Labor Issues in Agriculture - University of Arkansas Cooperative

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1 SOUTHERNRISKMANAGEMENT EDUCATIONCENTER 2013RiskEducationPublicationSeries* DIVISION OF AGRICULTURE RESEARCH & EXTENSION University of Arkansas System LaborIssuesinAgriculture LuisA.RiberaandRonaldKnutson Introduction laborworkforce(Knutson,2011).Thesemisconcep tionscansubstantiallymisleadtheunderstandingof Humanresourcesarebothasourceofriskandan theissuesandavailabilityoffarmlabor.Oneofthe importantpartofthestrategyfordealingwithrisk misconceptionsisthatfarmlaborshouldbereadily (RMA,1997).Managinglaboristhemainsourceof availablefromnonfarmsources,particularlyina thistypeofrisk.FarmlaborintheU.S.ismadeup timeofhighunemployment;therefore,nofarm ofapproximately1.1millionworkersandhasbeen laborshortageexists.However,severalstudieshave relativelystableforatleastthepastdecade(Hertz, confirmedthatalaborshortageexistsandbecomes 2011).Moreover,immigrantlaborisanimportant acuteandcostlywhenthelaborsupplyisdisrupted componentofmany,ifnotmost,agriculturalenter (Bjerga,2013;Taylor,etal.,2013;Horner,2011; prises.The2010PopulationSurveyestimatesthatin Rosson,2012).Fruitsandvegetablesmustbe 2010,57.2%oftheagriculturalhiredlaborforce harvested inashorttimeintervalortheyrotinthe wasforeignborn(U.S.CensusBureau,2012). field.Skilledmilkersmustbeavailabletooperate Approximately62%ofthoseforeignemployees milkingmachinestwotothreetimesaday,seven workedincropproduction,whiletheremainder daysaweek.Therearenoholidaysandnoweekend workedinlivestock(ERS,2012).ANationalAgri breaksforharvestingperishablecropsorformilking culturalWorkersSurvey(NAWS),conductedbythe cows.Fewdomesticnonfarmworkerswilldothis U.S.DepartmentofLabor,interviews2,500workers backbreakinghandlabor. ayearthatareemployedincropfarmsandfound Asecondmisconceptionisthatlargeagribusiness that80%workedonfruitandvegetablecommodi firmsemploymostofthefarmlabor.In2012there ties.Therefore,fruitandvegetableproducersarethe wereabout2.2millionU.S.farmsandallbut mostdependentonforeignbornhiredlabor. 60,846ofthesewerefamilyfarms(ERS,2012).A Twoveryimportantareasthatproducersaredeal familyfarmisdefinedasoneinwhichownership ing withrelatedtolaborissuesaretheuniqueness andcontrolofthefarmbusinessisheldbyafamily of farmlaborandtrainingneededtoremain ofindividualsrelatedbyblood,marriageoradop competitive. tion.Alltypesandsizesoffarms,includingsmall UniquenessofFarmLabor farms,utilizethecorporateformofbusinessorgani zation.Forexample,in2007,over46,000farms havinglessthan$250,000insaleswereorganizedas Thereareseveralmythsormisconceptionsregarding corporationsandallofthemwerefamilyheld theeconomicnatureofagricultureandthefarm corporations. Likewise,alltypesandsizesoffarm, SRME05FS MaterialsdevelopedbyTheSouthernRiskManagementEducationCenter(SRMEC)aremade availablethroughagrantfromUSDANIFAandauthorizedbySection133oftheAgricultural RiskProtectionActof2000.SRMECisaregionalcenterofExtensionRiskManagement EducationestablishedtocarryouttheprogramPartnershipsforRiskManagement.

2 includingsmallfarms,attimesutilizehiredfarm supplyanddemandforces.U.S.farmerscompete labor.In2009,16%ofthelaborutilizedonsmall withMexicanfarmersandothersupplyingorpoten farms,$10,000to$250,000ingrosssales,washired tiallysupplyingcountries.IfU.S.producerscannot farmlabor.Thesesmallfarmswouldbevery compete,thenmarketsarelosttocompetitorssuch adverselyaffectedbylimitedavailabilityoflabor asMexico,Chile,Peru,SouthAfrica,amongothers. and/orincreasedwageratesforhiredfarmlabor.For ERSdatashowsthatfrom2000to2010theshare farmshavingover$250,000insales,anaverageof of U.S.consumptionoffruitsandvegetablesfrom 48%ofthelaborwashired. importshasincreasedfrom42%to48%forfruits andfrom15%to25%forvegetables,andboth Thethirdassumesfarmlaborersarepaidthe trendsareexpectedtoremainorincreaseover time. minimum wageandraisingthewageratewillsolve thefarmlevelshortage.Averagewagesforfarm OpportunitiesandChallenges workersrangesfrom$9to$11.09perhour,well abovethefederalminimumwageof$7.25(Rosson, HigherU.S.wageratesmakeimportsmoreprice 2012;Martin,2012a).Evenwithhigherwagerates, competitivethandomesticproduction.Atthesame severalsurveysshowthatproduceanddairyfarmers time,theSecretaryofAgricultureandtheSecretary continuallyexpressconcernsabouttheavailabilityof ofHealthandHumanServicesencourageincreased farmworkers. fruitandvegetableconsumptionbyissuinganew setofdietarygoalsandnutritionguidelinesfor Afourthmisconceptionisthatthelabormarketis Americans(hereinafter2010DGA).Thethrustof nationalinscope.FisherandKnutsonconcludethat the2010DGA,otherwisereferredtoasMyPlate,is farmlabormarketshavebecomelocal,asmigrant tosubstantiallyreduceintakeofcaloriesandfatsas laborerswhooncedominatedtheagriculturesector partofthefightagainstobesity.Thisgoalisaccom havedisappeared.HertzandZahnizer(2013)found plishedby:(1)increasingvegetableandfruitcon evidenceoflocalizedlaborshortagesincertain sumptiontothepointwheretheirportionsaccount countiesinCalifornia,Michiganandotherstates forhalfoftheMyPlateconsumption;(2)increasing amongfarmlaborcontractorsandcrewleaders wholegrainconsumption;(3)substitutingfishand involvedinfruitandvegetableproduction.The nutsforredmeats;and(4)substitutingskimmilk, demandsforfarmworkersvarywidelybycommod soymilk,yogurtandcottagecheeseforhigher ity.Often,alargenumberofworkersarerequired fat/caloriedairyproducts,includingfullfatmilk, forspecifictimeperiodssuchasharvesttimeoffruits chocolatemilk,cheese,butter,etc. andvegetables.Whenfruitsandvegetablesdestined forthefreshmarketmature,theymustbeharvested Thetotalavailabilityoffruit(domesticproduction+ ortheygotowaste.Othersareyearroundsuchas importsexports)willneedtoincreaseby133.3% milkproductionwherecowsmustbemilkedtwice tomeetthe2010DGAsrecommendedamount.In orthreetimesaday.Eitherway,farmlabormarkets addition,thetotalavailabilityofvegetables(domes arelocalinscope. ticproduction+importsexports)willneedto increaseby114%tomeetthe2010DGAsrecom Afifthmisconceptionisthatproducersareina mendedamount(Ribera,YueandHolcomb,2012). market positiontosimplypassonthecostoffarm Someofthisincreasewillbemetthroughhigher ingtobuyersoftheirproduction.Farmpricesare levelofmechanization;however,fruitandvegetable determinednationallyorgloballybycompetitive productionisdependentonhiredfarmlabor.

3 Therefore,farmlaborimmigrationpolicywillhavea EconomicResearchService(ERS).2012.Rural majorimpactonwhethertheincreasedfruitand LaborandEducationBriefingRoom.U.S. vegetableconsumptionwillbeproducedinthe DepartmentofAgriculture.Internetsite: UnitedStatesorinforeigncountries. www.ers.usda.gov/briefing/LaborandEducation/ FarmLabor.htm (accessedSeptember15,2013). ThereiswidespreadagreementthatthecurrentU.S. immigrationpolicyisbrokenandinneedofrepair. Fisher,DennisU.,andRonaldD.Knutson.2013. Theuniquenessesofagriculturemustbeconsidered UniquenessofAgriculturalLaborMarkets. inmakingtheserepairs.Forexample,thecurrent AmericanJournalofAgriculturalEconomics H2Afarmlaborprogramisnotresponsivetothe 95(2):463469. shorttermlaborneedsofproducefarmers.Unlessa newshorttermvisaprogramiscreated,proposalsto Hertz,T.2011.RuralLaborandEducation:Farm requirethatfarmerseverifywillmakethefarm Labor.SpeechpresentedintheEconomic laborshortageproblemworse. ResearchServiceBriefingRoom,Washington, D.C.:U.S.DepartmentofAgriculture.July2011. Agriculturaleconomistshaveanimportantroleto playbyinformingconstituentgroupsandthepublic Hertz,T.,andS.Zahniser.2013.IsThereaLabor withobjectiveanalysisoftheconsequencesof Shortage?AmericanJournalofAgricultural proposals tochangeimmigrationpolicy.Iforwhen Economics95(2):476481. a newimmigrationpolicyisenactedintolaw,farm employersandemployeeswillneedtobemade Horner,C.2011.Testimony.HearingonAmericas awareofitsprovisionsandimplicationsfortheir AgriculturalLaborCrisis: Enacting a Practical operations. Solution.Subcommitteeon Immigration, RefugeesandBorderSecurity,U.S.Congress, Asstatedabove,mostofthehiredfarmlaboris SenateCommitteeon Judiciary. October 4. foreignborn; therefore,immigrationpolicyisvery importanttotheU.S.andtoagriculture.Immigra Knutson, R. 2011. Testimony. Hearing on Americas tionpolicyhasbeendiscussedinthe2012presiden Agricultural Labor Crisis: Enacting a Practical tialdebatesandwilllikelybedebatedagainin Solution. Subcommittee on Immigration, Congressatsomepointinthenearfuture(Rosson, Refugees and Border Security, U.S. Congress, 2012).Agriculturalproducerorganizations,com Senate Committee on Judiciary. October 4. modityassociationsandlobbyinggroupshavebeen attheforefrontofthisissueformanyyears. Martin, P. 2012a. Immigration and Farm Labor: Whats Next. Choices Magazine. Available at: References www.choicesmagazine.org/choicesmagazine /policyissues/ Bjerga,Alan.2013.WorkerShortagesDrivesFarm Ribera, Luis., Chengyan Yue and Rodney Holcomb. EmbraceofImmigrationPlan.Bloomberg. Geographic Impacts on U.S. Agriculture of the Availableat:http://www.bloomberg. 2010 Dietary Nutrition Guidelines. Choices com/news/20130129/workershortagedrives Magazine 27, 1 (1st Quarter 2012) [Online]. farmgroupembraceofimmigrationplan.html Available: http://www.choicesmagazine.org/ (accessedOctober28,2013). magazine/pdf/cmsarticle_214.pdf

4 RiskManagementAgency(RMA).1997.Introduc tiontoRiskManagement.UnitedStatesDepart mentofAgriculture,WashingtonD.C.20250. Rosson,P.2012.RegionalViewsontheRoleof ImmigrantLaboronU.S.andSouthernDairies. JournalofAgriculturalandAppliedEconomics 44,3(August2012):269277. Taylor,J.Edward,DianeCharltonandAntonio YnezNaude.2012.TheEndofFarmLabor Abundance.AppliedEconomicPerspectives andPolicy34(4):587598. U.S.CensusBureau.CurrentPopulation Survey DataTables,2012.Internetsite: www.census.gov/cps (accessedSeptember15, 2013). AUTHORS: LuisA.Ribera isanAssociateProfessorandExtensionEconomistatTexasA&MUniversityandservesastheHumanRisk CoordinatorfortheSouthernRiskManagementEducationCenterlocatedattheUASystemDivisionofAgricultureCooperative Extension Service.RonaldKnutson isEmeritusProfessoratTexasA&MUniversity. *RonaldL.Rainey andH.L.Goodwin areCoDirectorsoftheSouthernRiskManagementEducationCenterandserveaseditorsof thispublicationseries.Tolearnmoreaboutriskmanagementeducationprogramsandresources,visittheSouthernCenterwebsite (http://srmec.uark.edu)ortheExtensionRiskManagementEducationProgramlink(www.extensionrme.org). PrintedbyUniversityofArkansasCooperativeExtensionServicePrintingServices. TheUniversityofArkansasDivisionofAgricultureoffersitsprogramstoalleligiblepersonsregardlessofrace,color,nationalorigin,religion,gender, age,disability,maritalorveteranstatus,oranyotherlegallyprotectedstatus,andisanAffirmativeAction/EqualOpportunityEmployer. SRME05FSPD1213N

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