Evidence of a Changing Farm Labor Supply(And a Preview of Future Research)
Zach Rutledge
University of California, Davis
November 27th, 2018
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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
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2017 News Clip
https://www.youtube.com/watch?v=LtE6qW4ugho
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Media Coverage
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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
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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)
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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)
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Employment Statistics - QCEW/CES
Source: Quarterly Census of Employment and Wages and EDD Current Employment Statistics
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Employment Statistics - EDD
Source: Martin et al. (2016); Khan, Martin, and Hardiman (2004)
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NAWS Statistics
Source: National Agricultural Workers Survey
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NAWS Statistics
Source: National Agricultural Workers Survey
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NAWS Statistics
Source: National Agricultural Workers Survey
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NAWS Statistics
Source: National Agricultural Workers Survey
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NAWS Statistics
Source: National Agricultural Workers Survey
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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
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EDD Wage Statistics
Source: California Employment Development Department
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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...
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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)
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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)
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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
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Rural Mexicans Performing Less Farmwork
Mexican Rural Household Data (ENHRUM)
Source: Charlton and Taylor (2016)
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Evidence-What is Causing the Decline in Farm Workforce?
Source: Charlton and Taylor (2016)
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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)
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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
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Reduced Farmworker Migration
Probability of Migrating to a US Farm
Source: Fan et al. (2015)
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Reduced Farmworker Migration
Source: Fan et al. (2015)
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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
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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
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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
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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
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Upcoming Survey of California Farmers
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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
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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
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Thank You!
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