Progress report for LS23-387
Project Information
This project is a comprehensive analysis of the Southern livestock (i.e., cattle and dairy) farms’ labor demand, hiring options and practices, and overall farm business sustainability. Our in-depth analysis evaluates small and medium livestock farms’ labor hiring alternatives: the adequacy of family labor, the availability/reliability of domestic workers, and the relative need for foreign workers–especially contractual H-2A workers.
The role of H-2A foreign labor is assessed as whether it is: mere supplier of incremental/supplementary workers, optional/potential competitors of local farm work, or inevitable labor inputs. Based on farm needs, the assessment of the H-2A program patronage trends are analyzed under two scenarios: current program guidelines vs. proposed modifications (e.g., potential cost-effective program alternatives).
Empirical and anecdotal evidence establish that U.S. farms operate under a tightening labor market where the domestic workforce is unwilling to take on farm jobs. In recent years, farms increasingly relied on the H-2A program for sourcing contractual foreign workers. H-2A utilization trends indicate that crop farms accounted for 80-90 percent of H-2A workers hired since 2010. Conversely, livestock farms accounted for only 4-8 percent. This is partially attributed to the livestock production cycle: although many ranch operations are labor intensive, the industry’s need for year-round labor cannot be filled by seasonal, temporary H-2A work contracts.
Recently, the Farm Workforce Modernization Act (FWMA) was passed by the US Congress and is awaiting Senate’s approval. If enacted, FWMA will introduce H-2A program amendments, including lengthening workers’ initial stay to 3 years. This project will investigate if FWMA’s proposed amendments will encourage cattle-dairy farms to hire more H-2A workers. Moreover, we will validate whether livestock farms’ historically-low H-2A employment can be attributed to factors outside the H-2A program (e.g., labor market dynamics, structural, demographic, and behavioral conditions).
This project offers an important regional perspective in understanding the cattle-dairy farms’ labor hiring predicament. A Midwestern perspective is introduced in our project, through our academic and farmer collaborators from Wisconsin—home of 23 percent of all U.S. dairy farms and second-largest milk producer. A comparative analysis of Southern and Midwestern models will shed light on important regional differences in market dynamics, behavioral, economic, and social conditions. This variation is necessary to tease out the relative importance of each factor in determining reliance on H-2A labor.
We propose a comprehensive data collection on important facets of the labor conditions through four state-of-the-art techniques, implemented at both regions: Focus groups and discussions with farmers will establish the breadth and depth of labor-related concerns and parameters. Survey responses will provide quantitative support to this project’s assertions and conclusions. Choice experiments will reveal farm operators’ preferences for H-2A program attributes and quantity economically the most relevant factors. A whole livestock farm business analysis–using project data and additional operating information from participating farms–will be conducted under a simulation-and-optimization framework. Collectively, our methods will produce many policy sounding results that directly address sustainability goals of productivity, profitability, and farmers’ quality of life; while indirectly promoting the environmental stewardship component through labor-input substitution strategies.
- Overall labor demand and hiring models: To determine and understand farm labor hiring practices of Southern cattle-dairy farms, with particular attention on whether
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- Domestic Southern workers: the lack of participation of domestic workers in crop farms also applies to cattle and dairy operations in the South; and
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- Regional South versus Midwest: there are significant regional differences (South versus Midwest) in labor preferences (skilled versus unskilled labor profiles) and preferences for labor sources (relative dependence on family, domestic, and foreign workers).
- Role of H-2A labor in cattle-dairy operations: To understand cattle and dairy farmers’ historically low patronage of H-2A workers and clarify whether such trends are:
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- H-2A program-related: outside the seasonal employment issue, potential H-2A employers have reservations with such program stipulations on minimum wage limits (H-2A’s adverse effect wage rates) as well as housing and other required fringe benefits requirements for workers. In addition, we will investigate whether the program’s processing time may affect workers’ prompt availability to work and other cost/non-cost considerations; and
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- Regional H-2A demand and utilization patterns: if justifications are influenced by regional or industry differences.
- Effect of proposed FWMA amendments to H-2A labor utilization in cattle-dairy farms: To determine the comparative regional responses to proposed FWMA introducing H-2A program amendments. Specifically, we will determine if FWMA will generate potential increases in H-2A patronage among Southern cattle farmers (and compared to their Midwestern counterparts’ reaction to same program amendments).
Cooperators
- - Producer
- - Producer
- - Producer
- - Producer
Research
SURVEY
The research team is currently conducting a large-scale survey of cattle and dairy farmers in Wisconsin, North Carolina, and Georgia. In October 2023, the research team finalized the development of a survey instrument in both paper and electronic form. The electric instrument was programmed using Qualtrics. The paper (or mail) survey was distributed by the Survey Research Center at UW-River Falls in January 2024. A parallel open-ended survey is also being distributed to cattle farmers by producers’ associations in Georgia and North Carolina. While data collection is still underway, to date we have collected a total of 382 responses.
CHOICE EXPERIMENT
A survey instrument with choice experiment questions was developed January-February 2024. The IRB application was submitted in March 2014 to collect in-person data from farmers in Texas during August and October 2024, dates when two conferences will occur. The Choice experiment and survey were developed based on Farm Bill proposals, which were revised in Fall 2023.
CASE STUDIES
Case farms for the regional (South and Midwest) models will be selected. Farm business and operating data will be collected and used in developing the simulation-optimization models to discern farm labor hiring and management strategies coping with differentiated regional labor markets.
The large-scale survey data collection is currently ongoing and is expected to be completed this spring. Extensive analyses of survey data will commence this summer. In addition, choice experiments data will be collected and available in the Fall semester. Once these two data generation methods are completed, this project will release outreach materials and undertake dissemination activities.
Moreover, case study analyses will also be conducted in the second year. This method will provide qualitative data that will supplement and complement the quantitative data collected from the large-scale survey and choice experiments.
Meanwhile, an underlying research on wage issues crucial to this project's research goals has been completed. This produced a journal article currently under review at an academic journal and presented at the annual meeting of NC-1177 (a regional agricultural finance hatch research group).
There were also several other non-academic publications that lay out the motivations of this project's research thrust and providing important background on the issues covered by this project.
Sectoral and Regional Concentration of H-2A Patronage
The South as the Nation’s Primary Regional Employer of H-2A Labor
Social and Business Implications of the 2023 Increase in Adverse Effect Wage Rates
New Rules for the Calculation of H-2A Workers’ Wages
Educational & Outreach Activities
Presentations at academic colloquia, conferences
Participation Summary:
SOUTHERN SARE PROJECT REPORT
First Year - April 1, 2023 to March 31, 2024
SARE Project LS23-387:
“Labor Demands and Hiring Practices of Southern Cattle-Dairy Farmers under H-2A Program’s Current Guidelines and Proposed Modifications”
COMPLETED AND ONGOING PROJECT ACTIVITIES
SURVEY
The research team is currently conducting a large-scale survey of cattle and dairy farmers in Wisconsin, North Carolina, and Georgia. In October 2023, the research team finalized the development of a survey instrument in both paper and electronic form. The electric instrument was programmed using Qualtrics. The paper (or mail) survey was distributed by the Survey Research Center at UW-River Falls in January 2024. A parallel open-ended survey is also being distributed to cattle farmers by producers’ associations in Georgia and North Carolina. While data collection is still underway, to date we have collected a total of 382 responses.
PROJECT TEAM MEETINGS
The project team members held two virtual meetings. On August 21, 2023, the team discussed details of implementation plans for the producers’ surveys (in the South – North Carolina and Georgia – and Midwest (Wisconsin and Minnesota) and choice experiments (in Texas).
The team also welcomed a new addition to the team – Dr. William Secor, Assistant Professor at the Department of Agricultural and Applied Economics of the University of Georgia. Dr. Secor assumed the position of UGA’s livestock extension specialist in February 2023 when the project was in its final stages of approval at SARE. Dr. Secor will assist in the implementation of project activities in Georgia given his close association with the leadership of the state’s dairy and cattle associations as well as key industry contact persons.
The project team met again on February 16, 2024 to check on updates on the ongoing Southern and Midwestern dairy/cattle producers’ surveys and the choice experiments.
PROJECT WEBSITE
A project website was developed and launched in the Fall semester of 2024 through the efforts of University of Georgia graduate student Maoyong Zheng. The website is designed as a repository of project outputs (academic and outreach publications and presentation materials) as well as updates/relevant news releases integral to the project’s issues. The project’s website can be accessed at
https://site.caes.uga.edu/cattleh2alabor/
OUTPUTS (OUTREACH AND ACADEMIC PUBLICATIONS)
Outreach Publications/Popular Press
C. L. Escalante, A. Gutierrez-Li, and S. Acharya. “Reforming the H-2A Guest Farmworker Visa Program: Sectoral Coverage Expansion and Workers’ Path to Permanent Residency.” Southern Ag Today. March 6, 2024. Available at https://southernagtoday.org/2024/03/06/reforming-the-h-2a-guest-farmworker-visa-program-sectoral-coverage-expansion-and-workers-path-to-permanent-residency/
Gutierrez-Li, A. “What is the TN Visa Program?” Southern Ag Today. February 14, 2024. Available at https://southernagtoday.org/2024/02/14/what-is-the-tn-visa-program/
C. L. Escalante. “Who’s using H-2A and where?” Southeast Farm Press. October 23, 2023. Available at https://www.farmprogress.com/farm-policy/who-s-using-h-2a-and-where-
C. L. Escalante. “Sectoral and Regional Concentration of H-2A Patronage.” Southern Ag Today. Farm Management/Finance Wednesdays. October 18, 2023. Available at https://southernagtoday.org/2023/10/18/sectoral-and-regional-concentration-of-h-2a-patronage/
C. L. Escalante and S.K. Acharya. “Louisiana, One of the States with the Most H-2A Workers.” Louisiana Farm Bureau News. July 5, 2023. Available at https://lafarmbureaunews.com/news/2023/6/30/louisiana-one-of-the-states-with-the-most-h-2a-workers.
Gutierrez-Li, A. “New Rules for the Calculation of H-2A Workers’ Wages.” Southern Ag Today. June 28, 2023. Available at https://southernagtoday.org/2023/06/28/new-rules-for-the-calculation-of-h-2a-workers-wages/
C. L. Escalante and S.K. Acharya. “South emerges as primary regional employer of H-2A labor.” Southeast Farm Press. June 28, 2023. Available at https://www.farmprogress.com/farm-life/south-emerges-a-primary-regional-employer-of-h-2a-labor.
C. L. Escalante and S.R. Acharya. “The South as the Nation’s Primary Regional Employer of H-2A Labor.” Southern Ag Today. Farm Management/Finance Wednesdays. June 21, 2023. Available at https://southernagtoday.org/2023/06/21/https-southernagtoday-org-2023-06-21-the-south-as-the-nations-primary-regional-employer-of-h-2a-labor/
C. L. Escalante. “Social and Business Implications of the 2023 Increase in Adverse Effect Wage Rates.” Southern Ag Today. Farm Management/Finance Wednesdays. March 1, 2023. Available at https://southernagtoday.org/2023/03/01/social-and-business-implications-of-the-2023-increase-in-adverse-effect-wage-rates/
Third-Party Press Articles (Interview quotes, research citations)
Cabrera, E. “Across the Southern border: The future of the H-2A visa program in Georgia.” CAES Newswire. January 17, 2024. Available at https://newswire.caes.uga.edu/story/10353/h-2a-program.html
Cabrera, E. “Across the Southern border: How U.S. immigration policies affect agriculture.” CAES Newswire. January 4, 2024. Available at https://newswire.caes.uga.edu/story/10335/immigration-policies.html
Grinspan, L. “Increased worker wages cost Ga. farmers an estimated $100 million in 2023.” Atlanta Journal Constitution. December 1, 2023. https://www.ajc.com/news/georgia-news/increased-worker-wages-cost-ga-farmers-an-estimated-100-million-in-2023/LHH7SDGZT5EBDDROFNDHSAUFDY/
Cabrera, E. “Across the Southern border: Migrant labor on Georgia farms.” CAES Newswire. November 30, 2023. Available at https://newswire.caes.uga.edu/story/10321/migrant-labor.html.
Grinspan, L. “Expanded Rights Coming for Georgia’s migrant farmworkers.” Atlanta Journal Constitution. November 1, 2023. Available at https://www.ajc.com/news/georgia-news/expanded-rights-coming-for-georgia-migrant-farmworkers/MTTK4EL22BCF7OW5PUN3CG6MGE/
Academic Journal Articles:
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- Acharya, S.R. and C.L. Escalante. “Does the Adverse Effect Wage Rate Adversely Affect H-2A Hiring Decisions?” Submitted to a special issue of Agricultural Finance Review.
- Escalante, C.L. and C. E. Taylor. “Protecting H-2A Workers’ Rights and Welfare” Submitted to Choices.
PRESENTATIONS
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- Contributed paper, NC 1177 Regional Hatch Group in Agricultural Finance, Annual Meeting, Federal Reserve Bank of Atlanta, S. R. Acharya (presenting author) and C.L. Escalante. “Does the Adverse Effect Wage Rate Adversely Affect H-2A Hiring Decisions?” October 13, 2023.
- Escalante, C.L (Panelist and Speaker), Conference on Economics of Inequity in Agriculture, Food, and Environmental Systems, sponsored by AAEA and AJAE, University of Minnesota. “Economics of Inequity: Issues Affecting the Socially and Financially Disadvantaged.” May 24, 2023.
- Escalante, C.L. (Keynote Speaker) 11th annual Rod Nilsestuen Legacy Event, University of Wisconsin – River Falls, “Immigration, Farm Labor, and Health Repercussions.” March 23, 2023.
PLANS FOR SECOND YEAR (April 1, 2024 to March 31, 2025)
CHOICE EXPERIMENT
A survey instrument with choice experiment questions was developed January-February 2024. The IRB application will be submitted in March 2014 to collect in-person data from farmers in Texas during August and October 2024, dates when two conferences will occur. The Choice experiment and survey were developed based on Farm Bill proposals, which were revised in Fall 2023.
CASE STUDIES
Case farms for the regional (South and Midwest) models will be selected. Farm business and operating data will be collected and used in developing the simulation-optimization models to discern farm labor hiring and management strategies coping with differentiated regional labor markets.
PROJECT OUTREACH AND DISSEMINATION
As survey and choice experiment results are available and analyzed, the team will embark on various outreach efforts by reaching out to local/state industry associations and other conference and seminar venues. Project materials will also be widely disseminated electronically (listserv emails, project websites, and other means) to supplement in-person and virtual discussions of the project and its findings.