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Labor pressures add up as New York dairy farms struggle to survive

The tight labor market could be exacerbated by new workers’ rights proposals.

April 9, 2019

7 Min Read
David Wood, owner of Eildon Tweed Farm, beside cows in the barn
UNCERTAIN FUTURE: David Wood, owner of Eildon Tweed Farm, says low unemployment has made it more difficult than ever for him to find reliable workers.

By Paul Post

New York dairy farmers, already struggling with a fourth-straight year of low milk prices, are also being squeezed by state and federal policies that are driving up labor costs.

Combined with the state’s low 3.9% unemployment rate, farmers say they can’t find the help needed to fill critical jobs, even with an increased minimum wage that’s scheduled to reach $12.50 an hour on Dec. 31, 2020 and the possibility of mandatory overtime pay.

“Anything that increases wages is very hurtful for dairy farmers in a down economy,” says David Wood, owner of Eildon Tweed Farm, one of Saratoga County’s largest producers. “But that pales in comparison to the lack of farm labor. It’s very difficult to find people. Any time unemployment is below 5% we’re in trouble because people that are available have lots of good jobs to choose from.”

Wood employs nearly 30 people and has an ongoing need for mechanics and drivers to haul out manure and bring in feed.

“I’ve had an ad running for six months,” he says. “The big thing is having people who want to come, have the experience necessary for the job and like this type of work.”

A long-term problem

New York Farm Bureau is calling for a change to the H-2A visa program. At present, it only allows visas for seasonal employees such as migrant fruit pickers. New York is among the top 10 states for H-2A program utilization and had an 11% increase for such workers in the past two years.

“This reflects the tightening local labor market and the need to not only fix H-2A, but have a system for all farms, not just seasonal operations,” says David Fisher, New York Farm Bureau president.

Lauren Williams, Farm Bureau senior associate for national affairs, says expanding the H-2A program to include dairy would address “the current workforce that may not be documented and get them into a visa program, giving them some type of status.”

“It would give us an avenue to bring in workers legally who could stay 12 months,” says Mike Barnes of CoBar Dairy LLC in central New York. “That’s all we’re asking for, is a way to access good hard-working people who want to work.”

Barnes is also treasurer of the Agri-Mark Cooperative and a member of the New York State Milk Marketing Advisory Council.

“We put an ad in the paper for a weekend feeder and didn’t even get a call back,” he says. “Local people just don’t want to do the work or they can find it elsewhere. And Hispanics, with everything going on with deportation and immigration, they’re getting harder to find, too.”

Barbara Reardon, state labor commissioner, says she’s concerned about the need to train and develop farmworkers and future farm owners. She recently took part in a statewide Agriculture Literacy Week initiative, visiting schools to spark young people’s interest in farm-related occupations.

“Technology is changing the face of farming a lot,” she says. “We want young people to understand that if you go into agriculture now, it’s not just putting things in the ground or milking a cow. There’s a lot of computer science and ag science. It’s a very exciting part of the industry.”

Farmers who need help now can’t wait for the next generation of workers to come along.

“Federal immigration policy for agriculture could be solved within six months, from legislation to implementation,” says Andrew Novakovic, former USDA senior economist and current professor of agricultural economics at Cornell. “There have been a number of decent proposals, and certainly programs that dairy or ag industry leaders have endorsed. The problem is not figuring out what to do, the challenge has been finding agreement that this is a problem we actually want to solve.”

Unfortunately for dairy farmers, “no one is holding their breath expecting a resolution any time soon,” he says.

Farmers don’t necessarily prefer foreign workers, “they only turned to immigrant labor when they could not find local people willing to do the job,” he says. “This is not entirely a reflection of wage scales. Many farmers have told stories of offering local people wages that were completely competitive with good local jobs, but still not being able to find people able or willing to do the work.

“Able does not mean having previous knowledge or training about farm work. It includes both being willing to learn and wanting to learn. It was the unavailability of a local labor supply that drove dairy farmers to seek immigrant workers. This is a market failure more than a failure of immigration or labor policy.”

Labor pressures adding up

Farm Bureau is also concerned about a proposed farmworker labor bill that calls for overtime on a 40-hour work week in the state. A recent Farm Credit East report says this would increase farm labor costs nearly $300 million or more than 17%.

That would take a significant bite out of net farm income at a time when the farm economy is suffering. When combined with the rising minimum wage, net farm income will drop by 23%, the report says.

Barnes says his 500-cow dairy is currently operating below cost of production. He gets about $17 per cwt for his milk but spends $17.50 to make it.

“Our Hispanic workers request at least 70 hours per week,” he says. “They just want to make money. That’s what they’re here for.”

Barnes says that he’s done a cost analysis and has determined that he would have to hire an additional five people if the farmworker labor bill becomes law as it would be cheaper than paying overtime.

Miguel Ramirez hoses down a milk tank at Eildon Tweed Farm
LONG HOURS, HARD WORK: Miguel Ramirez hoses down a milk tank at Eildon Tweed Farm. A proposed state bill would require farmers to pay overtime, but farmers worry it will be too costly at a time when the dairy industry is slumping.

“One way or another it’s going to cost us,” he says. “It’s coming out of a pretty skinny milk check right now.”

“Labor costs in New York state are substantially higher compared to neighboring states and other countries that compete against our farmers in the marketplace,” says Steve Ammerman, Farm Bureau spokesman. “The rising minimum wage and the threat of additional labor mandates from the farm labor bill would add to that burden. New York growers can only charge what the market will bear and simply can’t raise prices to recoup high labor costs. The same goes for dairy producers who do not control the price they receive for their product either.”

On another front, Farm Bureau is concerned about an element of the bill that would allow collective bargaining and give workers the right to strike.

“As it is currently written, this would allow for strikes during planting or harvest, which could ruin a season’s crop,” Ammerman says. “It could also put animal health in jeopardy.”

In January 2018, state Supreme Court Judge Richard McNally granted Farm Bureau’s request to dismiss a New York Civil Liberties Union lawsuit that sought to grant farmworkers collective bargaining rights. But the Civil Liberties Union appealed and arguments were heard in February in the Appellate Court.

Farm Bureau’s attorney, Brian Butler, argued that a change in law must be made by the Legislature, not the courts, and that the State Employment Relations Act is constitutional as written.

A decision on the Civil Liberties Union’s appeal is pending.

Novakovic says state officials should seriously consider the consequences of imposing labor laws designed for factories on farms.

“If doing so ends up making New York farmers uncompetitive with farms in neighboring states or even farther afield and that then results in those farms going out of business, then state government may want to think about the tradeoff of providing better-paying jobs against having no jobs,” he says.

Robots not for everyone

Of course, some farms have installed robotic milking machines to reduce labor costs, which Novakovic sees as a viable option.
“Farmers have been using all kinds of computer-assisted technologies for years and each year the costs of these systems goes down and their reliability goes up,” he says. “Robots can milk cows. Tractors can drive themselves. Computers assist with management tasks such as accounting and human resources.”

O.A. Borden and Sons Inc., a 127-cow dairy in Washington County, installed two robots five years ago for more than $400,000. In a perfect world, the move would have worked out fine. But co-owner Tom Borden says milk prices have been so low that he might not be able to finish paying for the machines before they wear out.

“We’re very frustrated,” he says. “It’s sad. If we knew what the milk price was going to be we wouldn’t have done it.”

Robots reduce the need for labor, but they still require attention.

“And you can’t predict when it will be needed,” he says. “I got called down to the barn last night at midnight because a cow wouldn’t leave the robot.”

Post writes from eastern New York.

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