Labor Demands and Hiring Practices of Southern Cattle-Dairy Farmers Under H-2A Program’s Current Guidelines and Proposed Modifications

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Commodities

• Animals: bovine

Practices

• Farm Business Management: labor/employment
• Sustainable Communities: employment opportunities, quality of life, sustainability measures

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.

1. Overall labor demand and hiring models: To determine and understand farm labor hiring practices of Southern cattle-dairy farms, with particular attention on whether

1. • Domestic Southern workers: the lack of participation of domestic workers in crop farms also applies to cattle and dairy operations in the South; and

1. • 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).

2. 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:

1. • 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

1. • Regional H-2A demand and utilization patterns: if justifications are influenced by regional or industry differences.

3. 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).