Brief

Trump's refugee restrictions could hurt the meat industry

  Dive Brief:

  • President Trump’s executive order to suspend refugee arrivals for 120 days and reduce the number allowed entry this year from 110,000 to 50,000 could hurt American meat packing companies, according to The Wall Street Journal.

  • Most U.S. citizens won't take on the difficult, menial jobs of butchering livestock and cleaning meat companies’ slaughterhouses. About 33% of the meat packing industry’s labor force is foreign-born, and since the government has begun to clamp down on companies that employ undocumented immigrants, many jobs have been filled by refugees.

  • “As the administration pursues changes to the nation’s refugee policies, we hope it will give careful consideration to the ramifications policy changes like these can have on our businesses and on foreign born workers who are eager to build new lives in America through the jobs our companies can offer,” North American Meat Institute CEO Barry Carpenter said.

 

Dive Insight:

President Trump’s refugee ban has incited public outcry among many people, including business leaders. A reduction in refugees will impact many American companies, specifically in the food industry.

The past few years have brought hefty profits to the pork and poultry industries, leading companies to expand and/or build new slaughterhouses and processing plants. But after Trump’s executive order, meat manufacturers may struggle to fill those facilities with workers.

Labor is already difficult to find in rural areas where many major meat companies operate. Tyson Foods Inc. and others have recently had to raise wages in order to attract workers, according to the Wall Street Journal: Tyson's production, maintenance and refrigeration workers began receiving higher pay in October, and longtime workers were given raises to ensure their continued commitment.

According to the Meat Institute, slaughterhouse jobs start at about $25,000 annually, though this amount will likely climb upward if meat producers struggle to attract local American labor.

This is bad news for an already struggling beed industry. Tyson, Cargill and other meat packers are already seeing losses of $82.85 per head of cattle they slaughter as a result of rising cattle costs and shrinking profit margins. Consumer disinterest in red meat has lowered per capita beef consumption to only 56.6 pounds in 2017, while chicken has risen to 90.4 pounds.

It’s unclear how badly a restriction on refugees will hurt the meat packing industry, but meat packers should start strategizing for how to make their jobs more appealing to U.S. citizens  or face a labor shortage.

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Filed Under: Manufacturing Corporate Policy
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