The fresh produce industry in the United States, heavily reliant on H-2A workers, faces increasing challenges due to rising labor costs. Farmers who employ H-2A guest workers allocate a substantial portion of their expenses—38% on average—to labor. With wages under the Adverse Effect Wage Rate (AEWR) set to increase by 4.5% on average in 2025, many producers are grappling with the financial strain of maintaining profitability in a competitive global market.
The recently released USDA Farm Labor report sets the stage for the upcoming wage adjustments, which vary significantly by region. While some areas, like the Delta region (Mississippi, Louisiana, and Arkansas), will see relatively lower rates of $14.83 per hour, others, such as Hawaii, will experience the highest wage at $20.08 per hour, a 7.2% increase from 2024. California, the third-largest employer of H-2A workers, will require employers to pay $19.97 per hour, a modest 1% increase compared to previous years of steep wage growth. Such variations underscore the geographic disparity in labor costs faced by fresh produce farmers.
The financial burden extends beyond wages. Employers using the H-2A program must also cover transportation, housing, and other administrative costs. These expenses, coupled with the requirement to immediately implement wage increases upon certification in December, amplify the financial and logistical pressures on producers. The removal of the traditional 14-day implementation period, contested by 17 states in a lawsuit, adds further complexity, with differing requirements for employers across the country.
For fresh produce farmers, who compete globally with producers paying significantly lower wages, these rising labor costs represent a critical challenge. As domestic workers increasingly shift away from agricultural labor, reliance on the H-2A program continues to grow. To remain competitive, U.S. specialty crop producers must navigate the dual pressures of rising operational costs and a global market that offers no such constraints. Innovative strategies and policy interventions may be essential to ensure the sustainability of the industry in the face of these mounting challenges.
For more information:
American Farm Bureau Federation
Tel: +1 (202) 406 3600
Email: [email protected]
www.fb.org