Economic Impacts and Implications of Foreign-Born Labor Reductions in Agriculture - Emphasis on Dairy Farms

Giving consideration to the bills and laws being discussed in Congress during the last few years regarding immigration reform, the need has arisen to study the effects of immigrant labor on the dairy industry. The objective of this study is to consider the economic impacts of reducing the availability of immigrant workers in the United States. This analysis utilizes the IMPLAN model, developed and maintained by the Minnesota IMPLAN Group, for analyzing the effects of 20 percent, 50 percent and 100 percent reductions in immigrant labor within the dairy industry. IMPLAN maps the economy using an input/output structure that “describes commodity flows from producers to intermediate and final consumers”. The employment and production data used as inputs into the model were gathered using a national survey of 5,005 dairy farms with respondents from 47 states and a response rate of 41.4 percent. Approximately 50 percent of the 5,005 dairy farms surveyed use immigrant labor. Results of the analysis estimate baseline nationwide economic activity, employment, and total value added impacts attributable to dairy farming to be $48.1 billion, 301,300 jobs, and $19.6 billion, respectively. With a 20 percent reduction in immigrant labor, the values fall to $43.6 billion, 274,800 jobs, and $17.8 billion. Under a 50 percent reduction in immigrant labor the values are $36.9 billion, 235,000 jobs, and $15.1 billion. Under a 100 percent reduction in immigrant labor scenario, the values fall to an estimated $25.7 billion, 168,700 jobs, and $10.5 billion. These reported figures include the impacts directly linked to the dairy industry as well as those to the rest of the economy. This analysis reports both intra- and inter-industry impacts but gives special attention to the inter-industry impacts within the economy.