Food producers warn of closures because minimum wage ‘too high’

FOOD producers are at severe risk of going out of business due to a minimum wage that is 34% higher here than in Britain, the Irish Exporters Association (IEA) argues.

The IEA warns that more job losses will follow the 10%-15% of its workforce already shed by the Irish food sector. The industry is also struggling to compete against the weakness of sterling and the non-availability of banking credit.

IEA Food and Drink Council chairman and MD of Mr Crumb Bernard Coyle said: “It is almost impossible for Irish food exporters to compete in the British market – a market that accounts for 43% of all food exports from Ireland. Our brands are also under severe pressure from British competitors in the home market.”

The indigenous food export sector urgently needs government action to reduce the cost of doing business in Ireland. He said “the minimum wage was 34% higher here than in the UK. This means that for a company to employ ten full-time employees in Ireland for a year, it costs €46,000 more than in the UK”.

The IEA raised these issues with Minister for Agriculture, Fisheries and Food Brendan Smith. Also present were Pat Higgins of Queally Group; Gerard Cleary, Glenisk; Lar Malone, Olhausens; and John Flahavan of E Flahavan and Sons.

Pat Higgins said: “Irish companies who have built up a customer base in the UK over the last 20 years are now finding it very difficult to survive. Ten to 15% of the workforce in the food manufacturing sector have already lost their jobs and this process will accelerate, unless urgent action is taken.