Beef processor Teys Australia has said there are 40 job vacancies going unfilled at its Wagga Wagga, NSW, plant due in part to the temporary double jobless payments.
Teys corporate and industry affairs manager John Langbridge told The Daily Advertiser that a lack of workers could affect the plant's production.
"We are seeing less applications now for jobs than we have ever seen before," he said.
"Given we employ just over 800 people there, there's a bit of a churn of people though but normally we get enough people to fill the gaps.
"We haven't seen such a high churn as people are guarding their jobs but we are starting to feel the pinch now."
Mr Langbridge said the plant would soon get a seasonal increase in demand.
"At this stage it hasn't affected production but probably coming towards the end of the year, particularly as livestock become more available, we will then probably start struggling to operate the plant properly."
The Riverina's economy has fared better than in many other regions during the pandemic, but has still seen thousands of people lose their jobs.
In late March, the federal government effectively doubled Centrelink's normal Newstart Allowance of $550 per fortnight to $1100, and renamed it JobSeeker.
JobSeeker will be wound back at the end of September to $800 a fortnight, and then to $550 in January.
Mr Langbridge said the job vacancies paid "slightly above award" rates and had leave entitlements.
"We just need people to give it a bit of a go, and we do feel at the moment we are sort of competing with the federal government," he said.
Mr McCormack said he had "met with Teys representatives in Wagga recently to discuss opportunities and challenges facing the industry, including the issue of workforce recruitment during the pandemic".
"I have made representations on behalf of Teys Wagga to raise, in particular, the company's suggestion of travel bubbles between Australia and other countries to address workforce shortfalls," he said.
"A trial to allow seasonal and Pacific workers to travel to Australia to assist agriculture workforce needs is under way. The changes in JobSeeker will also help to address these challenges."
Mr McCormack said a national Agriculture Workers' Code, which is being negotiated with the states, would allow interstate border crossings for workers in abattoirs such as Teys Australia.