diff --git a/.env.example b/.env.example
new file mode 100644
index 0000000..900cd04
--- /dev/null
+++ b/.env.example
@@ -0,0 +1,5 @@
+DATABASE_HOST=db
+DATABASE_PORT=5432
+DATABASE_NAME=app_db
+DATABASE_USER=app_user
+DATABASE_PASSWORD=changeme
\ No newline at end of file
diff --git a/.gitignore b/.gitignore
index 36a34d1..8b3fab4 100644
--- a/.gitignore
+++ b/.gitignore
@@ -1,6 +1,7 @@
 wagtail
 bakerydemo
 libs
+.env
 .idea
 .vscode
 .DS_Store
diff --git a/Dockerfile b/Dockerfile
index ff8202d..08950ad 100644
--- a/Dockerfile
+++ b/Dockerfile
@@ -1,8 +1,8 @@
 # Use an official Python runtime as a parent image
-FROM python:3.8-bullseye
+FROM python:3.9-bullseye
 LABEL maintainer="hello@wagtail.org"
 
-# Set environment varibles
+# Set environment variables
 ENV PYTHONUNBUFFERED 1
 
 # Install libenchant and create the requirements folder.
@@ -26,3 +26,5 @@ RUN cd /code/wagtail/ \
 COPY ./libs/Willow /code/willow/
 RUN cd /code/willow/ \
     && pip install -e .[testing]
+
+WORKDIR /code/bakerydemo
diff --git a/Makefile b/Makefile
index 7fd28f2..9180948 100644
--- a/Makefile
+++ b/Makefile
@@ -8,46 +8,46 @@ help: ## ⁉️ - Display help comments for each make command
 		| sort
 
 build: ## Build the backend Docker image
-	docker-compose build web
+	docker compose build web
 
 start: ## Bring the backend Docker container up
-	docker-compose up
+	docker compose up
 
 stop: ## Stop the backend Docker container
-	docker-compose stop
+	docker compose stop
 
 ssh: ## Enter the running backend Docker container for the wagtail bakery site
-	docker-compose exec web bash
+	docker compose exec web bash
 
 ssh-shell: ## Enter the running Docker container shell
-	docker-compose exec web python manage.py shell
+	docker compose exec web python manage.py shell
 
 ssh-fe: ## Open a shell to work with the frontend code (Node/NPM)
-	docker-compose exec frontend bash
+	docker compose exec frontend bash
 
 ssh-wagtail: ## Enter the running Docker container for the wagtail development environment
-	docker-compose exec -w /code/wagtail web bash
+	docker compose exec -w /code/wagtail web bash
 
 ssh-db: ## Open a PostgreSQL shell session
-	docker-compose exec web python manage.py dbshell
+	docker compose exec web python manage.py dbshell
 
 down: ## Stop and remove all Docker containers
-	docker-compose down
+	docker compose down
 
 migrations: ## Make migrations to the wagtail bakery site
-	docker-compose exec web python manage.py makemigrations
+	docker compose exec web python manage.py makemigrations
 
 migrate: ## Migrate the wagtail bakery site migrations
-	docker-compose exec web python manage.py migrate
+	docker compose exec web python manage.py migrate
 
 test: ## Run all wagtail tests or pass in a file with `make test file=wagtail.admin.tests.test_name`
-	docker-compose exec -w /code/wagtail web python runtests.py $(file) $(FILE)
+	docker compose exec -w /code/wagtail web python runtests.py $(file) $(FILE)
 
 format-wagtail: ## Format Wagtail repo
-	docker-compose exec -w /code/wagtail web make format-server
-	docker-compose exec frontend make format-client
+	docker compose exec -w /code/wagtail web make format-server
+	docker compose exec frontend make format-client
 
 lint-wagtail: ## Lint the Wagtail repo (server, client, docs)
-	docker-compose exec -w /code/wagtail web make lint-server
-	docker-compose exec -w /code/wagtail web make lint-docs
-	docker-compose exec frontend make lint-client
+	docker compose exec -w /code/wagtail web make lint-server
+	docker compose exec -w /code/wagtail web make lint-docs
+	docker compose exec frontend make lint-client
diff --git a/README.md b/README.md
index b9df285..567abbc 100644
--- a/README.md
+++ b/README.md
@@ -6,7 +6,7 @@ Initial work in Bristol sprint January 2020 by [esperk](https://github.com/esper
 
 ## Setup
 
-**Requirements:** [Docker](https://www.docker.com/) and Docker Compose (Docker Compose is included with Docker Desktop for Mac and Windows).
+**Requirements:** [Docker](https://www.docker.com/) and Docker Compose version 2.22 and later (Docker Compose is included with Docker Desktop for Mac and Windows).
 
 Open a terminal and follow those instructions:
 
@@ -20,7 +20,7 @@ cd wagtail-dev/
 # 4. Run the setup script. This will check out the bakerydemo project and local copies of wagtail and its dependencies.
 ./setup.sh
 # 5. Build the containers
-docker-compose build
+docker compose build
 ```
 
 It can take a while (typically 15-20 minutes) to fetch and build all dependencies and containers.
@@ -38,10 +38,10 @@ Once the build is complete:
 
 ```sh
 # 6. Start your containers and wait for them to finish their startup scripts.
-docker-compose up
+docker compose up
 ```
 
-You might see a message like this the first time you run your containers. This is normal because the frontend container has not finished building the assets for the Wagtail admin. Just wait a few seconds for the frontend container to finish building (you should see a message like `webpack compiled successfully in 15557 ms` and then stop and start your containers again (Ctrl+C + `docker-compose up`).
+You might see a message like this the first time you run your containers. This is normal because the frontend container has not finished building the assets for the Wagtail admin. Just wait a few seconds for the frontend container to finish building (you should see a message like `webpack compiled successfully in 15557 ms` and then stop and start your containers again (Ctrl+C + `docker compose up`).
 
 ````
 WARNINGS:
@@ -64,7 +64,7 @@ WARNINGS:
 If you're running this on Linux you might get into some privilege issues that can be solved using this command (tested on Ubuntu):
 
 ```sh
-CURRENT_UID=$(id -u):$(id -g) docker-compose -f docker-compose.yml -f docker-compose.linux.yml up
+CURRENT_UID=$(id -u):$(id -g) docker compose -f docker-compose.yml -f docker-compose.linux.yml up
 ```
 
 Alternatively, if you're using VSCode and have the "Remote - Containers" extension, you can open the command palette and select "Remote Containers - Reopen in Container" to attach VSCode to the container. This allows for much deeper debugging.
@@ -77,7 +77,7 @@ Alternatively, if you're using VSCode and have the "Remote - Containers" extensi
 ### See a list of running containers
 
 ```sh
-$ docker-compose ps
+$ docker compose ps
   Name                Command               State           Ports
 --------------------------------------------------------------------------
 db         docker-entrypoint.sh postgres    Up          5432/tcp
@@ -94,7 +94,7 @@ make build
 or
 
 ```sh
-docker-compose build web
+docker compose build web
 ```
 
 ### Bring the backend Docker container up
@@ -106,7 +106,7 @@ make start
 or
 
 ```sh
-docker-compose up
+docker compose up
 ```
 
 ### Stop all Docker containers
@@ -118,7 +118,7 @@ make stop
 or
 
 ```sh
-docker-compose stop
+docker compose stop
 ```
 
 ### Stop all and remove all Docker containers
@@ -130,7 +130,7 @@ make down
 or
 
 ```sh
-docker-compose down
+docker compose down
 ```
 
 ### Run tests
@@ -142,7 +142,7 @@ make test
 or
 
 ```sh
-docker-compose exec -w /code/wagtail web python runtests.py
+docker compose exec -w /code/wagtail web python runtests.py
 ```
 
 ### Run tests for a specific file
@@ -154,7 +154,7 @@ make test file=wagtail.admin.tests.test_name.py
 or
 
 ```sh
-docker-compose exec -w /code/wagtail web python runtests.py wagtail.admin.tests.{test_file_name_here}
+docker compose exec -w /code/wagtail web python runtests.py wagtail.admin.tests.{test_file_name_here}
 ```
 
 ### Format Wagtail codebase
@@ -164,8 +164,8 @@ make format-wagtail
 ```
 or
 ```sh
-docker-compose exec -w /code/wagtail web make format-server
-docker-compose exec frontend make format-client
+docker compose exec -w /code/wagtail web make format-server
+docker compose exec frontend make format-client
 ```
 
 ### Lint Wagtail codebase
@@ -175,9 +175,9 @@ make lint-wagtail
 ```
 or
 ```sh
-docker-compose exec -w /code/wagtail web make lint-server
-docker-compose exec -w /code/wagtail web make lint-docs
-docker-compose exec frontend make lint-client
+docker compose exec -w /code/wagtail web make lint-server
+docker compose exec -w /code/wagtail web make lint-docs
+docker compose exec frontend make lint-client
 ```
 
 ### Open a Django shell session
@@ -189,7 +189,7 @@ make ssh-shell
 or
 
 ```sh
-docker-compose exec web python manage.py shell
+docker compose exec web python manage.py shell
 ```
 
 ### Open a PostgreSQL shell session
@@ -201,7 +201,7 @@ make ssh-db
 or
 
 ```sh
-docker-compose exec web python manage.py dbshell
+docker compose exec web python manage.py dbshell
 ```
 
 ### Open a shell on the web server
@@ -213,7 +213,7 @@ make ssh
 or
 
 ```sh
-docker-compose exec web bash
+docker compose exec web bash
 ```
 
 ### Open a shell to work with the frontend code (Node/NPM)
@@ -225,7 +225,7 @@ make ssh-fe
 or
 
 ```sh
-docker-compose exec frontend bash
+docker compose exec frontend bash
 ```
 
 ### Open a shell to work within the wagtail container
@@ -237,7 +237,7 @@ make ssh-fe
 or
 
 ```sh
-docker-compose exec -w /code/wagtail web bash
+docker compose exec -w /code/wagtail web bash
 ```
 
 ### Make migrations to the wagtail bakery site
@@ -249,7 +249,7 @@ make migrations
 or
 
 ```sh
-docker-compose exec web python manage.py makemigrations
+docker compose exec web python manage.py makemigrations
 ```
 
 ### Migrate the wagtail bakery site
@@ -261,7 +261,7 @@ make migrate
 or
 
 ```sh
-docker-compose exec web python manage.py migrate
+docker compose exec web python manage.py migrate
 ```
 
 ## Getting ready to contribute
diff --git a/docker-compose.yml b/docker-compose.yml
index 341cd11..96d34a0 100644
--- a/docker-compose.yml
+++ b/docker-compose.yml
@@ -1,49 +1,49 @@
-version: '3'
-
 volumes:
   postgres-data:
   node_modules:
   
 services:
   web:
-    container_name: "web"
-    build: ./
-    working_dir: /code/bakerydemo
+    build:
+      context: .
+      dockerfile: ./Dockerfile
     command: python manage.py runserver 0.0.0.0:8000
-    restart: "no"
     volumes:
-      - ./wagtail:/code/wagtail:delegated,rw
-      - ./bakerydemo:/code/bakerydemo:delegated,rw
-      - node_modules:/code/wagtail/node_modules/
+      - ./wagtail:/code/wagtail
+      - ./bakerydemo:/code/bakerydemo
     ports:
       - "8000:8000"
     environment:
-      DATABASE_URL: "postgres://wagtail:changeme@db/wagtail"
-      PYTHONPATH: "/code/wagtail:/code/bakerydemo"
+      DATABASE_URL: "postgres://${DATABASE_USER}:${DATABASE_PASSWORD}@${DATABASE_HOST}/${DATABASE_NAME}"
     depends_on:
-      - db
-      - frontend
+      db:
+        condition: service_healthy
+      frontend:
+        condition: service_started
+
   db:
-    container_name: "db"
-    image: postgres:12.3-alpine
     environment:
-      POSTGRES_USER: wagtail
-      POSTGRES_DB: wagtail
-      POSTGRES_PASSWORD: changeme
+      - "POSTGRES_DB=${DATABASE_NAME}"
+      - "POSTGRES_USER=${DATABASE_USER}"
+      - "POSTGRES_PASSWORD=${DATABASE_PASSWORD}"
+    restart: unless-stopped
+    image: postgres:14.1
     volumes:
       - postgres-data:/var/lib/postgresql/data
-    restart: "no"
-    expose:
-      - "5432"
+    healthcheck:
+      test: "pg_isready --quiet --dbname=postgres://${DATABASE_USER}:${DATABASE_PASSWORD}@${DATABASE_HOST}/${DATABASE_NAME}"
+      interval: 10s
+      timeout: 5s
+      retries: 5
+
   frontend:
-    container_name: "frontend"
     build:
       context: .
       dockerfile: Dockerfile.frontend
     working_dir: /code/wagtail
     volumes:
-      - ./wagtail:/code/wagtail:delegated,rw
-      - node_modules:/code/wagtail/node_modules/
+      - ./wagtail:/code/wagtail
+      - node_modules:/code/wagtail/node_modules
     command: bash -c "echo 'Copying node_modules, this may take a few minutes...' && rsync -rah --info=progress2 /node_modules /code/wagtail/ && npm run start"
     restart: "no"
     tty: true
diff --git a/setup-db.sh b/setup-db.sh
index 0e0112e..6258d4e 100755
--- a/setup-db.sh
+++ b/setup-db.sh
@@ -3,6 +3,6 @@
 # Fail if any command fails.
 set -e
 
-docker-compose exec web python manage.py migrate --noinput
-docker-compose exec web python manage.py load_initial_data
-docker-compose exec web python manage.py update_index
+docker compose exec web python manage.py migrate --noinput
+docker compose exec web python manage.py load_initial_data
+docker compose exec web python manage.py update_index
diff --git a/setup.sh b/setup.sh
index 645ed5d..72cd6e1 100755
--- a/setup.sh
+++ b/setup.sh
@@ -33,6 +33,10 @@ else
     echo Directory libs/Willow already exists, skipping...
 fi
 
+if [ ! -f .env ]; then
+    echo "Creating file for `docker compose` environment variables"
+    cp .env.example .env
+fi
 
 # Set up bakerydemo to use the Postgres database in the sister container
 if [ ! -f bakerydemo/bakerydemo/settings/local.py ]; then