For decades, farms in the United States have relied heavily on low-wage foreign workers — mainly from Mexico — to work their fields. In 2006, 77 percent of all agricultural workers in the United States were foreign-born. (And half of those foreign workers were undocumented immigrants.) All that cheap labor has helped keep down U.S. food prices, particularly for labor-intensive fruits and vegetables.
But that labor pool is now drying up. In recent years, we've seen a spate of headlines like this from CNBC: "California Farm Labor Shortage 'Worst It's Been, Ever'." Typically, these stories blame drug-related violence on the Mexican border or tougher border enforcement for the decline. Hence the call for new guest-worker programs.
But a new paper from U.C. Davis offers up a simpler explanation for the labor shortage. Mexico is getting richer. And, when a country gets richer, its pool of rural agricultural labor shrinks. Not only are Mexican workers shifting into other sectors like construction, but Mexico's own farms are increasing wages. That means U.S. farms will have to pay higher and higher wages to attract a dwindling pool of available Mexican farm workers.
"It's a simple story," says Edward Taylor, an agricultural economist at U.C. Davis and one of the study's authors. "By the mid-twentieth century, Americans stopped doing farm work. And we were only able to avoid a farm-labor crisis by bringing in workers from a nearby country that was at an earlier stage of development. Now that era is coming to an end."
Taylor and his co-authors argue that the United States could face a sharp adjustment period as a result. Americans appear unwilling to do the sort of low-wage farm work that we have long relied on immigrants to do. And, the paper notes, it may be difficult to find an abundance of cheap farm labor anywhere else — potential targets such as Guatemala and El Salvador are either too small or are urbanizing too rapidly.
So the labor shortages will keep getting worse. And that leaves several choices. American farmers could simply stop growing crops that need a lot of workers to harvest, such as fruits and vegetables. Given the demand for fresh produce, that seems unlikely.
Alternatively, U.S. farms could continue to invest in new labor-saving technologies, such as "shake-and-catch" machines to harvest fruits and nuts. "Under this option," the authors write, "capital improvements in farm production would increase the marginal product of farm labor; U.S. farms would hire fewer workers and pay higher wages." That could be a boon to domestic workers — studies have found that 23 percent of U.S. farm worker families are below the poverty line.
In the meantime, however, farm groups are hoping they can fend off that day of reckoning by revamping the nation's immigration laws. The bipartisan immigration-reform proposal unveiled in the Senate on Monday contained several provisions aimed at boosting the supply of farm workers, including the promise of an easier path to citizenship.
Taylor, however, is not convinced that this is a viable long-term strategy. "The idea that you can design a guest-worker program or any other immigration policy to solve this farm labor problem isn’t realistic," he says. "It assumes that there's a willingness to keep doing farm work on the other side of the border. And that's already dropping off."
-- The paper, titled "The End of Farm Labor Abundance," by J. Edward Taylor, Diane Charlton, and Antonio Yúnez-Naude.
-- Here's a presentation (pdf) from Taylor and Charlton.
-- Here's the Senate's immigration-reform proposal.