IMMIGRATION POLICY AND THE AGRICULTURAL LABOR MARKET: SPECIALTY CROPS IN THE UNITED STATES Nobuyuki Iwai Robert D. Emerson Orachos Napasintuwong International Agricultural Trade and Policy Center Department of Food and Resource Economics University of Florida The World Trade Organization Impacts on U.S. Farm Policy Conference New Orleans, Louisiana, June 1-3, 2005

BACKGROUND Specialty Crops Specialty Crops Labor intensiveLabor intensive 37% on labor expenditures in fruits, vegetables, horticultural crops production vs. 13% for all ag production37% on labor expenditures in fruits, vegetables, horticultural crops production vs. 13% for all ag production Foreign workers Foreign workers 78% of ag workers in % of ag workers in % undocumented68% undocumented

IMMIGRATION POLICY Speculation that amnesty would lead to labor shortages and wage increases in agriculture Speculation that amnesty would lead to labor shortages and wage increases in agriculture Tran & Perloff (2002) Tran & Perloff (2002) IRCA of 1986 increased long-run probability that people granted amnesty stayed in agricultureIRCA of 1986 increased long-run probability that people granted amnesty stayed in agriculture Hashida & Perloff (1996) Hashida & Perloff (1996) Same directionSame direction Emerson & Napasintuwong (2002) Emerson & Napasintuwong (2002) Longer duration for authorized than unauthorized workersLonger duration for authorized than unauthorized workers

OBJECTIVES OF OUR STUDY Censored data: duration of a particular legal status is observed only if workers have that status Censored data: duration of a particular legal status is observed only if workers have that status Duration model with sample bias correction Duration model with sample bias correction Heckman two-stage sample selection method: ordered probit model explains legal status, duration model estimates spells for each legal statusHeckman two-stage sample selection method: ordered probit model explains legal status, duration model estimates spells for each legal status

Data National Agricultural Workers Survey (NAWS) National Agricultural Workers Survey (NAWS) Specialty Crops: all crops excluding major field crops, sugar beets, sugarcane, tobacco, and soybeans Specialty Crops: all crops excluding major field crops, sugar beets, sugarcane, tobacco, and soybeans Legal status: unauthorized, authorized, permanent residents, citizens (in order) Legal status: unauthorized, authorized, permanent residents, citizens (in order) Duration: completed farm work spells Duration: completed farm work spells

Results: Ordered Probit Model Female, Married, English speaking skills, Non-Black, White, Non- Hispanic, Education, Before 1993, Before 2001 have positive effect on higher legal status Female, Married, English speaking skills, Non-Black, White, Non- Hispanic, Education, Before 1993, Before 2001 have positive effect on higher legal status Age, U.S. farm work experience have non-linear effects, but positive over relevant range Age, U.S. farm work experience have non-linear effects, but positive over relevant range

Marginal Effects on Legal Status Female0.178 Married0.079 English speaking Black White0.054 Hispanic Age0.008 Education0.015 U.S. Farm Experience Before After

Actual-Predicted Legal Status ActualPredictedTotal UnauthorizedAuthorizedPermanentResidentCitizen Unauthorized79%10%11%0%100% Authorized43%21%36%0%100% PermanentResident14%15%70%1%100% Citizen8%8%63%21%100%

continued Results: Duration Model UnauthorizedAuthorizedPermanent Resident Citizen Task (-0.002) Free Housing (-0.007) (-0.006)(-0.007) California (-0.005)(-0.006)(-0.005)(-0.006) Florida (-0.008) (-0.009) After (-0.006)(-0.007)(-0.006)(-0.007)

continued UnauthorizedAuthorizedPermanent Resident Citizen Female (-0.007) Married (-0.006) English Speaking (-0.003)(-0.004) Hispanic (-0.011)(-0.012)(-0.01)(-0.012) Results: Duration Model ( continued)

UnauthorizedAuthorizedPermanent Resident Citizen Age (-0.001) Age ( ) Education ( )(-0.001)( )(-0.001) Experience ( )( )( ) Results: Duration Model (continued)

Average Predicted Duration (days) Unauthorized58.0 Authorized58.4 Permanent Resident 57.2 Citizen56.1

Simulations Fixed characteristics of workers at typical unauthorized worker Fixed characteristics of workers at typical unauthorized worker Male, married, Hispanic, non-black, non-white, no free housing, age 28, 6 th grade education, 5.8 years of U.S. farm experience, and speak less than a little English, but more than not at allMale, married, Hispanic, non-black, non-white, no free housing, age 28, 6 th grade education, 5.8 years of U.S. farm experience, and speak less than a little English, but more than not at all

Simulations Evaluate changes in duration under alternative legal status conditionally upon being an unauthorized worker Evaluate changes in duration under alternative legal status conditionally upon being an unauthorized worker From California, Florida, or rest of USFrom California, Florida, or rest of US Before 1993, , after 2001Before 1993, , after 2001 Harvest vs. pre-harvest workHarvest vs. pre-harvest work

Simulations Summary 14/18 cases, unauthorized workers working as authorized workers have longer durations 14/18 cases, unauthorized workers working as authorized workers have longer durations All cases, unauthorized workers working as permanent residents have longer durations (up to 19% longer) All cases, unauthorized workers working as permanent residents have longer durations (up to 19% longer) 13/18 cases, unauthorized workers working as citizens have shorter durations 13/18 cases, unauthorized workers working as citizens have shorter durations 14/18 cases, unauthorized workers working as legal (combined authorized, permanent resident, and citizen) workers have longer durations 14/18 cases, unauthorized workers working as legal (combined authorized, permanent resident, and citizen) workers have longer durations

Larger positive effects on expected duration for an unauthorized worker working under a legal status after 2001 Larger positive effects on expected duration for an unauthorized worker working under a legal status after 2001 Longer expected duration in Florida Longer expected duration in Florida Simulations Summary (cont.)

Conclusions Unlike other studies, switching from an unauthorized status to a legal status does not always increase expected farm work duration Unlike other studies, switching from an unauthorized status to a legal status does not always increase expected farm work duration Florida has a longer expected job duration than other states Florida has a longer expected job duration than other states After 2001, expected duration increases, and even more with a legal status After 2001, expected duration increases, and even more with a legal status