US Farm Employment and Farm Workers (2024)

The Mexican Immigrant Population Is Declining, 1980–2021

The farm labor market matches millions of workers with often-seasonal jobs. All labor markets perform the “R” functions of recruitment, remuneration, and retention, but the farm labor market performs these functions differently. Recruitment often relies on farm labor contractors; many workers are remunerated under piece rate wage systems that guarantee a minimum wage but allow fast workers to earn more than this minimum if they pick more trays or bins. Unions have few contracts with US farms and represent few farm workers, but they have significant political influence.

Farm worker earnings of about $17 an hour in 2022 were 60 percent of average nonfarm earnings of $28, reflecting the rapid growth in farm worker earnings since 2015 that has narrowed the farm-nonfarm wage gap. Reasons for the narrowing wage gap include a stable demand and a shrinking supply of farm workers, states raising their minimum wages and requiring overtime pay for farm workers, and more employers turning to H-2A guest workers who must be paid a higher Adverse Effect Wage Rate.

There have been significant organizing efforts to help the largely immigrant farm workforce overcome economic disparities and exploitation. While these efforts gained significant momentum in the latter half of the 1900s, some of them have waned since then, such as membership in unions. However, new farm labor advocacy efforts have emerged.

In light of rising farm labor costs, there is now a race in the fields between labor-saving machines, H-2A guest workers, and imports. Adjustments to rising labor costs vary by commodity. Some commodities seem poised to remain in the US and mechanize, including raisin and wine grapes as well as blueberries. Commodities such as apples and strawberries are likely to utilize more H-2A guest workers until mechanization is perfected. Imports of commodities such as fresh tomatoes and raspberries from lower-wage countries are likely to increase as US production shrinks.

Key Farm Labor Data Sources

There are several sources of data on hired workers in US agriculture. The main data sources are the Quarterly Census of Employment and Wages (QCEW), the Farm Labor Survey (FLS), the Current Population Survey (CPS), and the National Agricultural Workers Survey (NAWS). In each data set, the definition of farm worker and survey reliability vary, making the farm labor market akin to a room of unknown size and shape. Each data source opens a window into the room that varies in size and clarity or reliability. There are shortcomings and advantages to each of the datasets.

For example, the QCEW and FLS provide only aggregate measures of employment and wages; they do not contain any information on the individual farm employees. The QCEW is an administrative data set that captures employment and earnings data from all employers whose employees qualify for unemployment insurance, including both direct-hire employees and employees of farm labor contractors. H-2A employees in some states, such as Michigan and Florida, do not qualify for UI payments, so they are excluded, while states like California include H-2A employees. As such, the QCEW reflects only non-H-2A employees in some states but reflects both H-2A and non-H-2A employees in other states. Moreover, the QCEW does not provide any details about the hourly wage rate that is paid to employees.

The FLS, a survey of crop and animal farmers, does not include employees who work for farm labor contractors. The FLS is supposed to provide “the basis for employment and wage estimates for all workers directly hired by U.S. farms and ranches (excluding Alaska).”2 The FLS does, however, provide a measure of the gross hourly earnings of employees, which includes payments in kind, such as a side of beef, so it does not necessarily reflect the average hourly wage of farm employees. The FLS also includes H-2A visa employees in the wage and employment measures and does not focus entirely on US-based employees. The FLS has suffered from low response rates in recent years, creating concerns about its statistical reliability.

The CPS samples households in the United States and gathers information on each member of every sampled household. The CPS uses a 4-8-4 rotation, where people are surveyed for four consecutive months, exit the sample for eight months, and then re-enter the sample for another four months. During the months when the respondents exit the sample (in their fourth and eighth months), they are asked additional questions pertaining to their earnings. The CPS collects demographic data, such as birthplace and gender, and provides data on hourly wages. However, the CPS has relatively small farm employee sample sizes (about 700 per year) to provide any geographically representative statistics. The CPS provides weights that allow for estimates of the total workforce.

The NAWS is a nationally and regionally representative data set that provides representative statistics at six publicly available regions and twelve restricted-access regions for individuals with access to confidential data. According to the US Department of Labor (DOL),

The primary purposes of the NAWS are to monitor the terms and conditions of agricultural employment and describe the demographic characteristics of hired crop workers . . . NAWS findings have been used for occupational injury and health surveillance, estimating the number and characteristics of crop workers and their dependents, and program planning.3

The NAWS collects hourly wage data and collects information on a wealth of other categories, Including demographics and some types of sensitive data, such as undocumented status. The NAWS fills many of the gaps in terms of the statistical reliability of individual-level characteristics, but it does not permit estimates of the total labor force. As such, the NAWS provides some information about marginalized farm employees that other data sources do not provide.

Employment

The Bureau of Labor Statistics (BLS), which uses data from the CPS described in “Key Farm Labor Data Sources” to estimate the number of workers, reported average employment of 850,000 self-employed farmers and unpaid family members and 1.5 million wage and salary workers in 2016 (see Table 1). The average employment of farmers and family members declined by 5 percent between 2006 and 2016, while the average employment of hired workers rose by 23 percent. BLS projects stable hired worker employment through 2026, meaning that hired workers will continue to account for two-thirds of average employment in US agriculture.

Farm Workers

The National Agricultural Workers Survey (NAWS) has been interviewing 1,500 to 3,000 non-H-2A workers employed on US crop farms each year since 1989. It finds that, on average, crop workers are aging, settled in one place, and working two hundred days a year for one farm employer. H-2A guest workers, who are not interviewed in the NAWS, are younger, male, and almost 95 percent Mexican. There are no reliable data on who works in animal agriculture, but most observers believe that livestock workers are older and less Hispanic than crop workers.

NAWS Demographics

The National Agricultural Workers Survey (NAWS) finds that two-thirds of crop workers were born abroad, almost all in Mexico, including half from west-central Mexican states such as Jalisco and Michoacán, 30 percent from northern states such as Sinaloa, and a quarter from in southern Mexican states such as Oaxaca (see Figure 4). There is a declining share of US farm workers from northern Mexican states and a rising share from southern Mexican states.

NAWS Employment

Farm Labor Markets

Labor markets are exchanges where employers find workers and workers find jobs. These exchanges can be physical, as when workers wait outside home improvement stores to be hired by contractors, when people visit job fairs, or virtual, as when applicants review job offers online and apply. Workers search for jobs and employers screen applicants, employers motivate their employees to work and seek to retain the best workers, functions often summarized as the three Rs of labor markets: recruitment, or matching workers with jobs; remuneration, or paying wages and benefits to motivate workers to provide effort in exchange for reward; and retention, to retain workers.7 Each of these three Rs operates differently in farm labor markets relative to most other sectors of the economy.

Recruitment

Most nonfarm employers develop job descriptions that lay out the qualifications required to perform a job, advertise for candidates, and screen and interview applicants to find the best person to fill a particular job. Farmers often use job ads and interviews to recruit skilled and professional workers, but rarely to recruit seasonal farm workers unless they are hiring H-2A guest workers, where ads seeking US workers are required. Farmers often hire groups of workers, asking for a crew of twenty to forty workers.

Crews of Spanish-speaking seasonal workers are matched with farm jobs by bilingual intermediaries, a crew boss employed by the farmer or an independent farm labor contractor (FLC). Recruitment often occurs through social networks, with incumbent workers asked to bring their friends and relatives into the crew. Crews include families from the supervisor’s Mexican hometown, which may ensure loyalty. Dissatisfied workers usually find it easier to switch to another crew rather than voice complaints about a supervisor who favors or harasses particular workers.

FLC establishments, nonfarm businesses that bring workers to farms on farm labor contracts, are murky because federal and state laws require many people to be involved in recruiting, transporting, and supervising farm workers to obtain licenses, while unemployment insurance laws record only FLC establishments that pay UI taxes. For example, California has 1,500 UI-registered FLC establishments but almost 10,000 licensed FLCs and FLC employees.

FLC establishments should benefit both employers and workers, but often benefit mostly employers. A farmer who needs workers seasonally, and workers who need several seasonal jobs to achieve sufficient earnings, can each pay small fees to the FLCs who match workers and jobs. In practice, FLC establishments have long been associated with labor market problems rather than efficiencies, an example of fissuring the workplace in ways that disadvantage vulnerable workers.8

There are many arrangements to get farm work done, from paying a fixed price per acre or ton to harvest a crop to paying an hourly wage to workers and an additional overhead or commission to the FLC to cover non-wage costs, including payroll taxes and business costs that range from recruitment to toilets and equipment as well as profits. Commissions are typically 30 to 40 percent of FLC revenue, with workers compensation insurance costs of 15 to 20 percent of revenue often the largest single FLC cost. FLCs compete with each other to win work for their employees on farms, and farm operators sometimes ask FLCs to lower their commissions in order to win their business. Commissions are a sensitive and opaque topic. There are many arrangements to get farm work done, from paying a fixed price per acre or ton to harvest a crop to paying an hourly wage to workers and an overhead or commission to the FLC. FLC establishments cover non-wage costs, including payroll taxes and business costs that range from recruitment to toilets and equipment as well as profits, and are typically 30 to 40 percent of FLC revenue, with workers compensation insurance costs of 15 to 20 percent of revenue often the largest single FLC cost.

A farm with a $10 million wage bill knows that each 1 percent FLC commission is $100,000. An FLC who wants a 40 percent commission but is offered 38 percent must decide whether to accept the lower commission to provide jobs for employees while covering costs and generating profits. Farm operators are often in a stronger economic position than FLCs, encouraging some FLCs to accept lower commissions and compensate by underpaying workers or not paying all required social security and unemployment insurance taxes or workers compensation premiums. Media reports regularly describe FLCs who accept low commissions and pay lower wages to employees to keep their businesses viable.

There is no database of FLC commissions, so there is no easy way to analyze data to determine the relationship between commissions and labor law violations. On the other hand, there are certification efforts to help lawful or good FLCs to identify themselves to farmers seeking good FLCs. Stronger Together, the Equitable Food Initiative, and other NGOs train and certify FLCs who satisfy their standards under the theory that employers want good FLCs and can now find them more easily.9

Remuneration

Retention

Retention, the third key function of labor markets, is also different in agriculture. Some workers are employed by one employer for their entire career, as with a worker who is employed year-round on a dairy farm, while others may have several employers a year and dozens over their farm work career.

Agriculture offers both year-round and seasonal jobs, and farm operators hire workers directly and indirectly via contractors. Farmers sometimes hire year-round workers directly and offer them housing and other benefits. Seasonal worker policies are different. Most seasonal workers are on the farm only a few weeks or months, making retention a question of how to keep them until work is completed and how to induce them to return next season.

The crew supervisors who hire and monitor seasonal workers also lay them off at the end of the season. Many farms have payroll systems that allow them to identify the most productive workers, but few acknowledge such workers in any public way at the end of the season or promise to rehire them next season. One description of typical attitudes to obtain seasonal farm workers uses the analogy of ensuring sufficient irrigation water, where farmers can work collectively to build more dams to maximize the supply of water available to all rather than investing individually in drip irrigation systems to stretch limited water supplies on their farms. Similarly, farmers often work collectively to maximize the pool of seasonal workers available to agriculture rather than investing in their own workforces.

Selecting guest workers from lower-wage countries is the ultimate way to maximize the supply of seasonal workers. Mexican workers earn at least ten times more in US agriculture than in Mexican agriculture, ensuing that there are more workers seeking H-2A jobs than are available. Farmers invest significant sums to persuade Congress to give them easier access to farm guest workers, just as they invest to ensure that more water is available to irrigate crops. However, Mexico’s workforce is undergoing an agricultural transformation, and US employers will eventually have to recruit labor from farther away or mechanize (see Figure 10).

Mexico’s Workforce Is Transitioning Out of Agriculture

Unions

Workers exchange effort for reward in workplaces that are regulated by labor laws and influenced by unions. Agriculture was exempted from many labor laws and social protections, from minimum wage and child labor laws to social security, when they were enacted in the 1930s under the theory that “agriculture is different.” Since then, federal labor laws have been revised to end many agricultural exemptions, but agriculture remains federally exempt from union organizing and overtime laws, and child labor is regulated differently.

States have also filled in missing labor rights and sometimes granted more rights to farm workers under state laws than are available to nonfarm workers under federal laws, as with California’s Agricultural Labor Relations Act. Despite the most favorable union law in the United States, fewer California farm workers are represented by unions today than they were before 1975, when Cesar Chavez and the grape boycott were almost daily news items.

History

Farm worker unions have been described as “much ado about nothing.”13 Hired farm workers often receive low wages and work only seasonally, and they have been hard to organize into unions because many are employed by labor contractors and are seeking better nonfarm jobs.

Economists sometimes distinguish between exit and voice labor markets. Exit labor markets offer similar work across workplaces, as with picking peaches or working in fast-food restaurants. Dissatisfied workers typically exit such workplaces for similar jobs elsewhere rather than speak up or voice their dissatisfaction, making it hard for unions to organize workers. Even after winning recognition, farm worker unions have found it hard to raise wages and benefits because of the layering of the farm labor market; the crew supervisors and contractors who are often considered employers in the eyes of workers may not set the wage. Finally, farm workers are dispersed across many farms, making it costly for unions to organize and serve them.14

There have been many efforts to organize farm workers, but there are no links between past and present farm labor unions. The first farm worker unions, such as the Industrial Workers of the World, or Wobblies, before World War I, had radical leaders who wanted to replace the employer-employee wage system with worker-run cooperatives. During the 1930s, the Communist-led Cannery and Agricultural Workers Industrial Union wanted to eliminate capitalist employers. The clash of extremes between radical unions and conservative growers in agricultural areas often led to violence that was suppressed by local authorities linked to farm employers opposed to “outsider” agitators.15

UFW and FLOC

Farm Worker NGOs

Numerous community groups aim to help farm workers without representing them in formal procedures before federal and state agencies. These groups can be short-lived, disappearing when key leaders leave or funding is reduced. The Mixteco Indigena Community Organizing Project (MICOP) sometimes files charges on behalf of farm workers with the Agricultural Labor Relations Board (ALRB) and other enforcement agencies, but does not represent farm workers on any farm and draws complaints from farm employers for acting like a union without filing paperwork with federal and state agencies.

Many farm worker NGOs received a lifeline during and after the COVID pandemic by administering federal and state programs that provided aid to, inter alia, farm workers. The US Department of Agriculture (USDA) in October 2022 made $670 million in grants to 15 nongovernmental organizations (NGOs) to provide $600 grants to farm, meatpacking, and grocery store workers.24 The United Farm Workers (UFW) was the lead organization that provided assistance to other NGOs seeking to help farm workers, and the UFW Foundation received $98 million to distribute the money. Organizations distributing grants to farm workers can keep up to 15 percent of the amount received for administrative costs.

The Pineros y Campesinos Unidos del Noroeste (PCUN) advocates on behalf of farm workers in Oregon. After a boycott of NORPAC Foods, a cooperative of 240 growers, PCUN, and NORPAC reached a Framework for Managing Farm Labor Relations in 2002 with “clear and enforceable guidelines that provide [farm workers] with an opportunity to elect PCUN to represent them. If they do elect to join PCUN, it also establishes a framework for contract negotiations with the participating NORPAC member-growers.”25

The Coalition of Immokalee Workers (CIW) is an NGO that urged growers to raise the piece rate for picking mature green tomatoes by a penny a pound, almost doubling the piece rate from 40 to 45 cents for each 32-pound bucket to 70 to 75 cents.26 The CIW exposed labor contractors who enslaved some workers and, after growers refused to raise piece rates, the CIW mounted boycotts of the fast-food restaurants that buy many of the mature green tomatoes.

Beginning with Yum Brands (Taco Bell) in 2005, fast-food restaurants began to sign agreements with the CIW that offered their tomato suppliers an additional 1.5 cents a pound for tomatoes picked under the CIW’s Fair Food Program (FFP), with one cent going to pickers and a half cent going to growers to cover their additional administrative costs. The Florida Tomato Growers Exchange, which represents the twelve major tomato producers, signed onto the FFP in 2010.27 The US acreage of mature green tomatoes is declining as imports of vine-ripened tomatoes increase; 60 percent of US fresh tomatoes were imported in 2023.

There are also labor certification programs that aim to distinguish good farm employers, that is, farm employers who comply with labor laws and involve farm workers in decision-making. The Equitable Food Initiative (EFI), launched by Oxfam America in 2012 with the support of Costco and other stakeholders, aims to be an international program that covers farms and workers in all commodities in North America.28

EFI has 326 performance indicators grouped into four categories: cross-sectional, labor, food safety, and environmental.29 Each category includes three to ten items labeled as critical, major, and minor, and all critical indicators are audited once a year. For example, cross-sectional standards include compliance with federal, state, and local labor laws (major), labor management cooperation to develop a leadership team on the farm (critical), and nonretaliation against workers who participate in EFI or report violations of EFI standards (critical). Labor standards range from compliance with worker health and safety regulations to fair compensation. Workers are to be informed of the terms and conditions of employment and “an accurate definition of the piece rate system” (minor). EFI certification requires compliance with all indicators.

Once a farm is in compliance with EFI standards, a third-party auditor issues a certificate of compliance that allows the farm to put the EFI label, “Responsibly Grown, Farmworker Assured,” alongside its own label on its produce. EFI staff are funded by foundation and corporate grants to publicize the program, train leadership teams on farms, and work with growers and buyers. At the end of 2023, there were 62 North American farms certified by EFI.30

Fair Trade USA certifies fair-trade products to enable sustainable development and to empower communities that produce food and other commodities. Fair Trade USA

audits and certifies transactions between US companies and their suppliers to guarantee that the farmers and workers producing Fair Trade Certified goods are paid fair prices and wages, work in safe conditions, protect the environment and receive community development funds to empower and uplift their communities.31

This triple win for people, the planet, and profit is supported by supermarkets such as Kroger and Walmart, which pay a premium for Fair Trade USA-certified products.

The Fair Trade USA agricultural production standard includes six modules dealing with worker empowerment, fundamental rights at work, wages and working conditions, environmental sustainability traceability, and internal management. Some of these standards are subjective, such as “fair wages” or plans to improve health and safety, although participating farms must show improvement from year to year. Farms are audited, and products that satisfy the agricultural production standard can include the fair-trade label.32 Fair Trade USA reported 125 certified produce farms in 2024.33

Machines, Migrants, and Imports

There are three major ways to provide fresh fruits and vegetables to Americans: produce them in the US with machines or migrant guest workers or import crops from abroad. Rising wages and the shrinking number of US farm workers encourages mechanization and more migrants, while lower wages abroad have led to more imports.

Mechanization

Mechanizing hand tasks in agriculture often requires three steps: a systems perspective, cooperation between biologists and engineers, and trial-and-error refinements. Mechanization is rarely a case of machines seamlessly replacing workers because a farming system must usually change for machines to replace hand workers. Tall fruit trees can be replaced by dwarf trees whose limbs are trained to grow on wires as in a vineyard, and such fruiting walls make it easier for machines to identify and pick ripe fruit (see Figure 12).

Apples on Vertical Trellises May Be Harvested by Robots in the Future

The second key to labor-saving mechanization is cooperation between biologists and engineers. Scientists must often modify plants so that engineers can develop cost-effective harvesting systems. For annual crops such as leafy vegetables, one key to mechanization is uniform ripening, so that 90% or more of the crop can be harvested in one pass through the field.34

Many fruits are picked multiple times, from apples and blueberries to oranges and peaches, and the first pick often yields 50 to 75% of the total harvest. However, the remaining fruit may make the difference between profit and loss, giving growers incentives to pick all marketable fruit. Raising the share of the total crop that can be picked during the first harvest makes machine harvesting more cost effective.

Crops such as strawberries are often picked twice a week and 40 to 50 times during the season. Workers pick strawberries directly into the clamshells in which they are sold, pushing a light wheeled cart that holds a tray with eight one-pound clamshells. Putting slow-moving conveyor belts in front of pickers increases hand worker productivity by eliminating the need to carry full trays to collection stations at the end of rows. Mechanizing the harvest of fragile strawberries requires sophisticated and expensive machines that to date are too slow to compete with hand workers.

The third mechanization challenge is to refine labor-saving machines in a trial-and-error process to develop commercially viable systems. The first machines are rarely those that dominate a decade later because of refinements that are made in response to experience. Dust, uneven ground, and moisture can damage sensitive equipment, which is why experimentation often leads to more durable machines that can adapt to ever-changing field conditions.

Farmers are cautious about buying expensive machines if farm workers are available. Many machines developed in labs do not work as well as anticipated in the field, so that early adopters may buy a machine that does not work and have to pay hand workers to pick the crop, raising costs. Harvesting aids that make hand workers more productive may reduce incentives to develop fully mechanized systems. For example, the conveyor belts that travel in front of workers harvesting heads of lettuce raise the bar for a lettuce harvesting machine.

There is a final economic difference between hand and machine work. The costs of using hand workers are variable, meaning that farmers do not pay wages if weather or disease ruin the crop or if prices are so low that the crop is not harvested. A purchased machine, on the other hand, becomes a fixed cost that must be paid for whether there is a crop to be harvested or not. Some firms provide machine harvesting as a service, but they must set prices that reflect the possibility of having nothing to harvest.

Guest Workers

The second way to produce fresh fruits and vegetables in the United States is to recruit guest workers from lower wage countries. The H-2A program has since 1952 allowed US farmers who anticipate too few US workers to be certified by the DOL to recruit and employ guest workers to fill seasonal farm jobs. In order to receive DOL certification, farm employers must satisfy three major criteria. First, DOL must certify that the employer tried and failed to recruit enough US workers. Second, after being certified, employers must recruit workers abroad, pay worker travel expenses to and from their home countries, and offer free and approved housing to H-2A workers while they are employed in the US and daily transportation between this housing and the work place.35

Third, the employer must offer and pay the higher of the federal or state minimum wage, the prevailing wage rate, or the Adverse Effect Wage Rate (AEWR) to H-2A and US workers in similar employment. The AEWR is normally the highest of these wages and ranged from almost $14 to over $18 an hour across states in 2023 (see Figure 13). Adding at least $5 an hour for transportation, housing, and other expenses makes the total cost of H-2A workers at least $19 to $23 an hour, which is more than the cost of US workers who are not provided with transportation and housing. H-2A guest workers provide labor insurance because they are tied to their US employer by contracts, and are in the US an average of six months.36

2023 Adverse Effect Wage Rates

The H-2A program expanded after the 2008-09 recession as fewer unauthorized Mexicans entered the US for fear that, after paying thousands of dollars in smuggling fees, they would be unable to find jobs. In 2000, over half of US crop workers were unauthorized, including a quarter who were newcomers, meaning that they were in the US less than a year before being interviewed. After 2010, the unauthorized share of crop workers fell to 40 percent, and the share of newcomers dropped to 2 percent.37

Reduced Mexico-US migration was mirrored in the rising number of H-2A guest workers. The number of farm jobs certified to be filled by H-2A workers increased from fewer than 100,000 in FY13 to 372,000 in FY22, and as of this writing was on track to top peak Bracero admissions of 450,000 by 2025 (see Figure 14). Not all of the jobs certified to be filled by H-2A workers are in fact filled by such workers, and some H-2A visa holders are able to fill two or more certified jobs. The number of H-2A visas issued is typically 80 percent of the number of jobs certified, about 300,000 in FY22.

H-2A Jobs Certified and Visas Issued, FY05-22

There are about 1.5 million full-time-equivalent jobs in US agriculture, including 1.1 million in crops and 400,000 in animal agriculture.38 H-2A workers are in the United States an average of six months, so 300,000 H-2A workers filled about 15 percent of the FTE jobs in US crop agriculture in 2023. Most of the states certify fewer than 10,000 employees per year, and a few account for the majority of H-2A employment (see Figure 15). During fiscal year 2023, nine states had more than 10,000 H-2A jobs certified, accounting for two-thirds of all jobs certified. Florida led the nation with 14 percent of the jobs certified (52,000 jobs). The next leading states were California with 11 percent (41,000 jobs), Georgia with 10 percent (38,000 jobs), Washington with 9 percent (36,000 jobs), and North Carolina with 7 percent (26,000 jobs) (Table 5). Together, the top five H-2A employment states had nearly 200,000 H-2A jobs certified and accrued an estimated H-2A wage bill of nearly $3 billion (see Table 2 and Figure 12).

Should the rapid expansion of the H-2A program be welcomed or feared? Answering this question requires an understanding of how the program works and the options to change it, including proposals to end the requirement that employers try to recruit US workers, to allow farmers to provide H-2A workers with a housing allowance of $1 to $2 per hour worked rather than providing them with free housing, and freezing or eliminating the AEWR.

Second, is DOL certification effective to prevent H-2A workers from adversely affecting US farm workers? H-2A workers are generally younger than US workers and selected for their ability to do the job, making them 15 to 30 percent more productive than US workers in terms of bins of apples or oranges picked per hour or day. How can US workers be protected if H-2A workers are more productive, willing to work long hours if needed, and loyal to their employer because they cannot leave for another job?

Third, does the availability of H-2A workers slow labor-saving mechanization or do H-2A workers act as a bridge to mechanization? Do US growers have any obligation to guest workers and US workers who may be displaced after mechanization or imports substituting for US production?

Farm Labor Costs

Real farm wages are rising. After accounting for inflation and converting into 2023 dollar values, farm wages have risen by more than 20 percent over the past decade (top red line in Figure 16). Without accounting for inflation, farm wages have increased by more than 40% since 2010 (bottom gold line in Figure 16). Farm wages have been rising at a faster rate than wages in the rest of the economy, suggesting that labor supply pressures are more pronounced in the agricultural sector than in other sectors. The growth in US-based hired crop farm wages averaged 4.8 percent per year between 2012 and 2022, but only 3.0 percent in all other occupations.

Adverse Effect Wage Rates

Foreign-born employees with low levels of formal education tend to have low reservation wages and are often viewed competitors for US jobs.39 The US government implemented a minimum wage for H-2A workers called the Adverse Effect Wage Rate (AEWR) to help mitigate adverse effects from the employment of temporary foreign workers in the agricultural sector. H-2A workers must be paid the highest of the state or federal minimum wage, the prevailing wage, the state’s AEWR, or the relevant collective bargaining agreement wage. In February 2022, the DOL published a rule that designated the USDA’s Farm Labor Survey (FLS) as the basis for most AEWRs for the Standard Occupational Classification (SOC) codes 45-2041, 45-2091, 45-2092, 45-2093, 53-7064, and 45-2099. All other SOC codes are assigned an AEWR based on the Bureau of Labor Statistics’ Occupational Employment and Wage Statistics (OEWS) survey. In 2023, the USDA’s FLS AEWRs ranged from a low of $13.67 in the southeastern part of the country to a high of $18.65 in California.

Some states, such as Michigan, had their FLS AEWR increase by as much as 13% in 2023 when the average increase over the previous decade was around 5% per year. Industry sources claim that the AEWR increases are unpredictable and are at a point where the economic viability of domestic specialty crop production is being threatened. The new DOL rule affects serves to increase the wages of H-2A employees performing higher-skilled jobs, such as construction and truck driving. Figure 17 below shows a comparison of some higher-skilled AEWRs under the FLS and OEWS prior to the DOL rule being implemented. These figures reveal that managers who would have earned around $15 under the FLS AEWR would have had their wages increase to $45, while construction workers, first line supervisors, and truck drivers would have had their wages rise from about $15 to $25.

Imports

The third adjustment to provide Americans with fresh fruits and vegetables is to import more from lower-wage countries. Over 60 percent of US fresh fruit, and 40 percent of US fresh vegetables, are imported (see Figure 18). Between 2008 and 2020, the value of imported fruits, vegetables, and horticultural crops rose from about $28 billion to more than $40 billion in 2022.

Mexico is the source of almost half of US fresh fruit imports, led by avocados, and two-thirds of the fresh vegetable imports, led by tomatoes (see Figure 19). The US-imported FVH commodities have been worth an average $15 billion a year from Mexico in recent years.

Mexico is the leading supplier of imported tomatoes, avocados, raspberries, bell peppers, and strawberries, many of which are produced under protected cultures such as greenhouses, screenhouses, and plastic-covered tunnels (see Figure 20). The next five leading countries are Colombia, Canada, Chile, Guatemala, and Brazil, each with roughly 5 to 10 percent of the US import market.

There are several reasons for the upsurge in Mexican exports of horticultural commodities to the United States, including free trade agreements such as NAFTA-USMCA and an improving infrastructure that can truck Mexican produce to the United States quickly using the same highways that are used to transport goods made in Mexico to the United States. Farm labor costs in Mexico are 10 to 20 percent of US farm labor costs, and Mexican export farms have latecomer advantages, such as producing high-value fruits and vegetables under protective structures such as greenhouses and shade houses rather than in open fields, what the US Department of Agriculture calls controlled environment agriculture (CEA), which allows Mexican farmers to extend their export seasons so that they increasingly compete with US-produced fruits and vegetables, especially in the southeastern states (see Figure 21).

Some fruits and vegetables produced in Mexico are destined primarily for the United States. For example, up to half of the tomatoes, lettuce, watermelons, avocados, and strawberries that are grown in Mexico, and up to 75 percent of the asparagus, broccoli, and cucumbers grown in Mexico, are exported to the United States. Some of these commodities arrive in the United States every month of the year, such as tomatoes, while others are more seasonal, such as strawberries that arrive in the United States between December and April.

Conclusions

The United States has a large and complex farm labor system that involves older, white, and US-born farm operators hiring younger, nonwhite, and noncitizen hired workers. There are two million US farms, and 100,000 to 500,000 rely on hired workers to produce crops and livestock. Agriculture is a 90-10 industry, meaning that relatively few large farms account for most farm employment and output, so that the largest 10,000, or 10 percent of all US farm employers, account for 80 to 90 percent of farm employment. Large farms hire workers directly and also rely on nonfarm businesses such as farm labor contractors to bring workers to their farms.

Almost three-fourths of US crop workers employed were born in Mexico, including up to a million who are not authorized to work in the United States and 300,000 who are legal H-2A guest workers. The unauthorized Mexican-born workers arrived in their twenties and thirties in the 1990s and early 2000s and are now settled in one place and aging out of seasonal farm work. The fresh blood in the farm workforce are H-2A guest workers, 90 percent of whom are Mexican men in their twenties and thirties.

The farm labor market matches workers with jobs, motivates them to work, and retains or rehires the best workers. The 3 Rs of recruitment, remuneration, and retention are different in agriculture. Farm operators often rely on crew supervisors or FLCs to recruit crews of workers in the United States and abroad. Many harvest workers are motivated to work fast by piece rate wage systems that pay workers according to the number of bins or trays picked. Relatively few farm employers have formal systems to evaluate and promote their employees, relying instead on a pool of workers to be available when needed to fill seasonal jobs.

Farm labor costs have been rising rapidly as the supply of US workers shrinks faster than the demand for farm workers, states raising their minimum wages, and more farmers hiring H-2A guest workers and incurring housing and transport costs. The options to provide Americans with US-produced fresh fruits and vegetables include the mechanization of hand-labor tasks and more H-2A guest workers. Alternatively, imports of fresh fruits and vegetables could continue to increase, reflecting the comparative advantage of countries with lower wages.