Downgrading the 'Farm Labor Crisis'
Senior Editor, CNBC.com
It looks like we’re making some progress in debunking the "Great Farm Labor Crisis of 2012."
In his response to my columns on farm labor, Craig J. Regelbrugge, co-chair of Agriculture Coalition for Immigration Reform, argues that the data I’ve marshaled to show that this is a boom time for American farms paints an inaccurate picture because it lumps commodities such as corn, soybeans, wheat and rice — which can be grown on large-scale farms with a high-degree of mechanization — in with more labor-intensive fruit and vegetable crops.
This distinction is important—and a sign of progress. What Regelbrugge is revealing is that we’re not facing a farm-labor crisis at all. At the very worst—that is, if we give Regelbrugge the benefit of the doubt on the facts in dispute—we might be facing a shortage of workers on a smaller subset of American farms. That’s a far cry from the idea that farms “nationwide” are “reeling” from a labor shortage.
Regelbrugge, however, fails to prove even this more limited claim. Here's why.
There’s not one piece of data in his column supporting the idea of a labor shortage for fruit- and vegetable-pickers. Not one single fact or figure indicating a shortage. (Read more: More Data on The Phony Farm Labor Crisis)
Regelbrugge points out that last year, farm income outside of corn, cattle, hogs and soybeans rose 6.15 percent. That’s a very respectable growth rate. What’s remarkable is how farmers managed to prevent very much of this growth from getting passed on to farm workers, who saw wages rise just 2 percent in 2011.
If there really was a lack of available farm workers, we would expect wages to be rising rapidly. The higher wages would attract more workers into farming. Sure, there might be some time lag, but the problem would not persist. That’s the way markets work: prices adjust to restore an equilibrium between supply and demand.
Regelbrugge and others want us to believe that farm labor is an exception to the usual rules of economics. We’re just supposed to accept the idea that higher wages will not work for farming the way they do for every other economic sector. No one has yet explained to me why labor markets would uniquely fail for farming. (Read more: California Farm Labor Shortage 'Worst It's Ever Been'?)
All of the data we have are inconsistent with the idea of a farm labor shortage. What seems to be happening, instead, is that some farmers are finding that they cannot attract workers at the wages they are offering. But rather than raise wages to attract a larger supply of workers, they seek a public policy solution to allow them to hire more workers without raising wages.
- by CNBC.com senior editor John Carney
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