COULD PRES TRUMP'S DEPORTATIONS DRIVE UP AG WAGES?
Feb. 28, 2017
Across America's orchards and crop fields, a shrinking supply of migrants has already driven pay up faster than in the broader workforce. President Donald Trump's immigration policy may turbocharge that trend.
Wages for U.S. fieldworkers rose 36 percent over the past decade through the conclusion of last year's harvest in October, compared with 27 percent among non-farm employees, government data show. Reducing the supply of labor wouldn't just cause pay gains to accelerate: The Trump administration's expanded deportations for undocumented immigrants could put some growers out of business if the actions aren't accompanied by increases in workers available through legal guest-worker programs.
"You would see operations just shut down," said Zaid Kurdieh, who employs about two dozen legal immigrants at Norwich Meadows Farm in central New York state. "Even if you fill the gap with legal workers, the wages will jump just to get people to work," said Kurdieh, whose 80-acre organic farm supplies a wide range of vegetables to farmers' markets in New York and New Jersey.
While policy shifts on taxes and health care are months or years from taking effect -- much less having a broad influence on the world's largest economy -- farms and their workers may provide a more real-time look at the impact of a signature Trump action. Other industries with a significant proportion of undocumented workers include construction and hospitality, with one study suggesting that unauthorized immigrants contribute about 3 percent of private-sector gross domestic product.
Trump's immigration plan, outlined in memos on Tuesday, would add 15,000 border-enforcement agents to enforce immigration laws and expand the categories of undocumented immigrants targeted for expulsion. The administration is arguing the moves are necessary to fulfill campaign promises to restore the integrity of national borders, while critics call it a detailed blueprint for the mass deportation of 11 million undocumented immigrants.
The extent of actual deportations and the system's capacity to handle them is unclear. Officials haven't given targets for the number of expulsions, after more than 2.7 million during former President Barack Obama's eight-year term. Homeland Security Secretary John Kelly vowed on Thursday that there would be no "mass" deportations.
While much of the U.S. farm economy is mechanized, fresh produce and dairy remain heavily dependent on human labor. Immigrants, both legal and unauthorized, have supplied that labor for generations. American farms have already faced worker shortages from Obama's stepped-up deportations and a decline in arrivals from Mexico, traditionally the main source of migrants.
About a quarter of the U.S. farm workforce, more than 300,000 people, don't have valid immigration papers, according to a 2009 survey by the Pew Hispanic Center. Other studies suggest the number may be more than 1 million and as much as 70 percent of all workers. The sector is already struggling: The Agriculture Department said Feb. 7 that farm profits this year will fall for the fourth consecutive year, the first time that's happened since the 1970s.
An immigration policy focused on closing the border would shift as much as 61 percent of U.S. fruit production to other countries and send jobs to nearby nations such as Mexico, in part because wage costs would make U.S. foods less competitive, according to a 2014 study commissioned by the American Farm Bureau Federation, the largest U.S. farmer group.
Cutting the total unauthorized workforce by roughly half, meanwhile, would push wages for undocumented and legal guest farm workers as much as 40 percent higher than they would have been otherwise over a 15-year period, according to a 2012 study by the U.S. Department of Agriculture.
Field worker wages increased by 4 percent to an average of $12.59 an hour in the reference week of Oct. 9-15 from a year earlier, according to the most recent USDA data. That's ahead of the 2.7 percent pace for nonfarm employees in Labor Department figures for the same month, though the average wage for that group was $25.90.
A sudden jump in deportations would quickly throw agricultural wage scales out of whack, said Ethan Harris, Bank of America Merrill Lynch's head of global economics in New York.
"There's no way to get people out of the city and into the country to pick crops on short notice without a very dramatic increase in wages," Harris said. "The tougher question is to figure out whether there's a bigger disruption to these workers leaving," such as difficulty harvesting crops.
That's the situation farmers are trying to avoid, said Zippy Duvall, president of the American Farm Bureau Federation.
"We're really anxious to have a seat at the table and have a serious conversation about farm labor," Duvall said in an interview on Bloomberg Radio. So far, that's been complicated by the lack of an agriculture secretary, he said. Prospective USDA chief Sonny Perdue, who Trump announced as his nominee Jan. 19, hasn't yet had his confirmation hearing.
A crackdown may not have a great effect on consumer prices, Duvall said, because retailers may simply substitute imports for domestic goods. But U.S. agriculture, and the rural communities that supported Trump in his bid for the White House, would be upended by policies that would no longer make America the first choice for migrant-dependent crops, he said.
"The farm labor discussion is around whether or not our country wants to import our labor or whether they want to import their food," he said. "I think the American people want to eat food that's grown in America."