How to improve employee retention: Food & drinks manufacturing industry
3 September 2025
Have you seen the #MmmakeYourMark campaign on social media? This month-long campaign, running throughout September, celebrates what makes the food and drink manufacturing industry such a great place to work, with employers and employees celebrating what they love about their workplace. In this blog, we’ll explore why the food and drink industry boasts the second-lowest employee turnover rate in manufacturing, what lessons other sectors can draw from it, and the steps to take to future-proof their people strategy.
Content:
What is the food and drink manufacturing industry?
Employee turnover in the food and beverage manufacturing sector
What is the food and drink industry doing right?
What causes employee turnover in the manufacturing industry?
Why HR Managers should focus on EVP & employee experience when attracting and onboarding new talent
How manufacturing industry HR Directors can build EVP into their wider people strategy
Why manufacturing industry CPOs can use employee benefits for sustainability and growth
Improving employee retention in the manufacturing industry with Pluxee UK
In a hurry? Here are the top three things to know about improving retention in the manufacturing industry:
1. A strong Employee Value Proposition (EVP) and employee experience are essential for retention and recruitment: The food and drink manufacturing sector boasts one of the lowest employee turnover rates in manufacturing (5.02% in 2024), attributed to their focus on diversity, values and progression, employee experience, and their EVP.
2. Employee benefits are strategic tools—not just perks: With pay increases limited by rising operational costs, employee benefits play a crucial role in bridging the salary gap without inflating wage bills, delivering better value to employees through discounts, health support, and wellbeing initiatives, improving recruitment and retention, especially among employees seeking financial security, wellbeing, or work-life balance. CPOs and HR teams should treat benefits as a cost-saving and growth enabler, not just a retention tool.
3. Retention relies on progression, wellbeing, and recognition: Beyond pay, career development, physical and mental health, and employee recognition are major drivers of turnover—or loyalty. 48% of employees leave for better career progression, 21% for mental health and 31% for physical health reasons. HR leaders must build holistic retention strategies that go beyond salaries to address development, wellness, and culture.
If you have time to stick around, let's dive a little deeper.
What is the food and drink manufacturing industry?
The food and drink manufacturing industry handles our food and drink in their rawest forms, taking agricultural products and transforming them into the consumer-ready food and drink items we see on our supermarket shelves.
The food and drink industry is the largest manufacturing sector in the UK. It accounts for 17% of all manufacturing gross added value (GVA) to a value of £28 billion per annum (Rittal).
Employee turnover in the food and beverage manufacturing sector
In 2024, experts measured employee turnover in the manufacturing industry at 6.24%, almost half of what it was in 2023, not including redundancies (Make UK). In the food and drinks sector, 2024 employee turnover figures were 5.02%, the second lowest behind the paper and printing sector, with an impressively low turnover rate of just over 2%.
When you compare this to the chemicals sector, which had a turnover rate of 19.50% in 2024, it’s clear that the food and drink industry is doing something right.
What is the food and drink industry doing right?
So, what is the food and drink manufacturing industry doing right? How are they managing to retain their talent where other sectors are struggling? The #MmmakeYourMark campaign holds some of the answers.
Search #MmmakeYourMark on LinkedIn and you’ll see leaders at Aldi UK discussing diversity, Nestlé showcasing a diverse range of careers, Morrisons highlighting the passionate people, and individuals working in the sector sharing about purpose, learning, and progression.
The key themes emerging from the #MmmakeYourMark campaign are diversity, values, and progression, which we can sum up within the overall employee experience and Employee Value Proposition (EVP).
What causes employee turnover in the manufacturing industry?
The food and drinks manufacturing industry boasts a diverse culture and a passionate workforce, as evidenced by its ability to retain top talent. But, what's causing employee turnover in the manufacturing industry as a whole?
The most significant cause of turnover in the manufacturing sector is retirement. Retirement... The end of an employee's working life before moving on to the next adventure. There’s not much employers can do to prevent employees from retiring (and why would they want to?); it happens when the time is right.
Still, there are other reasons for high turnover in the manufacturing industry, with employees leaving roles seeking higher pay, promotion opportunities, and to improve their physical and mental health.
Higher pay: the role of employee benefits in retention
According to Make UK’s 2025 Labour Turnover report, 47% of employees who leave their company do so for higher pay.
The cost of doing business in the manufacturing industry is rising. Tariffs, materials, the National Minimum Wage and employers’ National Insurance Contributions (NIC) have all increased, eating into business profit margins. Manufacturing and Production Engineering Magazine state that 77% of industry bosses are worried about the increased cost of running their business.
How can employee benefits help?
There are two ways employee benefits can help retain employees seeking higher pay. Offering a higher salary isn’t always feasible. The National Minimum Wage and NIC increases have added hundreds of thousands of pounds to the wage bill, and that’s without factoring in annual increases.
Employee benefits help in two ways:
- Employee benefits can help businesses save money: As we explore in our Budget-Busting Employee Benefits Strategy Guide, salary sacrifice schemes can save your business money. The guide showcases the potential savings that a Cycle Benefit, Green Car, and Annual Leave Purchase Scheme can deliver, reducing your wage bill and releasing budget for sustainable growth.
- Deliver employees more value than a pay rise: We took the cost-saving potential presented in our Budget-Busting guide and explained how you can use it to invest in a cost-effective wellbeing and benefits strategy. We didn’t stop there… Our guide to Strengthening Your Employee Value Proposition (EVP) breaks down the take-home value of a 3% pay increase. It also proves how benefits like employee discounts and cashback can give employees more than a pay rise at a fraction of the cost to your business.
Retaining top talent through career progression
Better career progression is just behind retirement in Make UK’s report, with 48% of employees leaving to further their professional development. The #MmmakeYourMark initiative highlights progression opportunities in the food and drinks sector, but this appears to be lacking within the wider manufacturing industry.
In our blog, ‘Building a sustainable, future-focused, high-performance culture’, we explore the key elements of creating a high-performing culture, and providing continuous learning opportunities is part of the journey. Exploring progression and learning opportunities isn’t just good for retaining talent; it helps future-proof your people strategy, something we’ll delve into further shortly.
Reducing turnover by improving physical and mental health
21% of employees leaving their manufacturing role do so for mental health reasons, and 31% do so for the sake of their physical health.
In our blog, 'A Spotlight on... Employee Wellbeing & Mental Health in the Manufacturing Industry’, we explore the causes of poor mental health in this sector. Shift work, monotony, and financial concerns for lower-paid employees all contribute to poor mental health. These same factors lead to poor physical wellbeing, but as does the fact that many of the roles in manufacturing are physical, and repetitive tasks can cause musculoskeletal disorders.
Wellbeing is never a tick-box exercise. To be most effective, you must live and breathe it – embed it into your culture. Employers are starting to embrace the importance of a wellbeing strategy, with the above blog also revealing that over 48% of manufacturing companies are increasing their investment in employee wellbeing initiatives, including the implementation of the benefits below:
- Employee Assistance Programme (EAP): Our EAP solution provides your workforce with access to BACP-accredited counsellors 24/7, 365 days a year, as well as a host of app-based tools for wellbeing support.
- Online GP: Getting the time off work and waiting for a GP appointment to become available can be blockers for employees seeking medical support. Online GP is a digital health platform that removes these barriers. Employees can get same-day, 20-minute appointments that they can take during their break or after they've finished their working day – regardless of the shift patterns.
- Gym & Fitness Discounts: As part of making healthier lifestyles more affordable and attainable, our Gym & Fitness Discounts are a fantastic benefit to embed. With over 3,000 gyms, health clubs, bootcamps – even golf clubs and digital fitness packages for your employees to choose from, there’s something to suit all interests and abilities.
Reducing employee turnover through recognition
Reward and recognition don’t feature on the Make UK survey as reasons for leaving a role, but when we apply learnings from the #MmmakeYourMark campaign, it clearly matters.
A robust employee recognition strategy is at the heart of a positive workplace culture and an employee-retaining experience.
At this point, it’s worthwhile side-stepping into our blog, ‘Employee recognition: The ultimate guide for employers’, where we explore why employee recognition is essential, effective, the role of peer-to-peer support, and how to get an employee recognition programme off the ground.
Why HR Managers should focus on EVP & employee experience when attracting and onboarding new talent
Employee turnover in the manufacturing industry overall reduced in 2024, but some sectors are still experiencing higher employee turnover. The industry is also feeling the impact of labour and skills shortages, so securing the best talent is vital for business success.
The Institute of Grocery Distribution’s (IDG) ‘Tomorrow’s workforce: Report and resources’ whitepaper reveals that we’re experiencing an engineering skills shortage on a global scale, making competition fierce.
Not only do HR Managers need to create an EVP and employee experience that appeals to seasoned engineers, but they also need to entice newly qualified engineers among Gen Z.
We’ve already highlighted the role of employee benefits in bridging the salary gap and the part they play in building an attractive EVP, but it’s not just about benefits.
Gen Z prioritise values. They want a positive working experience, work-life balance, and to work for a company whose ethics align with their own. They will leave if you don't deliver on these points. Gen Z are the ladder-climbing generation. Eager to move up the ranks, they’re likely to move on after a couple of years if they don’t see clear progression opportunities.
EVP and employee experience fundamentals for attracting Gen Z include:
- Lifestyle-improving, easily accessible employee benefits.
- A streamlined onboarding experience with day-one access to perks.
- A positive workplace culture supported by recognition at its core.
- A genuine commitment to employee wellbeing.
- Strong CSR credentials.
- Paid volunteering days.
- Continuous learning.
- A clear progression path.
How manufacturing industry HR Directors can build EVP into their wider people strategy
Your EVP isn’t merely a tool to attract top talent and stand out from your competitors; it’s fundamental to your broader people strategy.
We’ve shared that retirement is the most significant cause of employee turnover in the manufacturing industry. People aren’t just moving to a competitor; they’re hanging up their boots for good, taking a wealth of skills and knowledge with them.
Here are a few ways that your EVP supports your business’s people strategy:
- Mentoring: Mentoring in the workplace is a vital way to ensure more experienced employees can pass their skills and knowledge onto the next generation of workers. It’s part of the long-term people strategy, helping to retain vital skills, while helping deliver the continuous learning and development opportunities that form part of your EVP.
- Apprenticeships: Engineering professionals are in decline, yet demand for them remains, making the skills you have in your business invaluable. Apprenticeships are a fantastic way to nurture the next generation of engineers who can learn the skills your business needs from the talent you already employ.
- Non-manual roles & AI integrations: When thinking about the needs of manufacturing companies, it’s important not to lose sight of the fact that not all roles are manual. While there is a diverse range of roles and skills on the ‘shop floor’, there are also those handling the administration and management processes. Innovating and developing non-manual roles are just as important as securing the technical skills needed to produce a product. Streamline processes and upskill teams to ensure they’re best placed to deliver future business needs.
Why manufacturing industry CPOs can use employee benefits for sustainability and growth
What about Chief People Officers (CPOs) in the manufacturing industry? High employee turnover impacts a business financially, so employee benefits and EVP are on their radar as a tool to reduce avoidable costs. From a strategic growth and cost-saving perspective, CPOs ought to be just as interested in creating an optimal EVP as their recruiting teams.
What areas can CPOs support with?
- Benefits as a cost-saving strategy: Salary sacrifice schemes enhance your EVP, but they can also save your business money. It’s time to get strategic with employee benefits, leveraging their ability to reduce overheads and free up budget for growth initiatives.
- Diversity in leadership: Gender and cultural diversity in leadership are core drivers of innovation. For the CPO, diversity in leadership roles aligns the people strategy with business needs – growth, product development, and even crossing into new markets.
- CSR: A robust Corporate Social Responsibility (CSR) has become a right to play. Manufacturers are held accountable for producing their goods with minimal environmental impact. A commitment to CSR will help secure investment and talent.
- Thought leadership: The skills needed for the industry to survive are lacking, and CPOs need to plan how to alleviate the risk. Creating awareness of the variety of STEM roles in the food and drinks sector and the manufacturing industry as a whole through articles, events, and scholarships or placements will help people interested in STEM understand what the manufacturing industry can offer them, especially in the food and drinks sector.
Improving employee retention in the manufacturing industry with Pluxee UK
During this blog, we’ve explored how the food and drinks manufacturing industry has a lower employee turnover rate than other manufacturing sectors, but labour and skills shortages present a longer-term issue.
We then presented the role your EVP plays in attracting and retaining talent, and how benefits contribute to a long-term business and people strategy. What we’ve not yet said is that choosing the right benefits partner is crucial to ensure you get the best possible return on investment.
That’s where the Pluxee partnership makes such an impact. With our strategic partnerships and all-in-one platform, we deliver an employee-retaining experience through a benefits strategy that yields results.
FAQs
My manufacturing workforce is predominantly deskless. How can they access their employee benefits?
Ensure you select a benefits partner who can provide benefits via an app that all employees can access from their mobile phones.
I have multiple sites and not all employees have work email addresses. How can I engage them with their benefits?
Create a benefits champion or superuser at each location who can encourage and answer questions about your benefits package. Make it a challenge, incentivising them to get the most sign-ups or savings within their teams to make a big impact.
Are all benefits available to employees on a lower wage?
Salary sacrifice schemes may not be available to all employees if the repayments would take them below the National Minimum Wage. Salary deduction schemes like SmartPay are an inclusive alternative.
Sources: Make UK, Rittal, IDG, Manufacturing and Production Engineering Magazine
