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January 2017, Volume 23, Number 1
Farm Workers and FLCs
Agriculture has two major sectors, crops and livestock. Crops require the most hired workers, many of whom work seasonally, while livestock employs a higher share of year-round workers. Total crop labor expenditures were $23 billion in 2012, and livestock labor expenditures were $10 billion.
All data sources agree that California has about 30 percent of US crop worker employment, followed by three states with five to six percent, Washington, Florida and Texas. Two more states have about three percent of crop worker employment, Michigan and Oregon, so that over half of crop worker employment is in six states.
The distribution of hours worked in livestock is different. Texas and California each have 10 percent of livestock hours worked, followed by Wisconsin with six percent and Iowa and New York with almost four percent each, so that a third of livestock hours worked are in the five leading states. Livestock hours are less concentrated than crop hours because there is no California among livestock states.
H-2A guest workers fill about 10 percent of year-round equivalent jobs in US agriculture. Most work in crops, because most H-2A guest workers are limited to 10 month stays in the US. Estimates of the earnings of H-2A workers suggest that those in crops earned almost $800 million in 2012 and those in livestock $100 million, that is, less than five percent of total labor expenditures.
The top five H-2A states, North Carolina, Florida, Louisiana, Kentucky and Georgia, accounted for 40 percent of the earnings of H-2A workers employed in crops, while the top five livestock H-2A states, Utah, Louisiana, Colorado, Wyoming and Idaho, accounted for over half of the earnings of H-2A livestock workers. The H-2A crop states are in the southeast; the H-2A livestock states are in the mountain regions except for Louisiana.
FLCs. There are several sources of data on farm labor contractors. The federal list of licensed FLCs across the US, including supervisors, had over 9,700 entries in July 2016, often several individuals at one address.
There were seven states with over 100 entries on the federal list: Arizona, 465; California 4,600; Florida, 2,725; Georgia, 250; North Carolina, 325; Oregon, 180, and Texas, 445, and they accounted for 9,000 or over 90 percent of all entries. California accounted for half of the entries on the federal FLC list, and Florida more than a quarter. There are registered FLCs in most states, but they are heavily concentrated in California and Florida.
California had 1,433 state-licensed FLCs in July 2016. Most charge overhead or commissions to their grower clients of 33 to 45 percent, which means that if the hourly wage is $10, the contractor receives $13.33 to $14.50 per hour worked to pay workers, payroll taxes and cover business expenses. The major variable in the commission rate is the cost of workers' compensation insurance.
California FLCs are regulated strictly. SB 1087 requires FLCs, their supervisors, and their employees to undergo sexual harassment training each year. When working in a particular place, FLCs must erect a 4x4 foot sign that includes their license and a telephone contact number.
There is little data on FLCs by size. However, it is likely that the largest 10 percent of California FLCs, less than 150, account for over half of FLC payroll and employees.