Labor Market Policies and Institutions in an Industrializing Agriculture

Abstract

This paper addresses labor market policies and institutions relevant principally to the seasonal, unskilled, hired agricultural work force including but not limited to migrant agricultural workers. The seasonal agricultural labor market and labor market institutions serving it have been subject to remarkably little systematic study by agricultural economists.' Thus, much of the following represents a structure imposed on the observables for the purpose of this exposition. Likewise, the discussion of farm labor policy is an attempt to describe explicitly what has, for the most part, been implicit policy. I begin by tracing the broad parameters of structural change in agricultural employment and the agricultural labor market during the industrialization of U.S. agriculture since World War II. I argue that implicit agricultural labor market policy has been largely oriented toward two goals: (a) transferring of unemployed and underemployed agricultural workers to other occupations in order to provide them with income and employment, while simultaneously improving the bargaining power of the remaining agricultural workers by reducing the wage-depressing effects of surplus labor; and (b) regulating employers and labor market intermediaries in order to protect agricultural workers from abuse and improve their welfare. Each of these efforts has had limited success, and for largely the same reasons. An enormous in-flow of new labor force entrants has frustrated attempts to eliminate the agricultural labor surplus. This nearly unlimited supply of workers has also introduced incentives for both employers and workers to bypass the labor market intermediaries through which agricultural labor policy has attempted to regulate agricultural labor markets, most notably the U.S. Employment Service, traditional farm labor contractors, and employer associations. It is argued that the conditions leading to the current situation are not likely to continue, and that without serious and timely efforts to reorient agricultural labor policy and to rebuild or create new labor market institutions, producers of seasonally labor-intensive commodities may face serious difficulties in adjusting to changes in labor availability and cost in the years ahead.