Mar 7, 2019
H-2A use soars amid wage challenges

The U.S. Department of Labor (DOL) certified nearly a quarter of a million H-2A positions in 2018. This is 108 percent more than the number of positions certified in fiscal year 2014, just five years ago, and more than double the number of positions in a short time span – with no sign of a slowdown anytime soon.

In July 2018, after the third quarter H-2A program data was released by DOL’s Office of Foreign Labor Certification, Veronica Nigh, an economist with the American Farm Bureau Federation, predicted “an extremely large number of positions would be certified in the fourth quarter, pushing DOL certifications over the 240,000 mark in fiscal year 2018.”

With DOL certifying more than 49,000 positions in July, August and September – an increase of over 23 percent from fourth quarter 2017 – that projection was proven correct. A strong fourth quarter brought the total number of certified positions in FY 2018 to 242,762 – an increase of more than 21 percent over FY 2017.

Nigh said the end of the fiscal year presented a good opportunity to compare growth in H-2A use among different states and crops. In FY 2018, Georgia had the largest number of certified positions, surpassing Florida, which led the nation in certified H-2A positions in 2015, 2016 and 2017. Georgia was able to capture the title for the first time with an incredible 38 percent increase in certified positions between 2017 and 2018. All of the top five H-2A utilizing states experienced position growth between 2017 and 2018. Even more incredible, Nigh said, is the increase over the last five years.

Between 2014 and 2018, Georgia, Florida, Washington, North Carolina and California experienced growth rates of 212 percent, 125 percent, 174 percent, 50 percent and 213 percent, respectively. Louisiana, Kentucky, New York and Arizona, all among the top 10 states over the last five years, also experienced growth in FY 2018, increasing by 14 percent, 3 percent, 11 percent and 24 percent, respectively.

The state of Michigan completes the top-10 list with 8,359 positions, a growth of 24 percent from 2017. Michigan’s position as the seventh-largest user of the H-2A program is especially impressive given that it only just made the top 10 list for the first time in 2017.

Congress created the H-2A nonimmigrant agricultural visa program in 1986, under which U.S. farms can legally employ foreign workers on a temporary basis where they can prove to the Department of Labor that they are unable to find and recruit sufficient numbers of U.S. workers and that the employment of foreign workers will not “adversely affect” U.S. workers similarly employed.

According to National Council of Agricultural Employers’ (NCAE) President and CEO Michael Marsh, DOL does not currently measure actual “adverse effect” on U.S. workers but uses average wage data from USDA to set a minimum wage for foreign agricultural workers. DOL has no other mechanism right now to alter the methodology. The calculations result in a wage level significantly higher for the 2019 growing season, a far greater increase than the national average and at a time when prices are level or decreasing for most crops.

“Without immediate action, growers will face increases of up to 23 percent in labor costs within the next few weeks as a result of this methodology,” Marsh wrote.

In November, at NCAE’s fifth annual Ag Labor Forum in Las Vegas, discussion regarding the H-2A program was front and center.

NCAE’s board announced it was asking for short-term relief from imposition of new wage rates for 2019 under the “adverse effect wage rate” (AEWR) for H-2A employment, sending a letter sent to DOL Secretary Alexander Acosta and U.S. Department of Agriculture Secretary Sonny Perdue.

That communication was followed a day later when NCAE delivered a letter to House Speaker Paul Ryan, Minority Leader Nancy Pelosi, Senate Majority Leader Mitch McConnell and Senate Minority Leader Chuck Schumer requesting that they support an effort for a short-term freeze on any increase in the AEWR.

Writing to convey NCAE members’ “serious concerns” with the findings of the NASS Farm Labor Survey published on Nov. 15, 2018, and, more specifically, the prospect that those figures will be used to set the AEWR in 2019, Marsh praised the efforts of the departments to improve the survey process.

However, he asked for more extensive changes to the wage-setting process that would employ state- or local-based prevailing wages, an approach that retains a market-based outlook, prior to making any changes to rates for 2019. The letter to Congress was signed by several agricultural organizations.

NCAE called for leadership to support an effort by U.S. Sen. Thom Tillis, R-North Carolina, in advancing a proposal to implement a short-term hold for wage rates for the 2019 growing season providing a window for the departments of labor and agriculture to “develop an improved system for determining an accurate and market-based assessment of adverse effect wages and the most effective mechanism to address it.”

The NCAE action came in response to a USDA wage survey used to establish an AEWR in the H-2A temporary agricultural guest worker program that “inexplicably” indicated FY 2018 agricultural wages had dramatically spiked an average of more than 6 percent nationwide with some states seeing an increase of almost 23 percent.

“A temporary freeze on agricultural wages is an imperative if U.S. farms and ranches are to survive,” Marsh said.

“Unfair retaliatory tariffs have clobbered American agriculture and placed many family farms and ranches in jeopardy. Mandating ag wage increases of as much as 23 percent on farmers in a year when average U.S. wage growth has been under 3 percent is unsustainable.”

Due to the complexity of the H-2A program, meeting all of its legal obligations can be a daunting task. Unfortunately, noncompliance with governmental regulations could result in costly sanctions.

– Gary Pullano, FGN Managing Editor

Above: Congress created the H-2A non-immigrant agricultural visa program in 1986, under which U.S. farms can legally employ foreign workers on a temporary basis. Photo: Gary Pullano