The San Joaquin Valley is the agricultural powerhouse of the United States and California. California accounts for an eighth of U.S. farm sales, largely because it produces high value fruit and nut, vegetable and melon, and horticultural specialty (FVH) crops such as nursery products and flowers. Over three-fourths of the state's $37 billion in farm sales in 2010 were crop commodities, and almost 90 percent of the $28 billion in California crop sales represented labor-intensive FVH commodities.
About half of California's farm sales and farm employment are produced in the eight-county San Joaquin Valley with four million residents that stretches from Stockton in the north to Bakersfield in the south. The leading U.S. farm county is Fresno, which had farm sales of almost $6 billion in 2010.
The U.S. Department of Labor (DOL) certified 165,000 farm jobs to be filled with H-2A workers in FY16, and is expected to certify over 200,000 jobs in FY17. The U.S. Department of State issued 134,400 visas to H-2A workers in FY16, up from 108,100 in FY15 and 55,400 in FY11.
The DOL does not generate estimates of the weeks of farm work done by H-2A workers or wages earned by H-2A workers. An analysis of FY12 data, when the DOL certified 85,248 jobs to be filled by H-2A workers, found that the 5,400 employers who were certified offered an average 33 weeks of employment for an average 43 hours a week to H-2A workers. If weeks of U.S. employment are multiplied by the number of workers requested by each employer, the average number of weeks drops to 26, reflecting the fact that several hundred employers offer 52-week sheepherder jobs to relatively few workers.
The average AEWR (Adverse Effect Wage Rate) in FY17 was $12.20 an hour or $525 for a 43-hour week. Over 26 weeks, an H-2A worker would earn $13,650 and 100,000 H-2A workers would earn $1.36 billion. If 150,000 H-2A workers are in the U.S. in FY17, their total earnings would be about $2 billion.
The DOL sued G Farms of El Mirage, Arizona for housing 69 Mexican H-2A workers in substandard housing and not paying them the AEWR of $10.95 an hour. Santiago Gonzalez grows watermelons and onions near Phoenix, and said he fixed housing problems as soon as the DOL notified him of them, making the DOL's suit unnecessary.
Gonzalez admitted that some H-2A workers did not receive the AEWR when they began to work because they were learning how to do the job; G Farms paid piece rates to harvest onions of $0.13 to $0.70 a bag.
County agricultural commissioners released reports of 2016 revenue in summer 2017. Kern County led the state in farm sales, with $7.2 billion worth of commodities sold, led by grapes, almonds, citrus, pistachios and milk.
Monterey County farm sales fell from $4.7 billion to $4.3 billion, largely because of lower vegetable sales of $2.8 billion in 2016. Leaf ($785 million) and head ($480 million) lettuce was the major crop in Monterey, followed by strawberries, $725 million, and broccoli, $390 million.
The Los Angeles Times reviewed the status of mechanization in various crops July 21, 2017, emphasizing the large number of prototype machines in development to replace hand workers. From apples to strawberries, tech firms are developing machines to harvest crops.
Asparagus acreage is declining, and many leafy greens are harvested mechanically with knives or water jet cutters. Urban tech firms want radical changes in farming to facilitate mechanization, while firms such as Ramsay Highlander in Salinas stress the productivity gains from incremental changes such as conveyor belts to make hand workers more productive. Machines are being used to plant lettuce so that it does not have to be thinned.
Christopher Ranch, which hires 600 workers to pack and process 90 million pounds of garlic a year at its plant in Gilroy, saw a surge in applications after raising packing shed wages from $11 to $13 an hour in 2017; the firm's minimum wage is scheduled to increase to $15 in 2018. The wages of more skilled packing shed workers rose as well. Christopher uses FLC (Farm Labor Contractor) crews and H-2A workers in the fields, where workers are paid piece rates.
The San Joaquin Valley Air Pollution Control District, the state's largest, wants to delay implementation of the tighter standards on particulates required by the federal Clean Air Act. The District, which covers eight counties with four million residents from San Joaquin to Kern, is a natural bowl with mountains on three sides that has been unable to improve regional air quality.
Fresno County had 25 unhealthy air warnings in 2016. One consequence is asthma, as especially children have trouble breathing. Many children carry inhalers to school and elsewhere.
California is responsible for one percent of global emissions of greenhouse gases. Governor Jerry Brown in July 2017 persuaded the Legislature to support the extension of the state's 2012 cap-and-trade program to reduce greenhouse gas emissions from 431 million metric tons in 2020 to 260 million metric tons in 2030 (AB 398). California emitted 440 million metric tons of greenhouse gases in 2015 and Brown warned of "mass migrations, vector diseases, forest fires, Southern California burning up" if the state failed to reduce them.
The extension of cap-and-trade could raise gas prices up to $0.75 a gallon and provide funds for the bullet train that aims to link northern and southern California. The California's Air Resources Board, which will implement AB 398, projects an increase in the number of electric cars from 250,000 in 2017 to 4.2 million in 2030. CARB is targeting manure on dairies to reduce methane emissions.
A Spring 2017 Washington Post survey found that rural Americans are uneasy about the changing demographics of the U.S. and believe their Christianity is under attack as the federal government caters to urban residents. For example, 42 percent of rural residents agree that immigrants are mostly a drain on the U.S., compared with 16 percent of urban residents. Two-thirds of rural residents say cracking down on illegal migrants would improve job prospects in their areas.
Rural was defined as non-metro counties and counties near population centers with up to 250,000 people, so that a quarter of Americans were considered rural in the poll. Pollsters say that the underlying issue is fairness, with rural residents skeptical of whom the federal government favors and helps.
Rural areas have had a weaker recovery from the 2008-09 recession than urban areas, and job growth has not returned to 2007 levels, prompting rural youth to leave for education and jobs and not return. A third of rural residents said that jobs and drug abuse were the biggest problems confronting their community, compared with 10 percent of urban residents.
The Wall Street Journal reported on May 26, 2017 that the total rural population declined in each of the past five years. Births in rural counties are declining, deaths are rising, and the median age of 41 is higher than the median 35 in large metro areas. Male labor force participation in rural counties is declining, and there are 60 disabled workers per 1,000 working age residents in rural counties, double the 30 per 1,000 rate in large metro areas.
The California Department of Water Resources reported in April 2017 that 90 inches of precipitation fell in the northern Sierra mountains, breaking the previous record set in 1982-83. California has one of the most variable climates in North America.
Most precipitation occurs during the winter months, and melting snow is moved from mountains in the north to farmers and urban consumers in the center and southern parts of the state via a system of dams and canals. The Sierra Nevada snowpack usually provides a third of the state's water supply.
Governor Jerry Brown proposed to move water around the environmentally sensitive Delta where the Sacramento and San Joaquin rivers empty into the San Francisco Bay by building twin tunnels expected to cost $16 billion. The California WaterFix is controversial, generally opposed by Delta residents and farmers. The water agencies south of the Delta are expected to decide by September 2017 whether they will help to pay for the project to move water around the Delta to pumps near Tracy.
Cadiz Inc owns about 50 square miles of land above a major aquifer in the Cadiz Valley, and wants to sell the water to southern California cities. The Mojave Desert Land Trust and most environmentalists oppose the project, but the Trump administration appears to favor allowing Cadiz to pump 50,000 acre feet of water a year from the aquifer.
California's fire season began in July 2017, with major fires around the state burning the grasses and shrubs that resulted from the record rainfall of 2016-17.
The number of Braceros admitted to the U.S. between 1942 and 1964 was almost five million. Many Mexicans returned year after year, so one to two million individuals accounted for the five million Bracero admissions.
During the peak year of 1956, over 445,000 Braceros were admitted to work on U.S. crop farms. Many Braceros were in the U.S. only for several months, so that an estimated 126,000 full-time equivalent jobs were filled by Braceros in 1956, a ratio of 3.5 Braceros per FTE job, suggesting that Braceros worked an average 3.4 months each. This average duration of three to four months was stable throughout the 1950s.
The average employment of hired workers on U.S. farms in 1956 was two million, suggesting that 126,000 FTE Braceros were six percent of the average hired farm workforce. Braceros were concentrated in California and other Pacific states, where there were an average of only 300,000 hired workers, making Braceros a third or more of average employment.
California, which had one of its wettest years ever in 2016-17, declared a drought emergency in January 2014 and ended it in April 2017. Over 30 inches of rain fell in parts of the Central Valley that normally receive less than 20 inches, and some Sierra mountain areas received over 60 feet of snow.
Instead of worrying about whether there would be enough water for summer irrigation, many water managers worried about having enough room in dams and reservoirs to prevent flooding. The water content of the Sierra snowpack, which normally peaks in April, was over 160 percent of average in April 2017, compared to five percent of average in April 2015. In 1983, the April Sierra snowpack had a water content that was over 200 percent of average.
California normally uses about 33 million acre feet of water, including 26 million acre feet for farming and nine million acre feet for consumers and industry. Among urban residents, half of water is used for lawns and landscaping.
In normal rain years, about 38 percent of the water used for agricultural irrigation is groundwater. During drought years, less surface water is conveyed via dams and canals, and groundwater is 60 percent of agricultural irrigation water. Land often subsides as water is pumped from underground, falling 50 feet or more in many areas of the San Joaquin Valley during the 2012-16 drought.
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 U.S. crop worker employment, followed by three states with 5 to 6 percent, Washington, Florida and Texas. Two more states have about 3 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 6 percent and Iowa and New York with almost 4 percent each, so that one 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.
California's farm sales fell from $54 billion in 2014 to $47 billion in 2015, largely because of the declining price of milk, whose value fell from $9.4 billion to $6.3 billion. The value of almonds fell by $0.5 billion, and the value of walnuts by almost $1 billion.
However, farmers are continue to plant more nuts. Bearing almond acreage has more than doubled from 418,000 acres in 1995 to 900,000 in 2016, and yields rose even faster from 370 million pounds to over two billion pounds. Walnut acreage rose from 177,000 in 1988 to 315,000 in 2016, and production more than doubled to 670,000 tons. California has 310,000 acres of pistachios expected to generate 555 million pounds in 2016.
Most nut farmers generate profits of $1,000 to $2,000 an acre, with pistachios the most profitable nut crop.
More acres of nuts are expected to come into production, including 220,000 acres of almonds, 70,000 acres of pistachios, and 65,000 acres of walnuts. The cost of establishing an acre of walnuts is estimated to be $3,800, an acre of almonds $2,300, and an acre of pistachios $1,900. Much of the new nut acreage is being developed by pension and hedge funds seeking current returns and capital gains as land prices rise.
California enacted a law in 2016 (SB 3) raising the minimum wage from $10 to $15 an hour by 2022 and requiring farmers to pay 8/40 overtime (AB 1066), that is, 1.5 times normal wages after eight hours a day and 40 hours a week by 2022 (employers with 25 or fewer employees have extra time to comply). The state's minimum wage went to $10.50 an hour on January 1, 2017.
Western Growers surveyed its members in November 2016, and 150 growers reported that they plan to increase mechanization (77 percent) and reduce production of labor-intensive crops in California (33 percent), including 60 growers who hired fewer than 100 workers at peak.
Responding growers reported that their employees worked an average 9.6 hours a day and 56 hours a week at $12.40 an hour, suggesting 5.5 day workweeks. Instead of paying overtime wages, most farms said they will reduce hours to 8/40, so that workers would be employed 16 fewer hours a week. A third of respondents said they would reduce benefits provided to farmworkers because of higher minimum wages and 8/40 overtime by having employees contribute more for heath insurance or reduce employer 401K and retirement contributions.
Fresno was the leading U.S. farm county until 2013, when the drought reduced irrigation water available to large farmers on the western side of the county. Fresno's farm sales for 2015 were $6.6 billion, down from $7 billion in 2014, and led by $1.2 billion worth of almonds from 186,000 acres and followed by $900 million for grapes from 195,000 acres. Fruit and nut crops worth $3.3 billion were half the value of Fresno farm sales.
Tulare county's farm sales dropped from $8.1 billion in 2014 to $6.9 billion in 2015, with lower milk prices for the county's 285 dairies explaining the drop.
There were many commodity stories in summer 2016. California's 900,000 acres of almonds are expected to produce a record two billion pound crop in 2016. Grower prices are expected to be about $2.50 a pound.
Table grape acreage is expanding to over 83,000 bearing acres. Workers in the San Joaquin Valley were being paid $10 to $10.50 an hour in summer 2016, plus $0.30 to $0.50 per 22-pound box, with a trio of two pickers and one packer sharing the piece rate. A trio picking 12 boxes an hour would share $3.60 to $6, or earn $11 to $13 an hour or $100 a day. Working six-day weeks for 18 weeks or 108 days, grape pickers could earn $10,800 or more a season.
Table olives have declined to 15,000 acres and 63,000 tons in 2016, in part because of the $500-a-ton cost of getting olives picked by hand. Many growers are shifting to nuts, which can be harvested mechanically.
There is not enough farmworker housing. A combination of economic incentives, stricter regulation of housing quality, and worker preferences suggests there will continue be a shortage of affordable and decent housing for seasonal farmworkers.
Until the 1960s, many farmers housed seasonal workers on their farms in a bid to attract them and to have workers available when they were needed. On-farm housing was often offered at little or no cost, and workers did not incur costs to commute to work.
Unionization and tenant rights, as well as tougher regulations and enforcement, encouraged many farmers to eliminate on-farm housing, which they could do in the 1970s, 1980s and 1990s and continue to attract workers because unauthorized migrants flooded into the United States. Today, most farmworkers live in farmworker cities, often crowded into single family homes, and many commute in car- and van-pools to work.
Federal and state governments operate farmworker housing centers, most of which give preference to families and offer a range of health, education and other services to workers and their children. Solo males generally live off of the farm and away from subsidized centers, especially when they work in short-season crops, such as the three-month table grape harvest in the Coachella Valley.
California needs more housing, but zoning laws that require developers to "maintain neighborhood character" and limit how many unrelated people can live together raise housing prices and slow the migration of poorer people to boom areas such as San Francisco. Many of the tech workers in San Francisco earn $150,000 to $200,000 a year, and the city's median house price in summer 2016 was $1.1 million.
By some estimates, United States GDP could be increased by 10 percent if zoning restrictions were eased so that poor people could move to richer areas and enjoy higher wages without spending their extra earnings on housing. A state law supported by Governor Jerry Brown would make it harder for cities to saddle developers with open-ended design, permit and environmental reviews. Many people in desirable places want to pull up the drawbridge, arguing that allowing more people into their cities would degrade the quality of life.
California's labor force in summer 2016 was 19.1 million, including 18.1 million who were employed. Los Angeles County has a labor force of five million, followed by 1.6 million each in Orange and San Diego counties, and almost one million each in Riverside and San Bernardino countries, that is, the five major southern California counties have almost 55 percent of the state's labor force.
About 16.5 million California workers are employed in nonfarm wage and salary jobs; there are 430,000 hired farm workers. Four sectors include two-thirds of the state's wage and salary workers: trade, three million, followed by professional and business services, education and health services, and government, which each employ 2.5 million.
California had a "normal" water year in 2010-11 and again in 2015-16. Droughts reduced the availability of water for the 2012, 2013, 2014 and 2015 crop years. However, farm sales climbed during the drought years, from $43 billion in 2011 to $47 billion in 2012 to $51 billion in 2013 and $54 billion in 2014. Sales in 2015 are expected to set another record.
The reason that farm sales rose even as the availability of water fell from the long-run average of 50 million acre-feet to a low of 31 million for the 2014 crop year was that farmers switched scarce and expensive water from low-value and water-intensive crops such as alfalfa to more valuable crops such as fruits, nuts and vegetables. About 500,000 acres were fallowed in 2014 and 2015, usually land that would normally be used to produce low-value field crops, and farmers pumped ground water to substitute for less surface water.
Monterey County, the nation's salad bowl, had farm sales of $4.5 billion in 2014, led by leaf lettuce worth $775 million, strawberries worth $709 million, and head lettuce worth $651 million. Vegetable crops were worth $3.1 billion and fruit crops $1 billion. A Farmworker Advisory Committee meets quarterly with the Agriculture Commissioner's office to discuss labor issues.
California is projected to have a record crop of table grapes in 2016, some 117 million 19-pound boxes worth almost $2 billion. The state has 100,000 acres of table grapes, and the Scarlet Royal and Autumn King varieties are replacing Thompson seedless, Crimson seedless and Red Globe varieties. Autumn King can generate 2,000 boxes an acre, compared with 1,000 boxes from an acre of Thompson seedless. A third of the state's table grapes are exported.
The 2015-16 water year was close to normal; the state's 154 major reservoirs held almost 22 million acre-feet of water on April 1, 2016, more than 85 percent of normal. Federal and state farm water contractors are likely to get half or more of the water that they want. Each water district contracts for a specific share of the surface water available to the federal Central Valley Project and the State Water Project, and CVP and SWP managers provide a percentage of each district's contracted water based on availability.
The California water system accumulates water as snow in northern California mountains and moves the water south via the Sacramento-San Joaquin river delta as the snow melts in summer. However, pumping water from the delta into the aqueduct that moves water south is often restricted to preserve juvenile fish that can be sucked into the pumps.
California requires overtime pay for farmworkers, one of four states to do so. In 1976 the 10/60 standard (that requires overtime after 10 hours a day or 60 a week, different than the standard eight hours a day and 40 hours a week for non-farmworkers) was established in 1976.
Across the U.S., workers hired directly by the farm that employed them averaged 41 hours of work in July 2015; California farmworkers averaged 43.6 hours. Most harvest workers are employed less than eight hours a day, but some work six days a week during the harvest. Workers most likely to be affected by an 8/40 overtime pay requirement are irrigators and equipment operators, who often work 60 or more hours a week during busy periods.
Sonoma County farm labor contractors (FLCs) Four Seasons Vineyard Management and Ridge Vineyards were fined $42,000 by the Department of Labor (DOL) in February 2016 for poor housing for farmworkers. Four Seasons deducted rent from the wages of workers and turned rental payments over to Ridge.
Two California Court of Appeals decisions in 2013 required employers to pay piece rate workers for nonproductive time and to pay them for rest periods at their average piece-rate earnings. Before these 2013 rulings, employers could pay only piece-rate wages to workers as long as their piece-rate earnings exceeded the minimum wage.
Many workers planned to sue for back wages. AB 1513 gave employers a "safe harbor," allowing them to pay any back wages due piece-rate workers after July 1, 2012 without penalties. However, employers who faced suits for unpaid productive time and for using fictitious workers to reduce wages were excluded from the safe harbor.
Two farms are affected by these exclusions, Gerawan Farming and Fowler Packaging. Both face United Farm Workers-initiated suits, and both sued in January 2016 to have the AB 1513 exemption declared unconstitutional.
California's minimum wage went to $10 an hour January 1, 2016.
California in April 2016 approved SB 3 to raise the state's $10 an hour minimum wage to $15 by 2022 for large employers, and by 2023 for employers with 25 or fewer workers. The minimum wage will rise by $1 an hour in January each year beginning in 2017, and increase with inflation from 2024. The governor can suspend minimum wage increases for a year in recessions or if there are serious budget crises.
SB 3 was enacted to head off a $15 an hour union-sponsored initiative on the November 2016 ballot that was expected to be approved by voters.
The minimum wage increase is expected to affect 5.4 million of California's 15.1 million workers, raising their wages by an average $2.20 an hour or $3,700 a year. The University of California, Berkeley's Center for Labor Research and Education estimates that almost 40 percent of those affected by the $15 minimum wage are 20 to 29, and that over half have a high school education or less. Over 55 percent of those expected to benefit from the rising minimum wage are Latino. A third of California workers affected are in retail trade and food services; less than five percent are in agriculture.
County agricultural commissioners released reports of the value of commodities produced the year before. Tulare County had farm sales of $8 billion in 2014, led by $2.5 billion worth of milk, followed by Kern country's $7.5 billion led by grapes worth $1.7 billion. Fresno county had farm sales of $7 billion, led by $1.3 billion worth of almonds.
California produces 20 percent of U.S. milk, but the state's milk output declined in 2015 as farmers grappled with higher feed costs attributed to drought. California surpassed Wisconsin as the leading dairy state in the early 1990s, but in recent years milk output has increased in Michigan, New York and Wisconsin, states with lower-cost land and plenty of water for pasture and feed. Milk prices have also fallen to less than $17 a hundredweight in Fall 2015, reflecting a global surge in milk production.
California's minimum wage rose from $9 to $10 an hour January 1, 2016.
AB 20, which would have required the state to initiate discussions with the federal government to seek a waiver that would allow the state's Employment Development Department to issue work permits to unauthorized farm workers if there are not enough U.S. workers to fill available jobs, stalled in the Legislature in 2015 and was not approved. Under AB 20, the immediate family members of workers with permits could have received permits to reside legally in California.
Kansas, Utah and Colorado tried to create similar state-facilitated guest worker programs, but the federal government did not grant required waivers, so these states wound up with state-run programs to help farm employers to apply for guest workers under the H-2A program.