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USDA: millions fewer illegal aliens wouldn't devastate agriculture (farm labor supply economic models, guest workers)

The table at [1] is from a Department of Agriculture study (link) showing the impacts of two different immigration scenarios:

* One with an increased guest workers program. The increase would be due to changes to the H2A program as mandated by the AgJOBS bill.

* One in which the "unauthorized" labor supply has fallen by 5.8 million people. That would be due to the use of eVerify as mandated by the Legal Workforce Act (HR 2885). The vast majority of those the USDA calls "unauthorized" are illegal aliens.

Both projections are over a time period of 15 years.

Compare the impacts shown in the table to the scaremongering by growers, as chronicled on the crops rotting in the fields page. To hear growers tell it the sky would (almost literally) fall without a plentiful supply of illegal labor. Per the tall tales of growers (repeated by a sympathetic media) millions of acres of prime farmland would lie fallow, we'd all be eating lead-soaked vegetables grown in China, and the whole U.S. economy would collapse.

Yet, in the USDA's "worse case" scenario, GNP would be reduced by around 1%. That would work out to around $150 to $200 billion, which is definitely a lot of money.

However, what their study isn't taking into account is that losing that much farm labor would spur developments in mechanization and research into new ways of growing food [2]. We can send a man to the moon, but we're stymied by figuring out less labor- and resource-intensive ways to grow strawberries?

Also:

Like many CGE models, the USAGE model achieves a longrun equilibrium in which all labor and capital resources are nearly fully employed. Thus, the simulations reported here do not apply to the current economic environment, in which about 8.1 percent of the U.S. workforce is unemployed (as of April 2012). Instead, the model results describe hypothetical longrun scenarios in which the U.S. economy is much closer to full employment and has an unemployment rate of about 5 percent.

There's also the non-economic impact that millions fewer illegal aliens would have on the U.S.: the Mexican government would have less of a power base inside the U.S., the illegal immigration-supporting establishment would have been chastised, there would be lower social spending, and in general all the very many impacts of illegal immigration would have been reduced.

Mechanization and modernization are the way to go, not just throwing more foreign serf labor at the problem. You don't get there by giving growers more cheap labor, you get there by tightening their labor supply and forcing them to improve their processes.

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[1] See the study for the terms they're using in the table:

Changes in labor supply affect output, exports, employment, and earnings in the long run

Variable

Scenarios

 

Increased farm

labor supply

Decreased unauthorized labor supply

Assumed impact on labor supply

+ 156,000 temporary nonimmigrant, foreign-born farmworkers

- 5.8 million unauthorized

workers, farm and nonfarm

 

Percent change

Percent change

Fruit, tree nuts, vegetables, nurseries

   

Output

+ 1.1 to 2.0

–2.0 to –5.4

Exports

+ 1.7 to 3.2

–2.5 to –9.3

Other agricultural sectors

 

 

Output

+ 0.1 to 1.5

–1.6 to –4.9

Exports

+ 0.2 to 2.6

–0.3 to –7.4

 

Percent change

Percent change

Employment in agriculture

+ 1.7

–3.4 to –5.5

U.S.-born & foreign-born, permanent resident

– 5.7

+2.4 to 4.0

Foreign-born, not a permanent resident

+ 32.4

–34.1 to –38.8

Earnings per job in agriculture

– 4.4

+ 3.9 to 9.9

U.S.-born & foreign-born, permanent resident

– 3.4

+ 3.3 to 7.5

Foreign-born, not a permanent resident

– 10.0

+ 13.6 to 39.8

 

 

Percent change

Nonfarm employment of U.S.-born and other permanent residents

Negligible effects on

nonfarm economy

 

Lower paying occupations

+2.2 to 3.2

Higher paying occupations*

–0.5 to –0.7

Nonfarm earnings per job of U.S.-born and other permanent residents

 

Lower paying occupations

+1.7 to 4.5

Higher paying occupations*

–0.2 to –0.6

GNP, less payments to people without permanent residency status

–0.9 to –1.1

*Annual income of $20,000 or more.

A negligible effect is an increase or decrease of less than 0.05 percent.

Results are estimates of percent difference in the outcome between the base forecast and the alternative scenario in Year 15 of the policy period.

GNP=Gross National Product.



Source: USDA, Economic Research Service.

[2] Simply as examples, not as specific ideas:
"High Density Vertical Growth": http://peekURL.com/vtnWH5E
"Farms of the Future": http://peekURL.com/vYHtrN3

Tue, 06/12/2012 - 11:04 · Importance: 4