December, 2014

Fruits of Thought

Wake Up Call On Labor

With the President extending protection from deportation to about 5 million illegal aliens, one wonders if the produce industry will face up to its real labor problem.

The sad truth is the fact that legalizing the status of illegal immigrants — even if it holds up in court — is not going to do very much for the produce industry. Indeed, it may actually hurt the produce industry, as some of the workers will feel free to compete for more desirable jobs.

Which brings us to the crux of the matter: What the produce industry has fought for are dedicated guest worker programs. Why? Because no reasonable increase in the number of immigrants allowed into the country would attract workers to the harvesting fields, so the industry needs a dedicated program by which people come into the country obligated to work in agriculture, or they go home. Staying and working in more pleasant jobs is not an option.

But why should this be so? Why should produce harvesting be so uniquely horrible a job that we can’t get anyone to do the work if they have a choice? And why should this situation be acceptable to the industry?

The whole trend to “know your farmer” is not just a matter of liking to see Joe in overalls. It’s about a change in public mindset in which consumers want produce to look good, taste good, and they want to feel good about eating it. That means knowing that the soil is protected and rejuvenated, and the labor force is treated with dignity.

It is astonishing to listen to devout capitalists say things like “no American will do this work.” Even if this statement is true, all that means is one has to change the work so one can attract the needed labor.

Years ago, this columnist worked in the family produce business importing, exporting and wholesaling. The import department was frenetically busy in the winter, bringing in Chilean fruit and tropically grown melons, but had almost no work during the summer. Yet we couldn’t get enough people to just work seasonally; we had to hire full time, year-round employees in order to have who we needed during the busy winter season.

We don’t know what would ultimately persuade people to want to work in the fields. Maybe it is more money, maybe it is a shorter work week or more vacation; maybe the jobs need to offer benefits, such as medical, dental, pensions, etc. But labor is a market. It is a matter of supply and demand, and although we can sympathize with farmers who want a dedicated labor supply at a fixed cost, it would be better if the produce industry offered opportunities that were competitive with other industries.

This means higher costs, and one can predict that high costs for labor will make new levels of mechanization viable, which in the end will depress the amount of labor needed. It may also change the nature of the jobs. They may be less physically demanding and less uncomfortable as they transition to a kind of an operator of robotic machinery and less manual harvesting. Ironically, the jobs created by increased mechanization may be more desirable, and thus easier to fill than the jobs they supplanted of manually harvesting produce.

The challenges are many and obvious. Higher labor costs will tilt the cost structure in a way that encourages more imports. Higher costs will be passed on to consumers in the form of higher prices. One will expect demand for the kinds of import-tariff protection the steel industry and auto industry receive from time to time.

Still, this might be a better fight for the produce industry to push for duties that make higher labor costs sustainable than to push for laws that will enable the industry to continue to offer jobs that are so bad that the only way we can fill them is to make working in the industry a condition for being allowed in America as a guest worker.

In many ways, this transition to a higher-cost labor force, with more robotics and mechanization and less need for labor, is a shame. There are so many people around the world who need jobs that it would seem the most ethical path is to hire them and not invest in mechanization.

There are, however, externalities to hiring labor this way. Crime, use of free medical care, and — as the President has just shown — our country doesn’t have the stomach to throw people out. There is also a kind of aesthetic revulsion to the living standards of many migrant farm workers.

So in an age of “know your farmer,” the produce industry should be prepared to be rigorously scrutinized. Part of surviving that scrutiny is offering jobs — wages and conditions — that are attractive to the market. It is a new thought direction for much of the trade, but the whole notion of being transparent is also new. It is, however, the only sustainable path. pb