Labor Shortages Push Wages Higher

August 29, 2018 09:48 AM
 
As the U.S. economy continues to grow and unemployment dwindles, it becomes harder for dairy producers to find and keep labor.

As the U.S. economy continues to grow and unemployment dwindles, it becomes harder for dairy producers to find and keep labor. There are more opportunities for potential employees to opt for work in industries like transportation, construction, hospitality and mining that offer better pay. As manual laborers chase higher wages, producers are forced to increase wages at a faster rate to compete, according to a new study from CoBank’s Knowledge Exchange Division.

“Wages have historically been higher in these other industries compared to most farm labor,” says Ben Laine, a senior economist with CoBank. “The difference now is that these jobs are much more widely available and are more in line with the background of workers coming from Mexico.”

The scarcity of farm labor is exacerbated by tougher rules surrounding immigrant workers from Mexico.

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