Farmers in U.S., Mexico & Central America May Increasingly Have to Compete for Shrinking Agricultural Labor Workforce amid Evolving Regional Dynamics, MPI Report Finds

WASHINGTON — Agriculture is unlike most other key sectors of the North American economy in that its comparative advantage has rested on having access to abundant labor willing to do the work instead of on the accumulation of education and formal credentials. Agricultural labor trends are evolving, however, raising labor supply questions for the United States, Mexico and Central America.

For example, Mexico, which is still the largest supplier of hired labor to U.S. farms, is in the transitional phase of being both farm labor exporter and importer, increasingly relying on workers from Guatemala as its own agricultural workforce shrinks. And with the production of labor-intensive crops expanding in Mexico and the Northern Triangle (El Salvador, Guatemala and Honduras) as agricultural jobs become less attractive throughout the region, there could be a growing tension between labor supply and demand.

In Ripe with Change: Evolving Farm Labor Markets in the United States, Mexico, and Central America , economists Philip Martin and J. Edward Taylor of the University of California, Davis examine the region’s farm labor market dynamics. The report focuses on changes in the volume and composition of production, the supermarket revolution in Latin America, as well as on trends in training and education, and their implications for workers and migration.

While the share of the total workforce employed in agriculture is high in Mexico and Central America relative to the United States, it is falling fast. Across Mexico and Central America, educational attainment is increasing and incomes are rising — though these advances and demographic trends are evolving at different speeds in each country, the report finds. Mexico and El Salvador are seeing their populations age and total population growth slowdown. In contrast, birth rates remain high in Guatemala and Honduras.

“There is evidence that the supply of farm labor in the region is decreasing and that, in the future, farmers throughout the region will find themselves competing for a dwindling number of local farm workers,” Martin and Taylor write.

Said Migration Policy Institute (MPI) President Demetrios G. Papademetriou: “This has key implications not only for the United States, which relies significantly on a foreign agricultural labor workforce, but also for the region. Current labor and immigration policies may not ensure a continuous supply of labor to U.S. farms, possibly causing farmers to have to look further afield for workers, and/or pay higher wages and/or turn to labor-saving mechanization in selected crops.”

The agriculture sector report is the latest research from the Regional Migration Study Group, a partnership between MPI and the Latin American Program/Mexico Institute of the Woodrow Wilson International Center for Scholars. The Study Group, co-chaired by former Mexican President Ernesto Zedillo, former US Secretary of Commerce Carlos Gutierrez and former Guatemalan Vice President Eduardo Stein, is a high-level initiative that in March will propose new collaborative approaches to migration, competitiveness and human-capital development for the United States, Central America and Mexico.

A primary goal of the Study Group is to develop and promote a longer-term vision of how to build a stronger economic and social foundation by enhancing the region’s human-capital infrastructure. Building up human capital should foster better economic opportunities for the region’s citizens, creating an engine for growth in each country and strengthening regional competitiveness. “Over time, success in this regard will mitigate today’s concerns about the scope and ‘quality’ of regional migration, and will also set the stage for future regional migration to be more of a genuine choice, rather than a necessity,” Papademetriou said.

MPI recently published a paper examining the region’s manufacturing sector, and next week will publish a report on the region’s health care sector, followed by one on the transportation and logistics sector. The research and more on the Study Group’s mission and membership can be read here. 

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The Migration Policy Institute is an independent, non-partisan, non-profit think tank in Washington, DC dedicated to the study of the movement of people worldwide. MPI provides analysis, development and evaluation of migration and refugee policies at the local, national and international levels. Its National Center on Immigrant Integration Policy is a crossroads for policymakers, state and local agency managers, local service providers and others seeking to respond to the challenges and opportunities today’s high rates of immigration create in local communities. For more on MPI, please visit  www.migrationpolicy.org.