Elements of immigration reform crucial

Elements of immigration reform crucial

Report says how immigration system is reformed is as important as whether system is reformed, from ag's perspective.

FOLLOWING the release of the House Republican Committee's principles for immigration reform, agricultural groups are calling for the agriculture industry to be properly addressed in any reform to keep labor costs and, in turn, food prices manageable.

White House press secretary Jay Carney said en route to the Feb. 7 farm bill signing event that the White House remains "hopeful and optimistic that the progress we've seen in the House and overall in the Congress will continue and that we can get a comprehensive immigration reform bill through Congress and signed by the President this year."

Carney said the Administration "strongly supports a pathway to citizenship."

How agriculture fares in immigration reform — including enforcement, a pathway to legalization and a guest worker program — depends on the specifics of the guest worker program, according to "Gauging the Farm Sector's Sensitivity to Immigration Reform," a new report conducted by World Agricultural Economic & Environmental Services.

The report says simply extending the H-2A program would leave the agriculture sector facing smaller but still disruptive 25-28% increases in wages as an H-2A-type package of wages and benefits became the standard for the sector (Table).

"This reflects the extent to which the current H-2A program is broken," the report notes. "With a guest worker program modeled after the W-3 and W-4 provisions of the Senate's 2013 bill, the sector would face 6% to 9% increases in labor costs that could be absorbed without major displacement, particularly over time as the trend toward mechanization continued."

The report notes that an approach to agricultural labor reform that focuses solely on immigration enforcement would raise food prices over five years by an additional 5-6% and would cut the nation's food and fiber production by as much as a staggering $60 billion.

By far, the best scenario for farm labor reform for both consumers and farmers is one that includes immigration enforcement, a redesigned guest worker program and the opportunity for undocumented skilled laborers currently working in agriculture to earn an adjustment of status, the report explains. Under that scenario, there would be little to no effect on food prices, and the impact on farm income would be less than 1%.

Today, U.S. agriculture depends heavily on falsely documented or undocumented workers, and regardless of the reform scenario studied, it is clear that a legal workforce will come at a price.

The hardest-hit domestic food sectors under an enforcement-only scenario are fruit production, which would plummet by 30-61%, and vegetable production, which would decline by 15-31%. The report also points out that while many consider fruit and vegetable production to be the most labor-reliant sector, U.S. livestock production would decrease by 13-27%.

"Over five years, an enforcement-only approach would lead to losses in farm income large enough to trigger large-scale restructuring of the sector, higher food prices and greater dependence on imported products," said Bob Stallman, president of the American Farm Bureau Federation, which commissioned the study.

"With a reworked guest worker program and by allowing skilled laborers to earn an adjustment of status, food prices remain stable, and there are only marginal impacts on production," Stallman said. "It's clear that we need greater enforcement, but those two key reforms must be included in the process."

The full report is online at www.fb.org/newsroom/nr/nr2014/02-10-14/labor-study14c0207.pdf.

 

Electronic verification

Meat and agricultural groups also praised the House Republicans' call for a "workable electronic employment verification system" as part of immigration reform.

"We strongly agree that this must be a priority, and we applaud the House majority for committing to bringing our immigration system up to date," according to a statement signed by the American Meat Institute, Council for Global Immigration, National Association of Manufacturers, National Chicken Council, National Franchisees Assn., National Pork Producers Council, National Turkey Federation, North American Meat Assn. and Society for Human Resource Management.

"It is unacceptable that in the 21st century, our nation's employment verification system still relies on paperwork and uses a nearly 30-year-old, document-based approach to process new hires. Moreover, the optional E-Verify electronic system is itself almost 20 years old and fatally vulnerable to identity theft. It has failed to stop illegal immigration because it cannot dependably detect or deter this form of fraud," the statement adds.

"A workable employment verification system must stop workplace identity theft by preventing a job applicant from using a stolen identity to secure employment, and a workable system must also include protections for employers that follow the law but, due to failings in the government-run verification system, inadvertently hire unauthorized workers. It is unjust to hold employers accountable for relying on inaccurate information provided by the federally run system," the groups pointed out in their statement.

 

Impact of higher wages on U.S. agriculture sector performance (%)

 

-Scenario-

 

1 (low)

1 (high)

2 (low)

2 (high)

3 (low)

3 (high)

3A (low)

3A (high)

A. Wage rate change

Up 70%

Up 146%

Up 30%

Up 68%

Up 25%

Up 28%

Up 6%

Up 9%

B. Subsector impacts, % change

Grains

 

 

 

 

 

 

 

 

Production

-1

-3

-1

-1

0

-1

0

0

Farm price

-3

-6

-1

-3

-1

-1

0

0

Livestock

 

 

 

 

 

 

 

 

Production

-5

-8

-3

-5

-3

-3

-1

-1

Farm price

-13

-27

-6

-13

-5

-6

-1

-2

Vegetables

 

 

 

 

 

 

 

 

Production

-23

-47

-10

-22

-8

-9

-2

-3

Farm price

15

31

7

15

6

7

2

3

Fruit

 

 

 

 

 

 

 

 

Production

-30

-61

-13

-28

-11

-12

-3

-4

Farm price

20

40

8

19

8

9

3

4

Net farm income

-15

-29

-7

-14

-6

-6

-2

-2

Scenario 1: Enforcement only/enforcement first.

Scenario 2: Enforcement with a path to legalization and no guest worker program.

Scenario 3: Comprehensive reform that includes a guest worker program for agriculture similar to the H-2A program.

Scenario 3A: Same as scenario 3, but looking at a modified guest worker program.

Source: World Agricultural Economic & Environmental Services

 

Volume:86 Issue:07

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