Housing booms and H‐2A agricultural guest worker employment

Abstract

AbstractThis paper examines the effects of changes in housing demand on H‐2A employment within commuting zones from 2001 to 2017. Agricultural employers who demonstrate that no workers in the domestic labor market are willing or able to perform a seasonal or temporary farm job can apply for certification to hire guest workers through the H‐2A visa program. H‐2A employment grew more than 450% between 2001 and 2019 from 45,000 to 258,000. This is one of the first papers to econometrically examine causal factors that contributed to the growth of H‐2A employment. We find that a 1% increase in housing demand leads to a 0.40%–0.97% increase in H‐2A employment. We also show suggestive evidence that changes in housing demand affect H‐2A employment through shifts in the demand for workers in nonfarm industries that pull workers from the agricultural sector. Consistent with previous literature, we show that positive housing demand shocks lead to increased employment in construction and other nontradable sectors that traditionally hire immigrant workers. We also find positive effects of housing demand on local farm wages, consistent with an inward shift in the local farm labor supply during housing booms.