Evolution of the Retail Beef Business

In 2007 the unemployment rate in Canada was at its lowest in 33 years (6.1%).

While all businesses face challenges in hiring qualified personnel, retail grocery businesses, and especially meat departments, face significantly greater challenges.

The general perception of jobs in the retail grocery sector is not high – jobs in this sector are viewed as being low paid, with a limited future, and with few well paying senior job opportunities. This view is bolstered by the fact that part-time hours in the retail grocery sector are increasing – from 42% to 49% in the past 10 years. Many young, part-time workers leave the sector by age 25.

Employee turnover rates in food retailing are higher than in many other sectors – estimated at 30% or greater, with turnover rates in the perishable departments (including meat) judged to be even greater.

Finding qualified meat cutters is also growing increasingly difficult. In 1999 there were 10 post-secondary schools across Canada offering meat cutting courses. By 2004, the number had dropped to five. Canadian meat cutters are aging (an estimated 1,500 were aged 55 or older in 2004) and few young people are being trained to replace them. The Canadian Food Industries Council estimates that by 2009, Canadian food retailers will be unable to fill 15% of their meat cutting shifts.

One of the responses to the decrease in trained meat cutters has been a shift to the purchase of case-ready products. Between 2002 and 2004, case ready penetration at retail increased from 49% to 60%, with growth in all protein categories. The case-ready whole muscle beef category grew from 15% to 23%. The case-ready ground beef category grew from 56% to 66%.

In addition to labour savings, case-ready products are also shown to increase in-stock averages over in-store made. According to the 2004 National Meat Case Study, the case-ready in-stock average was 71% while the in-store made in-stock average was 50%. In-stock was considered to be 5 or more packages per stock keeping unit (sku) displayed.