With the tightening in the regulations regarding migrant workers, the nursery and greenhouse industry is facing a critical shortage of labor (Posadas et al., 2004). Migrant labor issues are a major concern facing agriculture and especially the horticultural industry in the United States (Bellenger et al., 2008).
Workers in this industry perform varied functions and are subjected to different working conditions (O*Net Online, 2012). Posadas et al. (2008) reported that at least 8 of the 15 major tasks were performed by workers with significant number of nurseries using mechanized or automated systems in media preparation, filling containers with substrates, moving containers from potting to transport, transporting containers to field, plant pruning, and fertilizer, pesticide, and irrigation application. Six of the 10 major tasks were performed by workers employed by a significant number of greenhouse operations with mechanized or automated systems in media preparation; filling containers with substrates; environmental control; and fertilizer, pesticide, and irrigation application. Very few nurseries or greenhouses were using mechanized or automated systems in cutting and seed collection and preparation; placing plant liners; sticking cuttings and planting seed; harvesting and grading production; spacing of plants and containers; removal, picking up, loading, and placing of plants; and jamming of plants for winter protection.
The nursery and greenhouse industry is often described as one of the fastest-growing sectors of U.S. agriculture and is inherently labor intensive (Regelbrugge, 2007) with greater than 40% of production costs consisting of labor costs (Mathers et al., 2010). Hodges et al. (2011) estimated the total economic impact of the U.S. green industry at $175.26 billion representing ≈0.76% of the national gross domestic product in 2007. The U.S. green industry generated a TEI of 1.95 million jobs, labor earnings impact of $53.16 billion, and value-added impact of $107.16 billion.
To sustain robust growth in the industry, continuous improvements in the skills of the workforce and their year-round availability are necessary. Many jobs in the industry require large amounts of stooping, lifting of heavy containers, and exposure to chemicals, dust, and plant materials (Bureau of Labor Statistics, 2012b). These tend to be relatively low-paying jobs, with median wages in 2010 amounting to $8.98 per hour or $18,690 per year (O*Net Online, 2012), making it difficult for managers to compete for and retain workers in currently tight domestic labor markets. Many commercial operations have employed immigrant labor, which is mostly less skilled, to meet their rising labor requirements. The nursery migrant workforce are employed, on average 6 months, and most stayed for 10 months (Mathers et al., 2010). In the long run, there is a need to increase the skill level of these migrant workers to improve wage rates, recruitment, and retention of workers.
Mechanization of an operation can provide mechanical power, speed, repetition, safety, and a greater potential for consistency and quality control. Mechanization is normally defined as the replacement of a human task with a machine (Giacomelli, 2002). Automation includes these attributes, but with greater flexibility and, potentially, some automated decision making (Giacomelli, 2002). But true automation encompasses more than mechanization. Automation involves the entire process, including bringing material to and from the mechanized equipment. It normally involves integrating several operations and ensuring that the different pieces of equipment communicate with one another to ensure smooth operation. Many times, true automation requires reevaluating and changing current processes rather than simply mechanizing them (Porter, 2002). The possible benefits associated with automation were summarized by Ling (1994) as follows: reduce manual labor requirement, improve production quality, eliminate hazardous working conditions, reduce production costs, increase market value, and improve professional esteem. Simonton (1992) concluded that the benefits and incentives to automate are significant and include improving the safety of the work force and the environment, along with ensuring sufficient productivity to compete in today’s global market.
Given the above-mentioned expected benefits and the tightening labor markets faced by the nursery and greenhouse industry, this article evaluated the economic impacts associated with mechanization and automation by using socioeconomic databases collected in previous surveys. The specific objective of this article was to measure the economic impacts of mechanization or automation on the horticulture firms’ total revenues (TR), annual employment, and workers’ earnings, skills, training, safety, and retention rates.
This article is a spatially, temporally, and analytically expanded version of an earlier article which covered 87 growers located in the three northern Gulf of Mexico states (Posadas et al., 2008). With the data collected by face-to-face interviews of nurseries and greenhouses, multiple linear regression analysis was applied to estimate empirical models to measure the socioeconomic impact of automation or mechanization on annual gross sales; annual employment; and workers’ earnings, safety, and retention. In this article, there are more southern states included in the study (eight vs. three states), covered a longer period (2003 to 2007 vs. 2003 to 2009), and included more producers (87 vs. 215 growers). Because of the longer period covered in the study, this article used deflated values of annual gross sales and total workers’ earnings and hourly wage rates and also added the interview date as an explanatory variable. Additional variant models were estimated where the number of full-time equivalent (FTE) workers was segregated into permanent workers (PW) and part-time workers (PTW). The segregation allowed for the comparison of the VMP of the PW and PTW.
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