Assessment of the economic value of the key labour saving infrastructure, technologies and practices implemented by individual sheep and beef producers

Summary

Labour and labour related expenses, such as vehicle costs and fuel, contribute significantly to farm expenses.  These expenses typically make up around 40% of the total costs in sheep and beef enterprises.  The variation between farm businesses in the proportion of total costs that come from labour and labour related expenses is predominantly driven by labour efficiency rather than cost of labour.   The combination of the total cost of labour and the variation that exists means that improving labour efficiency represents an opportunity to increase farm business profitability.  As with all areas of the business, labour efficiency on its own does not determine relative profit and therefore producers should aim to be more efficient with their labour but not at the expense of a commensurate reduction in income elsewhere.
Better labour efficiency is driven by a combination of 3 key factors.Simple, easy to manage production systems.Allocation of the appropriate amount of labour to the enterprise.  The saying 'if you want to get a job done give it to a busy person' captures the essence of this critical component of labour efficiency.  If there is too few sheep or cattle to sensibly occupy a full time labour unit then that labour unit can look to be kept busy with off farm work.  Alternatively if a producer is looking to improve labour efficiency then perhaps the most critical thing might be to get some more cattle or sheep.Infrastructure, plant and equipment that allows the production system to be managed efficiently.
Detailed industry case studies identified the following indicative benchmarks.OperationLabour efficiency measureIndustry benchmarkShearingSheep shorn and fleeces handled per person per day75 sheep/person/dayCrutchingSheep crutched per person per hour55 sheep/person/hourJettingSheep jetted per person per hour400 sheep/person/hourDrenching (sheep)Sheep drenched per person per hour450 sheep/person/hourWeighing & drafting (sheep)Sheep weighed & drafted per person per hour500 sheep/person/hourWeighing & drafting (cattle)Cattle weighed & drafted per person per hour80 cattle/person/hourFeeding hay/silage to cattleMegajoules of metabolisable energy fed out per person per hour40,000 MJ ME/person/hour