Academic journal article
By Devadoss, Stephen; Luckstead, Jeff
Journal of Agricultural and Applied Economics , Vol. 40, No. 3
A major concern with immigrants coming into the United States is that they adversely affect domestic workers through job competition and wage depression. We study the displacement and wage reduction effects of immigrants in California vegetable production, which is labor intensive, and 95% of the farmworkers in California are immigrants. Our findings show that this concern is not valid in vegetable production because the addition of one new immigrant displaces only 0.0123 domestic workers, and wage reduction is inconsequential. But one immigrant worker increases the vegetable production by $23,457 and augments the productivity of skilled workers, material inputs, and capital by $11,729.
Key Words: employment displacement, immigrant labor, vegetable production, wage effect
JEL Classifications: J43, J61
According to the 2002 Census of Agriculture, about 554,000 U.S. farmers employed 3 million immigrant farmworkers and paid $18.6 billion in wages and salaries (National Agricultural Statistics Service [NASS]), which underscores the importance of these workers to U.S. farm production and a potential labor cost increase if these workers are not available. The National Agricultural Worker Survey (NAWS) documents that in 2001-2002, 78% of workers in U.S. farm production were immigrants, and 75% were from Mexico.1 The same survey reports that 80% of the newly hired agricultural labor force is from Mexico, of which 96% are unauthorized (NAWS). These numbers are even higher for California because of its contiguous location to Mexico (Martin, 2007a).
The previously mentioned statistics indicate that without immigrant laborers, several critical farm tasks could not be completed. Numerous news media reports have elaborated the acute labor scarcity in many parts of the country. For example, the Wall Street Journal reports that, in 2006, about 20% of agricultural products were not harvested nationwide, and the losses in 2007 were estimated to be even higher, particularly in California. Rural Migration News provides a detailed and specific list of these shortages and how they adversely affected crucial cultivational operations, which resulted in heavy losses. A large number of acres of vegetable crops were not harvested, and fruits in numerous orchards went unpicked because of a labor shortage, particularly in the western states.2 As a result, farm groups are one of the strongest allies of the current comprehensive immigration reform because if the number of undocumented workers dwindles, many growers will be affected and go out of business, particularly those growing labor-intensive fresh produce. Although several immigration bills were introduced and contentiously debated in the Congress, none were passed, including the "AgJob" provision that allows 1.5 million new guest workers, even though farm groups strongly supported this provision (see U.S. Department of Labor  for various provisions of the AgJob bill). The major concerns are whether to grant illegal immigrant the legal status, which opponents have labeled amnesty and U.S. workers' apprehensions about losing their jobs to immigrants.
California has one of the largest agricultural labor markets in the country, accounting for 36% of farmworkers (Mason and Martin). The Migrant and Seasonal Enumeration Study by the Bureau of Primary Care's Migrant Health Program reports that 1 . 1 million seasonal farm laborers are working in California agriculture (Mines); of those, 440,000 are actually employed year-round; that is, only about 40% of farmworkers are employed throughout the year, or every full-time employment is filled by 2.5 workers (Martin, 2007b). Forty percent of these laborers work in the leading five agricultural counties in California: Fresno, Monterey, Kern, Tulare, and Ventura. Immigrants are the primary source of farm workforce for labor-intensive agriculture, such as fruit and vegetable production, in much of the western United States, particularly in California because of its close proximity to Mexico (Taylor). …