Government: Distorting the Labor Market

Right From the Start

Several months ago, Danny Westneat, a columnist for the Seattle Times, was complaining that the crackdown on illegal immigrants was having an adverse impact on Washington produce growers:

“Nope. It hasn’t happened. Farm jobs are going unfilled to such a degree that now a huge fruit orchard in Okanogan County, desperate for someone to pick cherries and apples this summer, has turned to flying in hundreds of workers from … Jamaica.

“That’s right. From a Caribbean island more than 3,000 miles away.”

Westneat stated that produce growers had advertised jobs that would pay about $12.20 per hour for those picking apples and $16.50 per hour for those picking cherries. In neither instance were they able to attract local workers.

Westneat then noted:

“Lately, we’re on a get-tough kick with illegal workers. That would be fine — except for the part where we won’t do the work ourselves. At least not for the pay rates the farm economy says it requires (Appel says he doubts pay of $20 an hour would draw any U.S. applicants.)

“So in trying to get tough, instead we get absurd. Firing hundreds of trained workers who already live here while being forced to jet in new ones from thousands of miles away.”

Great story but there are a couple of holes in it.

There’s a reason that you can’t attract local workers for these jobs and it has nothing to do with immigration policy and probably little to do with whether the growers are offering a sufficient wage.

According to the Washington State Department of Employment Security, unemployment benefits pay workers about $570 per week – that’s about $29,640 per year or about $14.80 per hour. In addition to the unemployment payments you can qualify for food assistance and free medical care.

Picking any crop is hard work. It should be no surprise that if you are willing to pay someone $14.80 per hour to sit on their duff, they are probably not going to take on hard work picking cherries for an extra $1.70 per hour let alone a cut of $2.60 per hour to pick apples. The fact of the matter is that government has distorted the labor market by paying people in excess of what some jobs will pay. Until people have to make the choice between accepting hard jobs and not eating we can not determine what the true market value of labor is for picking produce.

Congress continued the distortion of the market by extending unemployment benefits for another thirteen months – thirteen months.

The idea of paying unemployment compensation to people who have lost their jobs is a good one. Even the idea of allowing people to refuse work that is not equivalent to their previous employment is a good idea for a limited period of time. Both of those “good ideas” have been tossed in the waste can. I would suggest that the laws relating to unemployment compensation be amended to allow people to look for comparable jobs for the first twenty-six weeks and thereafter they should be required to take any job paying above minimum wage that they are physically capable of performing or lose their unemployment compensation.

My guess is that if that rule applied in Washington currently, the growers would not have found any difficulty filling jobs at $12.20 per hour or $16.50 per hour.

There are two other parts of the Westneat article that bother me. First, there is an innate racist attitude to believe these jobs are appropriate for brown people from Latin America, or black people from Jamaica, but unsuitable for white people from Central Washington.

And second, if Westneat had his way and legalized all of the current illegals, they too would qualify for unemployment and food stamps and soon enough they wouldn’t undertake hard work for wages that approximated what they could get for doing nothing on unemployment.