Evidence of a Changing Farm Labor Supply (And a Preview of ... workgroup/VegCropsPT_201… ·...

Evidence of a Changing Farm Labor Supply(And a Preview of Future Research)

Zach Rutledge

University of California, Davis

November 27th, 2018

Zach Rutledge (U.C. Davis) Farm Labor Supply November 27th, 2018 1 / 34

Outline

1 Media reports of farmworker shortages in California

2 Trends in California farm labor supply3 2 studies documenting declines in the farm labor supply

Charlton and Taylor (2016)

A Declining Farm Workforce: Analysis of Panel Data from Rural Mexico

Fan et al. (2015)

Why Do Fewer Agricultural Workers Migrate Now?

4 My dissertation research with Ed Taylor and our upcoming survey ofCalifornia farmers


2017 News Clip

https://www.youtube.com/watch?v=LtE6qW4ugho


Media Coverage


Media Interview Quotes

”The shortages never end, there just aren’t enough workers.”- California farmer

“Every day in the summertime we have to leave some crops behindbecause there’s not enough labor to harvest it all.” - California farmer


CA Farm Bureau Survey 2017

55% of respondents reported some type of labor shortage

Of those who employ seasonal workers, 69% report shortages

Some quotes

“This year, workers were very scared to move around. The newpolitical climate is creating high level concern in the workforce anddefinitely lower availability of workers in high traveled and public areasfor those of us in more urbanized areas.” – San Diego County farmer

“Workers are afraid of immigration enforcement and deportations, sothey are heading back to their countries.” – Tulare County farmer

Source: California Farm Bureau Federation (2017)


California Agricultural Production

California relies heavily on farm labor

Largest agricultural producer in the US

$50 billion in 2017

1/3 of US vegetables

2/3 of US fruits

Fruits and vegetables require a lot of labor to produce and harvest

Source: California Department of Food and Agriculture (2018)


Employment Statistics - QCEW/CES

Source: Quarterly Census of Employment and Wages and EDD Current Employment Statistics


Employment Statistics - EDD

Source: Martin et al. (2016); Khan, Martin, and Hardiman (2004)


NAWS Statistics

Source: National Agricultural Workers Survey


NAWS Statistics



NAWS Statistics



NAWS Statistics



NAWS Statistics



Back-of-the-Envelope Calculations

If Social Security numbers are representative of the farm workforce...

Combining number of workers and work days in 2001 and 2014

1,087,000 workers x 175 days = 190 million days of farm work829,000 workers x 190 days = 158 millions days of farm work

18% decline in days of farm work

A decrease in labor supply could lead to higher wages


EDD Wage Statistics

Source: California Employment Development Department


Farm Labor - Some History

US farmers have relied on an abundant supply of workers comingfrom rural Mexico since the Bracero Program (1942-1964)

Lots of workers have kept wages low

California farmers have become reliant upon this cheap source of labor

But things are slowly changing...


The Transition out of Farm Work (1990-2010)

1. Economies develop2. Workers move out of farm work, and nations start to importfarmworkers

Source: Taylor and Charlton (2018)


The Transition out of Farm Work (1990 - 2010)

1. Mexico is developing2. Starting to import workers from Central America

Source: Taylor, Charlton, and Yunez-Naude (2012)


Charlton and Taylor (2016)A Declining Farm Workforce:Analysis of Panel Data from Rural Mexico

Use rural household survey data from Mexico (ENHRUM)

Panel of data on everyone in household between 1980 and 2011

Identifies whether or not each individual worked on a farm in each year

They find that rural Mexicans are increasingly less likely to work inagriculture

They identify some factors contributing to this and how they are likelyto affect the farm labor supply


Rural Mexicans Performing Less Farmwork

Mexican Rural Household Data (ENHRUM)

Source: Charlton and Taylor (2016)


Evidence-What is Causing the Decline in Farm Workforce?

Source: Charlton and Taylor (2016)


What is driving the decline?

Expanding economy in Mexico

Increased demand for nonfarm labor in Mexico (service/industrial)

Higher educational attainment

Decreasing birthrates among rural Mexicans (down from 6 to 2)

Rising value of Mexican Peso (lowers the value of migrating)


Fan et al. (2015)Why Do Fewer Agricultural Workers Migrate Now?

Use NAWS data (National Agricultural Workers Survey)

Identify a negative trend in farmworker migration

Follow-the-Crop Migrants = work on 2 different farms that are at least75 miles apartShuttle Migrants = Travel from home (either in Mexico or in the US)to a US farm at least 75 miles away from their home

Identify that farmworkers are increasingly less likely to migrate to USfarms

Identify some factors that are contributing to the negative trend inmigration


Reduced Farmworker Migration

Probability of Migrating to a US Farm

Source: Fan et al. (2015)


Reduced Farmworker Migration

Source: Fan et al. (2015)


What is Causing the Decline?

Structural changes in the US economy and political environment

Changes in farmworker demographics are playing an increasing role

Immgration reform and increased border enforcement =⇒Fewer young, single workers migrating to the US =⇒Older, more settled workforce

More farmworkers having US children


Quick Summary

Mexico is developing

Expanding nonfarm economyHigher educational attainmentLower birthrates

=⇒ Decreased probability that rural Mexicans work on a farm

Changing demographic composition of the farm workforce

=⇒ Fewer farmworkers migrating to US farms

There is some evidence of a changing farm labor supply

Farmers will eventually have to adapt to this


What’s Next?

Dissertation work with Ed Taylor

2 chapters left to write

1 How are

Reductions in the farm labor supplyIncreased labor costs

affecting agricultural production and farmer profits in California

2 To what extent are US non-farm sectors pulling workers away fromagricultural work


Survey of California Farmers

Working with Bryan Little and Sara Neagu-Reed(California Farm Bureau Federation)

Online survey

Questions will ask about

Labor ShortagesH-2A employmentFarm labor contractor useChanges in crops grownRecent use of labor-saving technologiesChanges in cultivation practices


Upcoming Survey of California Farmers


Chapter 1 - Research Goals

Look at statistical relationship between labor shortages and thevarious farming practices

Quantify how much labor shortages and higher wages are drivingchanges in farming practices

Identify what is the dominant response mechanism among farmers

Quantify how much decreases in labor supply affect farmer profits

No results yet


Chapter 2 Research Preview

How much are other US sectors pulling workers out of the farm labor force?

(1) (2)(log) Crop Employment (log) Farm Employment

(log) Permits -0.0893** -0.107***(0.0376) (0.0359)

N 861 1357

County Fixed Effects Yes Yes

Year Fixed Effects Yes Yes

Standard errors in parentheses are clustered at the county level* p < .1, ** p < .05, *** p < .01

Preliminary Findings:A 10% increase in construction leads to a 1% decline in farm labor supply


Thank You!


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