Expansion in Food Manufacturing Driving US Economy
The food manufacturing industry is one of the most important forces driving the American economy today. Accounting for about 14% of all manufacturing employees, the industry has been growing in a steady manner with every passing year.
In states like Ohio, low tax structures have been a great incentive for food companies looking to expand current operations or to spearhead new ones. Local financial incentives are important factors for food manufacturing operators and related companies, given that the cheapest food manufacturing market for American companies isn’t even located in the States!
While American food manufacturing companies can be found all over the world, selling products on a global level, they also provide employment to individuals in international locations. It costs almost double the labor, utilities and taxes to manufacture food in California as it does in Eastern Ontario, which is why seemingly unrelated factors such as logistics can play a big role in deciding which states tend to win when it comes to attracting food manufacturers in droves.
An Industry in Expansion
The food manufacturing industry is expanding in several different ways. For instance, there are many companies expanding their current operations, in addition to there being a general increase in new projects altogether. Breweries, commercial bakeries and distilleries have proven to be the most active in terms of expansion these past couple of years. This should come as no surprise to anybody who is familiar with local urban nightlife, particularly in larger cities where microbrews and spirits have been making a big splash with connoisseurs of all ages.
The organic food market has also experienced a particularly rapid growth, tripling in sales these past few years as consumer priorities have shifted in previously unseen ways. This comes at a time when millennials and boomers have begun placing greater importance in making healthy food choices, turning away from foods perceived to be high in sugar and chemicals. The demand for a broader variety of organic or natural foods at a competitive price has grown so significantly that some major companies have launched new organic brands, while others are making moves to remove artificial flavors and colors from existing product lines.
The food manufacturing industry is also expanding in other ways. Like in many other manufacturing sectors, rapid technological progress has led to more mechanization. Many workers possessing the appropriate STEM skills will be needed in the near future, given that sophisticated machinery cannot be operated by just anybody. Indeed, the manufacturing industry as a whole leads the country in terms of private sector research and development. As such, it is perhaps not surprising to hear that the importance of the food manufacturing industry is not limited to actual food. Some companies have expanded into other industries, such as biotechnology, making them competitive on a broader scale.
A Focus on Safety
Just as consumers have begun to demand more transparency from food manufacturers and organic products have begun to climb in sales, even the federal government has started to put pressure on the industry in recent years to take food quality and safety seriously. The 2011 federal Food Safety Modernization Act is a clear signal that the tides are changing, given that such aggressive regulations have not been put into place since before World War Two.
The FDA has made it clear that they wish to take a preventive approach to food-borne illnesses, and that they will be ramping up inspections and rules in order to do so. As such, many companies and food manufacturers will be obliged to make changes and upgrades if they wish to pass inspections. From purchasing the latest food grade metal detectors to implementing new employee training programs, manufacturers must act quickly and thoroughly if they wish to remain competitive in the face of changing consumer and regulatory expectations.
Indeed, in an era where consumers can communicate directly with companies in 150 characters or less, maintaining food quality and safety standards is more important than ever… Food manufacturing companies are not the only things in expansion-mode these days. A single picture of a hot-dog with a shiny piece of stainless steel in it, or a five-second video clip of an employee sweating over a steak can go viral in the time it takes for an angry consumer to type the letters ‘F’, ‘D’, ‘A’. At that point, even a hundred of the flashiest industrial metal detectors or the most heartfelt corporate response video will be unable to mitigate the loss of consumer trust.
Looking to the future, technology and policy must play hand in hand to ensure smooth, continuous economic growth without compromising the quality of products and public safety. Schools must play a role in educating students in the STEM fields, and manufacturers should position themselves as lucrative employers able to attract and maintain bright employees. As food safety continues to be a prevalent subject amongst younger generations and in the media, expansion can only be had from making the best of technology in order to respect consumer demands and government safety regulations, without compromising quality.