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Time growing shorter for guestworker proposal as dairy labor challenges mount

Progressive Dairyman Editor Dave Natzke Published on 12 September 2018

After Sept. 14, the full House is scheduled to be in session just 12 days prior to elections in early November. With limited days and a full slate of issues to tackle, dairy organization leaders continue to push Congress for a bill to address the industry’s growing labor needs.

Laurie Fischer, CEO of the American Dairy Coalition, urged fellow dairy producers to press Congress to pass the AG and Legal Workforce Act, introduced in July by U.S. Rep. Bob Goodlatte, R-Virginia, chairman of the House Judiciary Committee. Its co-sponsors include both House Agriculture Committee Chairman Mike Conaway, R-Texas, and ranking member Collin Peterson, D-Minnesota.

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The proposal would establish a guestworker program for the dairy industry and mandate use of the federal E-Verify system to ensure all temporary, nonimmigrant workers are vetted by the Department of Homeland Security. However, the bill, HR 6417, has failed to garner enough support for a vote in the House.

“The AG Act must be passed concurrently with employee verification tools,” she said. “Passing mandatory E-verify without allowing for a method for our nation’s farmers to secure reliable labor would be devastating to the sustainability of the dairy industry. We must have a solution to resolve both issues in a parallel fashion.”

National Milk Producers Federation (NMPF) president and CEO Jim Mulhern is hopeful Congress will revisit the immigration issue. “We know there are many [House] members in both parties who are eager to forge solutions to these complicated issues, and we are hopeful that this is not the end of the process. Dairy cannot wait any longer,” he said.

CoBank study

Dairy’s labor dilemma was recently described in a comprehensive study report from CoBank’s Knowledge Exchange division. The study, “Help Wanted,” notes that in a tightening labor market, manual laborers are chasing higher wages offered in other industries, leading to labor scarcity and wage inflation that threaten the rural economy and farm profitability at a time of depressed commodity prices.

“Ultimately, the risk to the agriculture sector or any domestic industry is that wages will increase to the point where it becomes more cost-effective for the U.S. to import commodities rather than import the labor to produce them domestically,” said Ben Laine, a senior economist with CoBank.

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Dairy operators find themselves on shaky ground as U.S. Immigration and Customs Enforcement (ICE) officials ramp up the arrest, detention and deportation of undocumented farm workers. Additionally, dairy producers aren’t able to use the current H-2A visa program because it restricts visas to only temporary and seasonal work. (Goodlatte’s bill calls for creation of a H-2C visa program, providing year-round work visas.)

The scarcity of farm labor is exacerbated by the shrinking number of migrant workers from Mexico. In addition to immigration controls, birth rates in Mexico are falling and populations are moving toward urban areas, leaving fewer people with agricultural backgrounds who would be interested in U.S. farm work.

New York, Washington dairy farmers featured

The CoBank report features the experiences of dairy producers in New York and Washington.

Upstate New York dairy producers like Peter Braun have little choice but to wait and see if the H-2C visa will ever become a reality. Braun and his father-in-law/partner, Robert Cruikshank, operate Woodcrest Dairy, a 3,000-cow, 5,000-acre operation near Lisbon, a town where the dairy cows outnumber the people.

It takes 36 employees, milking 3X, to staff the dairy’s four milking parlors. Woodcrest employs another 30 workers who feed, care for calves, and assist with crop planting and harvesting.

“Milkers and cow handlers are the biggest chunk of our labor,” said Braun. “That’s the area where we are always needing more help.”

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Absenteeism is a constant worry. Braun schedules an extra worker per shift at every milking facility, just in case someone doesn’t report for work.

“Cows with full udders don’t care that somebody called in sick or just didn’t show up. And that happens here – a lot,” he said.

Employee turnover is also a problem. Last year, Braun issued 150 W-2 forms (Internal Revenue Service wage and tax statements), indicating he employed an average 2.3 workers for each paid position on the farm.

Three of Woodcrest’s milking parlors are situated less than two miles from the Canadian border – a fact that altered the farm’s worker demographics about a decade ago. Braun and his partner chose to stop employing workers from Mexico after two of their farms were raided by U.S. Border Patrol agents.

Though the farm had the required documentation for each employee, more than a dozen workers – including two placed there by the New York State Department of Labor – were removed, leaving the farm severely short-handed in its milking parlors.

A desperate Braun was “hiring guys off the street” just to get his cows milked. “We lost a ton of production when all that happened,” he recalled.

Today, most of Woodcrest’s current milkers are Puerto Rican. About two-thirds of them are permanently settled in St. Lawrence County where Woodcrest is located. But another third represent an ever-changing cast as workers float between their island home and New York. Islanders are not required to secure a visa since they reside in a U.S. territory.

The farm’s payroll also includes a few members of the county’s Amish community. Though extremely reliable, these workers have many limitations due to their religious beliefs. The Amish can’t use mechanized equipment, so they won’t work in the milking parlor, drive a truck, or operate feed or harvesting equipment.

They won’t work at night or on Sundays, either. Woodcrest pays milkers $12 an hour, which is about $2 above New York’s minimum wage. Truck drivers command a higher wage. The math isn’t working, said Braun.

“We can’t keep this up while we’re getting just $14 [per hundredweight] for our milk,” he said.

Relying on robots

On the other side of the country, Washington state dairy farmer Leroy Plagerman isn’t waiting for a congressional fix to his labor problems. Instead, he’s relying on technology.

Plagerman and his family milk about 1,000 cows on two farms in Whatcom County, which shares a border with Canada’s British Columbia province. Last fall, the family upgraded one farm, installing eight robotic milkers and computerized feeding and waste management systems.

Difficulty finding milkers motivated Plagerman’s switch to automation. He was forced to scale back from 3X- to 2X-milkings daily when he couldn’t find reliable help to work the night shift. Both milk production and overall cow performance dropped. That’s when the Darigold co-op member began looking for a better option.

Now, he has a dairy that operates with minimal human help. Plagerman’s daughter, Jana, handles calf care and other jobs with the help of just one additional employee.

“Our labor is one-third of what it was before,” said Plagerman. “Plus, what we are saving in labor costs is covering two-thirds of the monthly robot payment.”

The math is working in other ways, too. The herd’s milk production has climbed 12 percent and reproduction rates have also increased.

“With robotics, we went away from managing people to managing cows,” Plagerman said, explaining that data collected by the robots contributes to better herd health. He expects his $2 million automation investment to pay off in about four years despite the current dairy price environment. “I think a four-year return is awesome,” he said.

Only two months into the automated operation, Plagerman was convinced that his investment was well worth it. He plans to convert his other dairy as soon as it’s financially feasible.

The study report, “Help Wanted,” is available from CoBank.  end mark

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