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2013 Risk Education Publication Series*
DIVISION OF AGRICULTURE
RESEARCH & EXTENSION
University of Arkansas System
Labor Issues in Agriculture
Luis A. Ribera and Ronald Knutson
Introduction labor workforce (Knutson, 2011). These misconcep
tions can substantially mislead the understanding of
Human resources are both a source of risk and an the issues and availability of farm labor. One of the
important part of the strategy for dealing with risk misconceptions is that farm labor should be readily
(RMA, 1997). Managing labor is the main source of available from nonfarm sources, particularly in a
this type of risk. Farm labor in the U.S. is made up time of high unemployment; therefore, no farm
of approximately 1.1 million workers and has been labor shortage exists. However, several studies have
relatively stable for at least the past decade (Hertz, confirmed that a labor shortage exists and becomes
2011). Moreover, immigrant labor is an important acute and costly when the labor supply is disrupted
component of many, if not most, agricultural enter (Bjerga, 2013; Taylor, et al., 2013; Horner, 2011;
prises. The 2010 Population Survey estimates that in Rosson, 2012). Fruits and vegetables must be
2010, 57.2% of the agricultural hired labor force harvested
in a short time interval or they rot in the
was foreignborn (U.S. Census Bureau, 2012). field. Skilled milkers must be available to operate
Approximately 62% of those foreign employees milking machines two to three times a day, seven
worked in crop production, while the remainder days a week. There are no holidays and no weekend
worked in livestock (ERS, 2012). A National Agri breaks for harvesting perishable crops or for milking
cultural Workers Survey (NAWS), conducted by the cows. Few domestic nonfarm workers will do this
U.S. Department of Labor, interviews 2,500 workers backbreaking hand labor.
a year that are employed in crop farms and found
A second misconception is that large agribusiness
that 80% worked on fruit and vegetable commodi
firms employ most of the farm labor. In 2012 there
ties. Therefore, fruit and vegetable producers are the
were about 2.2 million U.S. farms and all but
most dependent on foreignborn hired labor.
60,846 of these were family farms (ERS, 2012). A
Two very important areas that producers are deal family farm is defined as one in which ownership
ing with related to labor issues are the uniqueness and control of the farm business is held by a family
of farm labor and training needed to remain of individuals related by blood, marriage or adop
competitive.
tion. All types and sizes of farms, including small
Uniqueness of Farm Labor
farms, utilize the corporate form of business organi
zation. For example, in 2007, over 46,000 farms
having less than $250,000 in sales were organized as
There are several myths or misconceptions regarding corporations and all of them were familyheld
the economic nature of agriculture and the farm corporations.
Likewise, all types and sizes of farm,
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Materials developed by The Southern Risk Management Education Center (SRMEC) are made
available through a grant from USDANIFA and authorized by Section 133 of the Agricultural
Risk Protection Act of 2000. SRMEC is a regional center of Extension Risk Management
Education established to carry out the program Partnerships for Risk Management.
including small farms, at times utilize hired farm supply and demand forces. U.S. farmers compete
labor. In 2009, 16% of the labor utilized on small with Mexican farmers and other supplying or poten
farms, $10,000 to $250,000 in gross sales, was hired tially supplying countries. If U.S. producers cannot
farm labor. These small farms would be very compete, then markets are lost to competitors such
adversely affected by limited availability of labor as Mexico, Chile, Peru, South Africa, among others.
and/or increased wage rates for hired farm labor. For ERS data shows that from 2000 to 2010 the share
farms having over $250,000 in sales, an average of of U.S. consumption of fruits and vegetables from
48% of the labor was hired. imports has increased from 42% to 48% for fruits
and from 15% to 25% for vegetables, and both
The third assumes farm laborers are paid the trends are expected to remain or increase over time.
minimum
wage and raising the wage rate will solve
the farm level shortage. Average wages for farm
Opportunities and Challenges
workers ranges from $9 to $11.09 per hour, well
above the federal minimum wage of $7.25 (Rosson, Higher U.S. wage rates make imports more price
2012; Martin, 2012a). Even with higher wage rates, competitive than domestic production. At the same
several surveys show that produce and dairy farmers time, the Secretary of Agriculture and the Secretary
continually express concerns about the availability of of Health and Human Services encourage increased
farm workers. fruit and vegetable consumption by issuing a new
set of dietary goals and nutrition guidelines for
A fourth misconception is that the labor market is Americans (hereinafter 2010 DGA). The thrust of
national in scope. Fisher and Knutson conclude that the 2010 DGA, otherwise referred to as MyPlate, is
farm labor markets have become local, as migrant to substantially reduce intake of calories and fats as
laborers who once dominated the agriculture sector part of the fight against obesity. This goal is accom
have disappeared. Hertz and Zahnizer (2013) found plished by: (1) increasing vegetable and fruit con
evidence of localized labor shortages in certain sumption to the point where their portions account
counties in California, Michigan and other states for half of the MyPlate consumption; (2) increasing
among farm labor contractors and crew leaders whole grain consumption; (3) substituting fish and
involved in fruit and vegetable production. The nuts for red meats; and (4) substituting skim milk,
demands for farm workers vary widely by commod soymilk, yogurt and cottage cheese for higher
ity. Often, a large number of workers are required fat/calorie dairy products, including fullfat milk,
for specific time periods such as harvesttime of fruits chocolate milk, cheese, butter, etc.
and vegetables. When fruits and vegetables destined
for the fresh market mature, they must be harvested The total availability of fruit (domestic production +
or they go to waste. Others are yearround such as imports exports) will need to increase by 133.3%
milk production where cows must be milked twice to meet the 2010 DGA’s recommended amount. In
or three times a day. Either way, farm labor markets addition, the total availability of vegetables (domes
are local in scope. tic production + imports exports) will need to
increase by 114% to meet the 2010 DGA’s recom
A fifth misconception is that producers are in a mended amount (Ribera, Yue and Holcomb, 2012).
market
position to simply pass on the cost of farm Some of this increase will be met through higher
ing to buyers of their production. Farm prices are level of mechanization; however, fruit and vegetable
determined nationally or globally by competitive production is dependent on hired farm labor.
Therefore, farm labor immigration policy will have a Economic Research Service (ERS). 2012. “Rural
major impact on whether the increased fruit and Labor and Education Briefing Room.” U.S.
vegetable consumption will be produced in the Department of Agriculture. Internet site:
United States or in foreign countries. www.ers.usda.gov/briefing/LaborandEducation/
FarmLabor.htm (accessed September 15, 2013).
There is widespread agreement that the current U.S.
immigration policy is broken and in need of repair. Fisher, Dennis U., and Ronald D. Knutson. 2013.
The uniquenesses of agriculture must be considered “Uniqueness of Agricultural Labor Markets.”
in making these repairs. For example, the current American Journal of Agricultural Economics
H2A farm labor program is not responsive to the 95(2): 463469.
shortterm labor needs of produce farmers. Unless a
new shortterm visa program is created, proposals to Hertz, T. 2011. “Rural Labor and Education: Farm
require that farmers everify will make the farm Labor.” Speech presented in the Economic
labor shortage problem worse. Research Service Briefing Room, Washington,
D.C.: U.S. Department of Agriculture. July 2011.
Agricultural economists have an important role to
play by informing constituent groups and the public Hertz, T., and S. Zahniser. 2013. “Is There a Labor
with objective analysis of the consequences of Shortage?” American Journal of Agricultural
proposals
to change immigration policy. If or when Economics 95(2): 476481.
a new immigration policy is enacted into law, farm
employers and employees will need to be made Horner, C. 2011. Testimony. Hearing on America’s
aware of its provisions and implications for their Agricultural Labor Crisis: Enacting a Practical
operations. Solution. Subcommittee on Immigration,
Refugees and Border Security, U.S. Congress,
As stated above, most of the hired farm labor is Senate Committee on Judiciary. October 4.
foreignborn;
therefore, immigration policy is very
important to the U.S. and to agriculture. Immigra Knutson, R. 2011. Testimony. Hearing on America’s
tion policy has been discussed in the 2012 presiden Agricultural Labor Crisis: Enacting a Practical
tial debates and will likely be debated again in Solution. Subcommittee on Immigration,
Congress at some point in the near future (Rosson, Refugees and Border Security, U.S. Congress,
2012). Agricultural producer organizations, com Senate Committee on Judiciary. October 4.
modity associations and lobbying groups have been
at the forefront of this issue for many years. Martin, P. 2012a. “Immigration and Farm Labor:
What’s Next.” Choices Magazine. Available at:
References
www.choicesmagazine.org/choicesmagazine
/policyissues/
Rosson, P. 2012. “Regional Views on the Role of
Immigrant Labor on U.S. and Southern Dairies.”
Journal of Agricultural and Applied Economics
44, 3 (August 2012): 269277.
Taylor, J. Edward, Diane Charlton and Antonio
YúnezNaude. 2012. “The End of Farm Labor
Abundance.” Applied Economic Perspectives
and Policy 34(4): 587598.
U.S. Census Bureau. “Current Population
Survey Data Tables, 2012.” Internet site:
www.census.gov/cps (accessed September 15,
2013).
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