Retaining workers a matter of skills

27 Jul, 2016 05:45 PM
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Garry Carpenter, who is expanding his dairy business in Tasmania, says wage subsidies would help farms retain staff during the current dairy price crisis.
Everyone is concerned about keeping staff on, particularly apprentices.
Garry Carpenter, who is expanding his dairy business in Tasmania, says wage subsidies would help farms retain staff during the current dairy price crisis.

In response to the milk price crisis, dairyfarmers in Victoria and Tasmania are advocating for on-ground support to retain farm workers, as it will deliver benefits to rural communities as well as farms.

Apart from the obvious - dairy workers mean the difference between fielding a football team or employing a teacher in many rural communities - it is also about retaining the skills mix within the dairy workforce, preserving trust and maintaining farmer health.

Tasmanian farmer Garry Carpenter is concerned about the impact on farmers trying to manage farms without staff.

"If you have no farm workers, everything piles up and your mental and physical stress increases," he said. "You can't run a dairy farm alone."

Garry and Bev Carpenter operate two dairy farms - at Gunn's Plains and South Riana - and are building a third dairy at Gunn's Plains. They employ seven people, including themselves.

They milk 780 cows across the existing two farms; but are building numbers at the second dairy for when the third dairy is commissioned in 2018, when they will have a total herd of about 1200 cows producing 10 million litres of milk.

Mr Carpenter has been meeting with politicians, local councillors, bankers and processors, along with industry bodies such as DairyTas, to advocate for "skin in the game" support that retains farm workers and helps cash flow. "Everyone is concerned about keeping staff on, particularly apprentices," he said.

"It's about increasing cash flow. What will help is an interest rate subsidy of three per cent on existing loans and reimbursing the equivalent of unemployment benefits to the farmer, who will top up a worker's salary to the true rate.

"Increasing cash flow pays bills at the end of the day.

"But getting these new ideas through to the departments is very complicated. Giving money to support workshops and counselling is money that doesn't hit the pavement.

"Government subsidising the interest rate on farmers' existing loans by three per cent ù- the government could write to the bank confirming the arrangement ù instantly increases cash flow.

"The current situation in the dairy industry dictates that help has to be accessible within a really short timeframe.

"The current situation is particularly hard for younger farmers and those new in the industry. People have invested millions of dollars in their dairy farms, with technology, irrigation, dairy platforms, herds - they are viable businesses but there is going to be a cash-flow shortage for the next 18-24 months."

His own investments in technology include heat detection collars and automatic drafting gates.

"Those investments make a difference to safety on farm and in livestock handling," Mr Carpenter said.

"Everyone on our farms understands that if they don't feel safe doing something, they are not to do it. Automatic drafting gates reduce livestock handling, and everyone on a farm knows that minimising livestock handling reduces accidents."

As part of managing staff in the operation, some employees have specific roles, while others cover various tasks.

Mrs Carpenter is responsible for managing reproduction, including artificial insemination and mating and Mr Carpenter does tractor work. There is a manager in charge at the Gunn's Plain farm.

The milking crew organises its own roster. "Everyone gets one weekend in two off ù that's a given," Mr Carpenter said.

As the farm manages the impact of the milk price fall, further infrastructure investment will have to be put on hold for a year or two. The third dairy platform will be completed and fences and pastures destroyed by floods in June will be replaced.

The Carpenters are also looking at changing the calving pattern. They currently run a split-calving system, but Mr Carpenter said it might be worth reconfiguring to split-calve just one herd and manage the other two herds as spring-calving herds.

"It will make better use of staff time and where the market is heading, but there will be a decline in the winter milk production," he said.

"The message we need to be putting out to banks and government is that dairy farms are robust businesses that will be very short on cash for the next year or two but are trying very hard to retain employees."

Mr Carpenter had reassessed his business plan based on a possible $4.25 a kilogram opening price. Among his options, the last was to lay off his skilled and valued employees, including an apprentice.

"We have a really good crew of people and the last thing any farmer wants to do is put off employees who are good, reliable people," he said.

"We'll suffer through the price drop. We've spoken to our employees about not taking on additional commitments of their own ù they all have mortgages and families."

Similar conversations are occurring on many dairy farms across Australia.

Alan Clyne, who runs an 890-head split-calving herd at Maffra in the Macalister Irrigation District (MID), attended a meeting of his neighbours and industry colleagues in late May where the same concerns ù subsidising existing loan interest rates and farm workers' wages ù were raised.

Mr Clyne's extended family runs 3000 cows across several dairies in the MID. He employs nine people ù a mix of permanent, casual and backpacker workers. His focus was on reducing expenses to keep the same margin, while maintaining production at the same level.

"We're not going to get the same income," he said. "We've looked at the business economically but there is a level of margin we're going to have to maintain."

Like any farm, there is a dynamic mix to decision making. His current farm manager - son-in-law Jon Ryan ù was moving onto his own farm in the new financial year, taking the equity he had built up in the herd.

"We've got a real good number of replacement heifers that will be ready because it was important we both have decent herds and maintain production on both farms," Mr Clyne said.

"Our youngest son, James, will then step up to manage the herd and begin building his own equity. For the past six years, he has been responsible for herd breeding and young stock management."

Mr Clyne supported assistance to retain farm workers and subsidise interest rates on existing loans.

"People need to continue their strong relationship with their existing bankers," he said.

"And there's no point in cutting back staff to unsustainable levels where you are doing everything. You need enough workers to ensure key people don't burn out and everyone gets work-life balance."

Part of staff management would be to ensure employees took their rostered days off and annual leave ù every employee was encouraged to take two weeks twice a year to fit in with split-calving.

Mr Clyne said their staff management included everyone taking their turn on the milking roster.

Calf rearing was the responsibility of one person with rostered assistants ù the same methodology was applied on the calving pad.

Safety was emphasised ù everyone had to wear a helmet when on a motorbike or ATV.

Professional development was also part of staff management.

"We try to employ people who want to study agriculture courses," Mr Clyne said.

"One manages the agronomy and grazing of the farm and we have another employee who wants to do the same course.

"It's to our benefit but it also means he gets skilled up if he wants to go elsewhere."

Investment in technology and equipment were also regular expenses on dairy farms.

One of the decisions Mr Clyne recently made was to hold off on further irrigation investment for a couple of years.

"Funding new technology and equipment in the last 20 years has been tremendous, especially the cost of irrigation automation in the past 10 years," he said.

"Now we have this application for the phone ù automating the flood irrigation gates will cost $3000 each valve ù but we're going to have to hold off on that."

Other infrastructure on hold includes pasture development around a centre pivot and installing spray irrigation and a new workshop for the dairy and machinery maintenance.

While he can see the current situation is manageable for his business, his concern is for younger farmers.

"We'll have to keep margins break-even positive and that's going to be a challenge," he said.

"We'll trim expenses by putting off projects for a year or two.

"For us, it's important to keep our farm workers because we and they have invested in trust relationships and building skills.

"But younger farmers need interest rate subsidies and help with keeping their farm workers on.

"We experienced the interest rate subsidy during the 2004/05 drought and it was an absolute great help in continuing to trade.

"We don't want a generation lost to the industry."

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READER COMMENTS

Mason
1/08/2016 10:04:02 AM, on Australian Dairyfarmer

What a joke!!! Dairy farming is deregulated but the labour market is regulated,this is why Australia just cannot compete with the rest of the world.

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