July 2023, Volume 29, Number 3
DOL certified 13,500 employer applications to fill 212,000 jobs with H-2A workers in the first two quarters of FY23, up from 12,000 applications to fill 193,000 jobs with H-2A workers in the first half of FY22. Some employers file multiple applications.
DOL certified almost 372,000 jobs to be filled with H-2A workers in FY22, including 193,000 or 52 percent in the first two quarters. If the 212,000 first half certifications are 52 percent of the eventual FY23 certifications, DOL will certify 408,000 jobs in FY23.
AEWRs. Farm employers sued DOL and encouraged legislators to support a Congressional Review Act resolution to prevent DOL from implementing a new AEWR methodology that uses the OEWS to set some AEWRs for some job titles.
The farmers’ suit asserts that DOL should first be required to prove that the presence of H-2A workers harms US workers before setting AEWRs, which were first established in 1960 to prevent Braceros from harming US workers.
DOL is authorized to make “an economic determination of what rate must be paid all workers to neutralize any ‘adverse effect’ resultant from the influx of temporary foreign workers.” DOL says that the AEWR approximates the “equilibrium wages that would result absent an influx of temporary foreign workers.”
DOL requires US employers who are certified to employ H-2A workers to offer and pay the average hourly earnings of field and livestock workers as determined by USDA’s FLS. The farmers’ suit says that USDA’s FLS was not designed to determine equilibrium wages.
There was one AEWR per state for all job titles until 2023. Under the new DOL AEWR regulations, farmers describe the job and the SWA issues a job title or SOC. If USDA’s FLS has average hourly earnings data for that job title or SOC, FLS earnings from the year before are used to set the AEWR for the next year. If the FLS does not have earnings for that job title, DOL’s OEWS is used to set the AEWR.
The result can be a doubling of AEWRs for some “nonfarm” job titles such as truck driver and construction worker, from $13 to $15 to $25 to $30 an hour. A special concern of employers is that DOL says that workers who perform several jobs, such as driving a crew of workers and harvesting with the crew, are entitled to the higher AEWR driver for of all hours worked.
One issue is whether H-2A workers should be considered entry-level or experienced. The H-2A program is expanding, which means that some H-2A workers are employed in US crops for the first time. However, most H-2A workers are young men in their late 20s and early 30s who have filled US farm jobs previously, which explains why they are 15 to 30 percent more productive than typical US workers in their 40s and 50s.
This means that paying H-2A workers average SOC earnings may underestimate their value to the employer if the H-2As are extraordinarily productive.
Costs. Are H-2A workers more expensive than US workers? Employers typically pay $100 to $250 per worker to a recruiter if needed (many H-2A workers return to the same employer year-after-year, reducing recruitment costs), and $1,500 to $3,500 per contract in agent or attorney costs if the employer does not have in-house staff to process H-2A applications.
A typical contract requests 20 H-2A workers, making the per worker cost $75 to $175 in agent or attorney fees. However, per worker agent costs can be as low as $15 to $35 per worker for a contract requesting 100 workers.
The cost of US government fees and processing costs is about $750 a worker, and employers incur $500 to $750 in costs to house each worker at the US consulate and then provide transport to the US. Once in the US, H-2A workers earn $120 to $150 a day and employers pay $10 to $30 a day to house and transport each worker from their housing to the fields.
Over a typical six-month or 25-week contract that involves to 125 to 150 days of US work, the extra costs of an H-2A worker over a US worker who is not housed or transported by the employer is about $5,000, based on $2,000 to get an H-2A worker to the US worksite and $3,000 at $20 a day for housing and food for 150 days. The wage bill for 125 days of work at $130 a day is $16,250, so the total costs of an H-2A worker are $21,250.
Employers would have to pay payroll taxes on US worker earnings of $16,250 that range from eight to 12 percent across states, reducing the $5,000 extra cost of an H-2A worker to about $3,500. If the H-2A worker is 20 percent more productive than the US worker, most of the extra H-2A costs disappear.
USCIS in January 2023 proposed to raise the fee for filing an I-129 petition from $460 to $530 for H-2A workers if the employer does not name the workers and $1,090 if the employer names up to 25 workers; most employers do not name the workers. USCIS would also levy a $600 per petition fee to support asylum processing.
Congress. The Farm Workforce Modernization Act (HR 4319) was re-introduced in the House in June 2023. The FWMA was approved by the House twice, but not considered by the Senate.
The Senate Judiciary Committee held a hearing on the H-2A program May 31, 2023. Titan Farms, with 6,000 acres of peaches, employs 800 H-2A workers, including 90 percent who worked at Titan previously. Titan’s CEO warned that rising AEWRs will fuel food price inflation, and criticized DOL’s regulation effective July 1, 2023 that shifts from one AEWR per state to AEWRs by job title. He also criticized rising imports of fruits and vegetables from Mexico, urging yes to migrant workers but no to imported produce.
Employer-friendly witnesses echoed Titan and also criticized DOL’s change to AEWRs by job title, while worker-friendly witnesses emphasized that AEWRs have not risen in real or inflation-adjusted terms and that there are many cases of employers abusing of H-2A and US farm workers.
Food security and competition from imports loomed large. The US has switched from being a net exporter to a net importer of farm commodities. However, the data must be interpreted carefully, since the $100 billion in annual US horticultural imports in 2022 included $27 billion worth fresh fruits and vegetables in 2022 and $26 billion worth of alcoholic beverages: beer worth $7 billion in 2022, wine $7 billion, and spirits $12 billion.
HR 3516 would allow DOS to waive in-person interviews for returning H-2A workers, that is, H-2A workers who had an H-2A visa previously would not have to be available at US consulates for in-person interviews.
H-2B. The H-2B program allows US employers who cannot recruit sufficient US workers to fill up to 66,000 seasonal nonfarm jobs with H-2B workers. Congressional riders have allowed the H-2B cap to increase, and some workers extend their stay in the US, so that an estimated 156,000 H-2B workers were employed in the US in 2022.
Almost half of H-2B jobs in FY 21 were in building and grounds cleaning occupations, which includes landscaping. The House Appropriations Subcommittee on Homeland Security in June 2023 voted to exempt H-2B workers who are returning to their US employer from the 66,000 a year cap and to allow H-2A workers to be employed in year-round jobs.
Signal International, a marine oil-rig company with a shipyard in Pascagoula, Mississippi, relied on US and Indian recruiters to bring 500 Indian welders to the US to build and repair offshore oil rigs after Hurricane Katrina. The Indians paid $20,000 each for H-2B visas that, they were promised, would be converted to immigrant visas after nine months.
There is no path from H-2B to immigrant visa. When the Indians learned that they had been tricked, they protested in March 2007. Signal enlisted ICE and tried to fire and deport the Indians who were leading the protests, but worker advocates blocked the vans that were to take them to the airport. In 2015, Signal agreed to pay $20 million to settle the labor trafficking cases filed by the Indian workers and filed for bankruptcy.
An additional 109,000 foreign workers, often students, can be employed as J-1 Summer Work Travel lifeguards and in seasonal hospitality jobs under a DOS-run exchange program administered by private sponsors that often charge foreigners for J-1 visas.