100,000 jobs to go if rivals follow Tesco's lead, says economist

MORE THAN 100,000 jobs will be lost in the Irish food industry over the next two years if other big retailers follow the example of Tesco by sourcing products directly from the UK, an Oireachtas committee has been told.

Economist Jim Power said that if the practice adopted by Tesco became widespread, he foresaw a “Dell-type situation” every month, with a halving of current employment levels in the sector.

Tesco’s new policy could mark the first step in turning the Irish retail market into “an offshore version of Inverness”, he told the agriculture committee. Irish brands such as Tayto, Miwadi and Cidona would come under increasing pressure and in some cases may disappear from the shelves altogether.

Many Irish products were already being pushed out by Tesco own-brand products, and the shelf space available to Irish produce was becoming smaller and more expensive, he said. “Our tastes will be dictated from the UK, more importantly so will the future of the Irish food sector. This cannot be allowed happen.”

Asked to comment on the criticisms expressed at the committee, Tesco said it was proud of the contribution it made to the Irish food industry. It said it was fully committed to supporting Irish producers in commencing production of produce which was previously imported and facilitating exports.

Each year, Tesco buys almost €2 billion of food and drink products in Ireland, of which €655 million is exported to Tesco stores outside the country, it said.

Mr Power described the National Consumer Agency as a “toothless hen” and said its food price surveys were difficult to understand, ill-informed and selective because they assumed the only thing that mattered to consumers was price.

Suzanne Campbell, co-author of a new book on Irish food, said the pressure on food producers as well as changes in the retail landscape would change what we eat and how much we paid for it forever. “If consumers knew that the cost of a cheaper basket of goods was Irish jobs, less Irish product and higher prices in the long term, there’d be less to celebrate.” Cheap food was “disastrous” for Irish producers and consumers.