Farms Used Less Labor When U.S. Got Rid of Guest Workers, Research Finds

There is an economic argument to limiting immigration to the U.S.: Cut down on the supply of foreign labor, and wages will improve for native-born Americans. But new research shows the equation isn’t that simple. A team of economists looked at the midcentury “bracero” program, which allowed nearly half a million seasonal farmworkers a year into the U.S. from Mexico. The Johnson administration terminated the program in 1964, creating a large-scale experiment on labor supply and demand.  The result wasn’t good news for American workers. Instead of hiring more native-born Americans at higher wages, farmers automated, changed crops or reduced production.  “We find that bracero exclusion failed to raise wages or substantially raise employment for domestic workers in the sector,” the Center for Global Development’s Michael Clemens and Hannah Postel, and Dartmouth College’s Ethan Lewis said. Instead, “employers adjusted to foreign-worker exclusion by changing production techniques where that was possible, and changing production levels where it was not, with little change to the terms on which they demanded domestic labor.”  Indeed, wages in states with the heaviest concentration of braceros—Arizona, California, Nebraska, New Mexico, South Dakota and Texas—rose more slowly after the program ended than wages in states that had no such guest workers. Employment of local workers rose at the same pace in bracero as nonbracero states.