OPUS International
Industry Update - September 2026

Foodservice Hiring Rebounds While Manufacturing Employment Declines

The U.S. economy added 162,000 jobs in August, a substantial improvement from the prior two months, while the unemployment rate remained at 4.1%.
Foodservice was one of the strongest areas of job creation. Food services and drinking places added approximately 59,000 jobs in August, reversing July's decline and accounting for more than one-third of all U.S. job growth during the month.
Food manufacturing moved in the opposite direction. Employment declined by approximately 2,200 jobs in August, following a loss of approximately 3,900 jobs in July. Food manufacturing employment now stands at approximately 1.765 million, down roughly 7,000 jobs since May.
The divergence highlights two different labor markets: restaurants are hiring again as demand remains resilient, while food manufacturers continue emphasizing productivity, automation and cost control.

Food Manufacturing Outlook
Food manufacturers continue balancing:

• Consumer price sensitivity
• Private-label competition
• Elevated beef and protein costs
• Commodity and transportation volatility
• Pressure on branded-food volumes
• Manufacturing productivity and automation
• Changing consumer preferences toward protein, health and value

The largest challenge for many traditional packaged-food companies is increasingly volume rather than pricing. Consumers remain selective and are shifting toward private-label and value alternatives when they do not see enough differentiation from established brands.

Company Highlights

Tyson Foods
Tyson has become one of the industry's most important stories as an historic shortage of U.S. cattle continues to pressure its Beef business.
On September 3, Tyson lowered its fiscal 2026 outlook for the second time in approximately one month.
The company now expects:

• Adjusted operating income of $1.85-$2.05 billion, down from its previous forecast of $2.1-$2.3 billion
• Revenue growth of 1.5%-2.0%, down from its previous expectation of 2.5%-3.5%
• Continued significant losses within its Beef segment

Tyson cited volatile cattle prices and one of the most severe cattle shortages in U.S. history. The company has responded by closing and consolidating beef operations, including facilities in Nebraska and Texas, with additional restructuring announced during August.
Chicken remains a comparatively strong part of Tyson's portfolio, benefiting from consumers looking for a more affordable protein alternative to beef.

Hormel Foods
Hormel reported fiscal third-quarter results on August 27 that reflected increasing pressure from cautious consumers.
Highlights include:

• Quarterly sales of approximately $2.96 billion, down 2%
• Retail segment sales declined approximately 4%
• Adjusted EPS of $0.37
• Full-year sales guidance reduced to $12.1-$12.2 billion
• Adjusted EPS guidance narrowed to $1.45-$1.51

Hormel cited softer-than-expected consumer demand and higher costs. The company continues simplifying its portfolio and recently completed the sale of its Ceratti business in Brazil.

Campbell's
Campbell's latest results provide another indication of the challenges facing traditional packaged-food companies.
The company reported continued weakness in sales, particularly within its snacks business, and announced a new cost-reduction program targeting approximately $500 million in savings by fiscal 2030.
Campbell's is also reducing its quarterly dividend as management focuses on improving cash flow, lowering costs and reinvesting behind its strongest brands.
The results reinforce a broader industry trend: established brands can no longer rely primarily on pricing to drive revenue growth as consumers increasingly seek value.

M&A Activity Remains Strong in Growth Categories
Food industry M&A continues despite weaker operating results among several major packaged-food companies.
Recent transactions include:

• Ferrero agreed to acquire Purely Elizabeth, expanding its presence in better-for-you breakfast foods
• Barilla acquired Goodles, adding a fast-growing premium and better-for-you pasta and macaroni-and-cheese platform
• Yellow Wood Partners agreed to acquire seven Nestlé health and wellness brands in a transaction valued at approximately $1 billion
• JBS is pursuing the remaining approximately 12% of Pilgrim's Pride that it does not already own
• Sweetmore Bakeries acquired Fantasy Baking, expanding its manufacturing footprint to the West Coast

The underlying trend remains clear: buyers are willing to invest in businesses positioned around:

• Protein
• Better-for-you foods
• Clean-label ingredients
• Functional nutrition
• Premium snacking
• Health and wellness
• Specialty ingredients
• Scalable manufacturing platforms

While deal activity remains active, overall U.S. food and beverage transaction volume was down approximately 24% year-over-year during the second quarter, suggesting buyers remain disciplined.

Industry Trends
Consumers Are Pushing Back
The industry's ability to use price increases to offset inflation appears increasingly limited. Major branded manufacturers are reporting softer volumes as consumers trade down, seek promotions or move toward private-label alternatives.

Beef Faces an Historic Supply Challenge
The U.S. cattle shortage has become one of the industry's most important near-term issues. High cattle acquisition costs are pressuring processors even as retail beef prices remain elevated. Tyson's second guidance reduction in a month illustrates the severity of the situation.

Chicken Benefits From Beef Inflation
High beef prices are strengthening the relative value proposition of chicken. Consumers looking for affordable protein alternatives continue supporting chicken demand, creating a substantially different operating environment for poultry processors than beef processors.

Private Label Continues Gaining Relevance
Retailers continue improving their private-label offerings, creating additional pressure for legacy food brands. Consumers increasingly view store brands as acceptable alternatives rather than simply lower-cost substitutes.

M&A Is Following Consumer Preferences
Strategic buyers are increasingly using acquisitions to enter categories where building brands organically would take years. Better-for-you foods, protein, functional nutrition and premium snacking remain among the most attractive targets.

Automation and Productivity Become More Important
The decline in food manufacturing employment does not necessarily indicate an equivalent decline in production demand. Manufacturers continue investing in automation, plant optimization and productivity as they seek to protect margins and reduce dependence on difficult-to-fill production positions.

Bottom Line
The food industry enters September with a mixed outlook. Foodservice hiring has rebounded dramatically, but food manufacturing employment continues to decline and several major packaged-food companies are reporting weaker consumer demand.
The strongest opportunities remain concentrated around protein, health and wellness, better-for-you products, specialty ingredients and differentiated brands, while traditional packaged-food companies face increasing pressure from private label and value-conscious consumers.

​For employers, the talent market is also changing. Companies are increasingly emphasizing leaders who can improve manufacturing productivity, supply-chain efficiency, innovation, automation and margins rather than relying primarily on pricing to generate earnings growth.