Do Farm Workers from Developing Countries Take Jobs from Americans?

I spent last Friday in rural North Carolina, talking with American farmers who employ farmworkers from developing countries. I wanted to get the hard facts on whether or not those workers displace U.S. citizen labor.I spoke with the North Carolina Growers Association (NCGA), the largest employer of documented temporary farm labor from poor countries under the H-2A visa program. Many of the members have been farming that beautiful countryside for generations—producing peaches, mushrooms, yams, tobacco, blueberries, and Christmas trees. I asked them how easy it was to find U.S. citizens to fill their manual agricultural jobs.I was struck mute by what I heard. I’ll let the numbers talk.When last year’s growing season ended, there were 468,000 unemployed Americans in North Carolina. The farmers of the North Carolina Growers Association had over 7,000 manual agricultural jobs to offer to those unemployed North Carolinians in 2011.

How many unemployed Americans in North Carolina applied to a manual agricultural job at the NCGA? The Association told me: 250. In accordance with federal regulations, the Association reports that it offered the job to all 250 U.S. citizen applicants. Of those, how many showed up for the first day of work? 70. Of those 70, how many chose to stay past the first few weeks of hard labor, to complete the season? The Association told me:Five.If you’re keeping score at home, this means that 0.001% of all unemployed U.S. citizens in North Carolina last year were willing to spend a full season doing hard, manual field labor. Five out of 468,000.Why weren’t unemployed North Carolinians interested in these jobs? We can rule out several explanations:

• It wasn’t that the jobs were just located in a remote area. The NCGA is a network of 700 farms that spans the state from east to west, and many are an hour’s drive from the Raleigh-Durham metro area.
• It wasn’t that pay was unacceptably low. North Carolina’s elected government has set the state minimum wage at $7.25 per hour. The jobs currently offered by the NCGA pay $9.70 per hour—a 33% premium above minimum wage. The NCGA’s jobs pay well above the average entry-level manual agricultural wage for Americans in North Carolina, which is currently $7.99.
• It wasn’t that unemployed North Carolinians didn’t hear about these jobs. All 7,000 jobs, as required byfederal regulations, were first listed at the state unemployment office, to be offered to any unemployed person who requests agricultural labor. You can go now to the website of the state unemployment office, and see some of the NCGA’s jobs publicly advertised for a two-month period. (Look at “Farming Fishing and Forestry Occupations” in “Region IV” where the sponsoring headquarters of the NCGA is located. To contact the employer, you have to register.) Beyond this, also following regulations, the jobs were advertised in local newspapers.

Then what is the reason that unemployed Americans had almost no interest in these jobs? The farmers I heard were of one voice on this: Americans want full-year work that is less physically demanding. They do not want temporary seasonal work that involves long days in the sun doing very difficult work.So the NCGA filled almost all of its manual agricultural jobs last year with documented developing-country workers who came for the season—mostly from Mexico.Mexicans prize the NCGA’s jobs because for them it is the economic opportunity of a lifetime. In my research with Lant Pritchett and Claudio Montenegro, we estimate that the typical Mexican low-skill worker can earn three times as much in the United States as in Mexico, after accounting for international price differences.  This is an engine of economic opportunity for their families back home: Mexicans working for the NCGA have travel and housing paid by the employer. They typically remit home more than 80% of the $400-500/week they earn.If you think these difficult jobs are bad for Mexicans, think about this: 85% of the NCGA’s Mexican seasonal employees last year were repeat employees. They came the previous season, and they chose to come back the following season. It is inappropriate and unfortunate that some labor advocates call H-2 visa jobs “close to slavery.”Slaves had no such choice, and would not have happily gone back to the plantation that owned them. Furthermore, the H-2 visa holders who work for the NCGA are not tied to a single farm: their visa allows them to work throughout the 700-farm network, so that there are opportunities to move if any given farm violates labor standards. Any shortcomings of the H-2 program are not the fault of migration itself; they can be fixed by fixing the program.Kris Kobach, perhaps America’s leading anti-immigrant activist, seeks to remove over five million immigrantscurrently in the United States during the next presidential administration. Many of them are low-skill agricultural workers. To justify this policy, Kobach, a lawyer, confidently states an economic theory he invented:

“If you want to create a real job for a U.S. citizen tomorrow, deport an illegal alien today. It actually works.”

That is, Kobach believes that there is a one-for-one perfect substitution between unauthorized foreign labor and U.S. citizen labor. This theory is wildly at odds with the evidence, suggesting that Kobach is either irresponsibly ignorant or deliberately deceptive in his statements regarding the economics of the U.S. labor market. There is no one-for-one substitutability of foreign workers and U.S. workers in American farm jobs, where 25% of the labor force is unauthorized. Almost none of the jobs that the NCGA offered last year received any interest from Americans, and if NCGA farmers had chosen not to fill them with authorized H-2 workers, they could easily have filled all of the same jobs with unauthorized workers. The NCGA tried to find Americans, as it was required to, and it could not.I believe that Americans are generally smart and pragmatic, and can look at these plain facts and rise above fear salesmen’s histrionics—to a higher plain of understanding. The best evidence is that H-2 agricultural laborers from developing countries complement, rather than substitute for, U.S. workers.