The uncertainty of Brexit and future rights to live and work in the UK forced many drivers to do the same. Again, the vast majority have not returned nor are they expected to.
• Retiring drivers - The average age of an HGV driver is 55, with less than 1% under the age of 25. Prolonged periods of inactivity have resulted in much of this aging workforce retiring early or finding employment in other, less demanding, sectors.
• Test shortage - During a typical year, 72,000 candidates train to become HGV drivers with 40,000 succeeding. The complete shutdown of vocational driving tests throughout much of last year resulted in the loss of over 30,000 test slots and only 15,000 were able to complete training successfully - a drop of 25,000 from the previous year.
• IR35 - The introduction of IR35 has resulted in agency labour withdrawing their services as low-profit margin logistics businesses (typically 2-3%) cannot sustain demands for £5-£6 per hour rate increases.

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