Projects Funded for Steve Boucher

2011-2012

The "Great Recession" and the Supply of Mexican Labor to US Agriculture: A Quasi-Experimental Panel Analysis

Abstract

We investigated the impacts of the "great recession" in 2008-09 on migration from rural Mexico to U.S. farm work using nationally representative panel data from households in rural Mexico with observations in years 2002, 2007, and 2010. Taylor, Charlton, and Yúnez-Naude (2012) compare individuals' employment in 2007, before the "great recession," and in 2010, after the recession. The study found a greater percentage decline in the number of rural Mexicans migrating to farm than nonfarm jobs in the U.S., even though the demand for farm labor remained steady throughout the recession. Of the migrants who remained in the U.S. between 2007 and 2010, some switched from the nonfarm to the farm sector, as expected given the change in the relative demand for labor across sectors, but even more migrants switched from the farm to the nonfarm sector. Additionally, the number of workers in the Mexican nonfarm sector grew steadily from 2002 through 2010. This evidence suggests that the rural Mexican workforce is transitioning off the farm. Our panel econometric estimates confirm this. The transition of the labor force away from farm work is consistent with a trend observed in nearly every country around the world: as per capita GDP rises, the share of workers in agriculture rapidly declines. The transition of Mexican workers away from agriculture will have profound impacts for the U.S. farm sector, which historically has depended on an elastic supply of Mexican farm labor and will now have to compete with Mexican farms for a dwindling supply of labor. To adjust to a smaller supply of labor, in the future U.S. farming will need to become more mechanized, relying on fewer and more productive workers. This will impact both the U.S. farm industry and rural communities; increasing skills and wages of farm workers may help break a vicious circle of farm employment, immigration, and poverty.

2009-2010

Index Insurance: A Viable Risk-Management Tool for Farmers in the Southern San Joaquin Valley?

2007-2008

Index Insurance and Agricultural Risk: A Dynamic Analysis

2006-2007

The Causes and Consequences of Rural to Urban Migration in Mexico and China and the Implications for the U.S. (California)

2005-2006

Risk, Wealth and Contractual Structure in Agriculture

2004-2005

Impacts of Policy Reforms on the Supply of Mexican Labor to U.S. Farms: New Evidence from Mexico

2003-2004

The Structure and Performance of Rural Financial Markets and the Welfare of the Rural Poor in Mexico