UC Food and Agriculture Blogs

Will importing workers lead to importing crops?

Rising farm labor costs could shift more U.S. crop production to Mexico

A dwindling and aging agricultural workforce, coupled with higher labor costs, have added pressure on U.S. farms over the past decade. A recent study by University of California agricultural economists Alexandra Hill and James Sayre explores these changing trends in U.S. and Mexican farmworker demographics and the potential implications for U.S. farms.

They found that the incentives to enter the United States under the H-2A visa program for farmwork far outweigh the incentives to immigrate for farm work without proper work authorization. However, because these H-2A workers come at a steep cost to employers, this could mean that several crops with high labor costs may increasingly move production to Mexico in a quest to reduce costs.

Over the last two decades, several trends have led to a shortage of domestic crop workers in the United States. A major contributing factor is that fewer immigrant farm workers are migrating to the United States from Mexico. This trend is generally driven by a declining share of Mexican citizens working in agriculture as the country's economy moves into manufacturing and service industries, coupled with declining birth rates, rising education levels, and increases in U.S. immigration enforcement.

The H-2A program — which provides legal authorization for foreign workers to engage in temporary work on U.S. farms — is the one source of foreign crop labor that is on the rise. Employers are required to pay H-2A workers either the local minimum wage or the local H-2A minimum wage (called the adverse effect wage rate, or AEWR), whichever is higher. The H-2A AEWR is often four to five times higher than the average farmworker wages in Mexico, leading to a substantial wage gap that helps pull Mexican workers into U.S. farm work.

“While the high costs associated with the H-2A program will pull in workers, they may also push farms out of the United States,” said Hill, assistant professor of Cooperative Extension at UC Berkeley.

This is due to the fact high H-2A wages are reducing the profitability of U.S. farms that employ H-2A workers, particularly in states such as California and Washington, which have a greater number of high-labor crops, such as fruits and nuts. Mexico's lower labor costs and suitable climate for fruit and vegetable crops allow the country to have an increasing competitive advantage compared to states like California, which have increasingly high AEWRs.

Mexican production of some of these high-labor crops has increased dramatically over the last two decades: From 2003 to 2022, the value of blueberry production grew 2,600-fold, raspberries grew 140-fold, and strawberries 13-fold. Large increases in exports of these crops from Mexico to the United States have occurred over this same period, confirming that high-labor crops are at a greater risk of losing market share to Mexico.

To learn how the changing demographics of U.S. and Mexican farmworkers could affect U.S. agricultural production, read the full article by Alexandra E. Hill and James E. Sayre: “As Mexican Farmworkers Flock North, Will U.S. Farms Head South?” ARE Update 28(1): 9–12. UC Giannini Foundation of Agricultural Economics, online at https://giannini.ucop.edu/filer/file/1730229662/21163 or in Spanish at https://giannini.ucop.edu/filer/file/1732133779/21191/.

ARE Update is a bimonthly magazine published by the Giannini Foundation of Agricultural Economics to educate policymakers and agribusiness professionals about new research or analysis of important topics in agricultural and resource economics. Articles are written by Giannini Foundation members, including University of California faculty and Cooperative Extension specialists in agricultural and resource economics, and university graduate students. Learn more about the Giannini Foundation and its publications at https://giannini.ucop.edu/.

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Desert Organic Research and Food Safety Workshop set for Dec. 4 in Holtville

The "Advances in Southwest Desert Agriculture Research, Organic Production and Food Safety" workshop is scheduled for Dec. 4 in Holtville. This event will showcase cutting-edge research and practical organic farming strategies tailored to California's unique desert environment.

The symposium will feature presentations from University of California Cooperative Extension advisors and other experts.

The agenda covers a range of critical topics, including insect pest management in low desert agriculture, weed management strategies for guayule seedlings, summer cover crops for soil health and disease management, integrated pest management for onion diseases, predicting sugar beet cyst nematode suppressiveness, and microbial risk assessment of soil amendments in organic romaine lettuce.

“These presentations will provide valuable insights into improving desert vegetable production, irrigation efficiency, and food safety practices specific to our region,” said co-organizer Jimmy Nguyen, University of California Cooperative Extension food safety and organic production area advisor for Imperial and Riverside counties.

“This symposium presents an excellent opportunity to learn about the latest research findings directly applicable to Imperial County agriculture, gain practical knowledge to enhance your agricultural practices, and network with fellow professionals and researchers in the field.”

The UC Cooperative Extension team aims to foster the exchange of ideas and promote the advancement of agricultural practices in the community.

“We encourage everyone involved in growing crops in Imperial County to attend this informative event and contribute to the ongoing dialogue on agricultural innovation in the Southwest desert region,” Nguyen said.

The workshop will be held at Barbara Worth Country Club, 2050 Country Club Dr, Holtville, CA 92250. Register at https://surveys.ucanr.edu/survey.cfm?surveynumber=43924.

For more information, please contact UC Cooperative Extension advisors Jimmy Nguyen, cgnguyen@ucanr.edu; Philip Waisen, pwaisen@ucanr.edu; Ali Montazar, amontazar@ucanr.edu; or Oli Bachie, obachie@ucanr.edu; or call (442) 265-7700.

 

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