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April 2020, Volume 26, Number 2

California: Virus, Overtime

The coronavirus changed work and personal lives for most people around the world in March-April 2020. Workplaces and schools closed and people were asked to stay at home to avoid catching and spreading the virus.

Farming and food packing and processing were deemed essential industries, and farm workers were expected to report to work. March is typically the trough month of the year for employment in crop agriculture, except in Arizona and Florida, so the initial effects of the stay-at-home orders were limited.

Farmers expressed concerns about labor shortages due to workers or their families getting sick, some workers staying home to care for children who could not go to school, and barriers to importing H-2A guest workers. There were few initial reports of farm workers testing positive for coronavirus, and tracking data found farm workers and others in agricultural counties continued to move about in March-April as before.

Child-care facilities and schools closed, increasing child-care responsibilities. Half of the crop workers interviewed by the NAWS are parents with an average of two children under 18, although not all crop workers have their children with them where they work.

The Department of State issued over 200,000 visas to H-2A guest workers in FY19. These guest workers were employed for an average six months in the US, so they fill over 10 percent of the million year-round equivalent jobs in US crop agriculture. DOS allowed consular officials to waive in-person interviews for first-time and returning H-2A workers to facilitate their entry.

Farm employers took a number of steps to slow the spread of Covid-19, including taking fewer workers on buses and making several trips, practicing social distancing during rest and lunch breaks, and conducting temperature checks before work starts. Some employers added hand-washing stations and provided education on how to prevent the spread of the virus.

Some employers fear that there may be fewer farm workers due to paid sick leave and more generous unemployment insurance. The Families First Coronavirus Response Act (HR 6201) requires private-sector employers with fewer than 500 employees to provide their employees with up to two weeks of fully or partially paid sick leave for COVID-19 related reasons between April 1 and December 31, 2020.

Overtime. AB 1066 is phasing in overtime pay for farm workers by 2022. Large employers must pay 1.5 times usual wages for work in excess of nine hours a day and 50 hours a week in 2020. AB 2956 would create a state tax credit for farm employers equal to the overtime pay they provide to farm workers.

Proponents of state tax credits for overtime pay believe farmers would be more willing to pay overtime wages, which increase farm worker earnings and spending in farm worker communities. They argue that workers would not have to find a second part-time job to obtain more hours of work, since tax credits would encourage employers to maintain current work schedules.

There are limited data on the typical hours worked in agriculture. Both the USDA ALS and the NAWS find that most farm workers were employed 40 to 45 hours in the week of the survey. Payroll or survey data could indicate how workers were employed particular hours, such as the share of workers employed more than 40, 45, 50, 55, and 60 hours a week, while focus groups with workers could reveal how employers and workers are adapting to 9/50 overtime rules.

Napa. A 2018 survey of over 600 vineyard workers and 50 supervisors in Napa county found that two-thirds of the permanent workers, and 85 percent of seasonal workers, lived outside Napa county, including some who commuted from 100 miles away.

Commuting to work in Napa was a major concern of workers, followed by the dangers of pesticides and other chemicals used in vineyards. Workers also complained of inadequate communication about wages and other personnel policies. Some thought there was too much wage compression, as both new hires and experienced workers earned $15 to $20 an hour. Most workers liked their co-workers and the nature of the work they did.

Seasonality. Average employment in California agriculture rose three percent between 2000 and 2018, from 408,600 to 421,800. Peak employment was 492,000 in September 2000 and trough employment was 313,000 in January 2000, for a peak-trough ratio of 1.6. By 2018, peak employment was lower, 483,499 in June, and trough employment was higher at 345,500 in January, for a peak-trough ratio of 1.4, that is, seasonality at the state level declined over the past two decades.

Agricultural employment has increased and seasonality has decreased because of the changing mix of commodities, as when raisin grapes, which have a short harvest season, are replaced by table grapes, which are harvested over a longer season. Declining seasonality is especially visible in the two leading farm counties, Fresno and Kern.

Fresno county was the state’s largest farming county in 2000, producing commodities worth $3.4 billion, including $640 million worth of grapes, $400 million worth of poultry, and $355 worth of cotton. Most of Fresno’s grapes were from 171,000 acres of raisin grapes worth $365 billion in 2000. Employment in Fresno agriculture averaged 55,000 in 2000, and ranged from a low of 36,600 in March to over 80,000 in September, a peak-trough ratio of 2.2.

By 2018, Fresno’s farm sales more than doubled to $7.9 billion, and the top commodities were almonds worth $1.2 billion, grapes worth $1.1 billion, and pistachios worth $860 million. Raisin grape acreage declined to 80,000, and the value of the raisin crop was $314 million, less than in 2000 even when not adjusted for inflation. Employment in Fresno agriculture averaged 44,000 in 2018, and ranged from a low of 35,000 in March 2018 to over 53,000 in August, a peak-trough ratio of 1.5.

Over almost two decades, Fresno’s agricultural employment fell and seasonality declined as nuts replaced raisin grapes and tree fruits. Trough employment did not change much, but peak employment declined significantly.

Kern county’s agriculture evolved differently. Farm commodities were worth $2.2 billion in 2000, led by grapes worth $440 million, citrus worth $290 million, and cotton worth $225 million; the value of raisin grapes, $82 million, exceeded the value of table grapes, $67 million. Employment in Kern agriculture averaged 43,000 in 2000, and ranged from a low of 33,600 in March to over 63,500 in August, a peak-trough ratio of 1.9.

By 2018, Kern’s farm commodities were worth $7.5 billion, led by $1.5 billion worth of grapes, $1.2 billion worth of almonds, and $1.1 billion worth of pistachios. By 2018, the value of raisin grapes, $128 million, was a tenth of the $1.2 billion worth of table grapes. Employment in Kern agriculture averaged 62,400 in 2018, and ranged from a low of 42,400 in March to over 72,600 in August, a peak-trough ratio of 1.7.

Over almost two decades, Kern’s agricultural employment rose and seasonality declined as table grapes replaced raisin grapes and nuts replaced citrus and cotton in the agricultural economy. Both trough and peak employment rose by about 10,000 a month.

McFarland. McFarland’s Planning Commission in February 2020 blocked the Geo Group’s application to take over two state prisons slated for closure and use them to detain unauthorized foreigners. McFarland’s 15,000 residents include many unauthorized Mexicans who urged city leaders to reject the private immigrant detention facilities. MaFarland’s mayor said that McFarland needs Geo’s tax revenue and jobs.

A state law enacted in 2019 bars new private prison contracts, but the Geo-ICE agreement for the 700-bed Central Valley and Golden State prisons was signed before the law took effect. Geo is McFarland’s second-largest employer, after the school district, and Geo promised jobs as well as $2 million a year in taxes and fees.

Opponents argued that an ICE facility in McFarland would mean ICE agents could encounter and detain unauthorized residents. Over 80 percent of the 44,000 foreigners who were detained by ICE in 220 facilities around the US in January 2020 were operated by private contractors.

Cannabis. Some farm workers are switching from seasonal fruit and vegetable jobs to cannabis greenhouses that offer eight-hour days and year-round work.

There were almost 5,000 active cannabis licenses in 2020, including over 1,200 in Humboldt county and over 1,150 in Santa Barbara county. Glass House Farms in Santa Barbara employs 25 workers to care for 500,000 square feet of cannabis. Higher profits in cannabis mean higher wages, at least $15 an hour and better benefits. Workers appreciate not having to work with plants that are sprayed with pesticides.

There are worries in coastal farming areas that more farm workers will move to cannabis farms. Napa county banned cannabis farms, in part so that workers would not move from “wine to weed.”

Moody’s estimates that total US cannabis sales in 2019 were $40 billion, and that legal cannabis is at least 75 percent more expensive than black market or untaxed cannabis. California collected $514 million in state and local cannabis taxes in 2018-19, followed by $362 million in Washington and $302 in Colorado.