Farmers Facing Severe Labor Shortage

(WASHINGTON, DC) In recent years, farmers have reported an increase in labor shortages. These reports are supported by USDA data, showing average wages for nonsupervisory farm laborers rose more quickly since 2014. According to the Economic Research Service (ERS), economists consider inflation-adjusted wage growth to strongly indicate labor shortages in a given industry. From 2014 to 2017, the farm wage grew faster than the nonfarm wage, rising from 55 to 57 percent of the nonfarm wage. The average hourly wage for nonsupervisory hired farmworkers during the same time period rose from $11.69 to $12.47, an increase of 7 percent. In contrast, the rise in hourly wage for all nonsupervisory production workers outside of agriculture rose from $21.34 to $22.05, an increase of just over 3 percent. Inflation-adjusted wage growth slowed in 2017 because of lower rates of nominal (non-adjusted) wage growth and an uptick in inflation: which is a trend that has continued into 2018. As of April, nonsupervisory farm wages averaged $12.74 per hour in nominal terms, an increase of 3 percent over April 2017.