How Immigration Could Affect Your Grocery Bill

Today, the United States is home to the largest immigrant population in the world. While much immigration-related debate centers on social issues, immigration’s economic effects are clear-cut it increases potential economic output by increasing the size of the labor force.

While inflation fears grip the U.S., the war in Ukraine has caused skyrocketing costs for farmers here. The price of agricultural chemicals such as fertilizers and pesticides has risen 50% over the past year, as Russia is a significant exporter of nitrogen, potassium, and phosphorous fertilizers. As a result, certain consumer goods are getting scarce, and meat and poultry are in short supply in many supermarkets. In addition, a combination of expensive crops to feed livestock and chickens, high transportation costs, and shortages of packaging materials may cause dairy shortages.

In the last two years “over half the farmers responding to a recent Purdue University survey say they’ve faced labor shortages. Many say they’ve also had difficulty maintaining adequate qualified workforces.”

Echoing the survey, Tyson Foods CEO Donnie King told quarterly earnings to call in February that “Customer demand continues to outpace our ability to supply products.” And labor shortages, as well as material shortages, may impact grocery shelves, with fewer transportation workers and grocery workers available to keep them stocked.

While the correlation between the rising prices and immigration may not be apparent, less immigrant labor in the U.S contributes to price hikes. The health of America’s farms and of the entire agriculture industry is tied directly to immigration. As recently as 2019, 48.9 percent of all agricultural workers were foreign-born, and more than one-fourth were undocumented. In many states where agriculture is essential, immigrants make up even larger percentages of the farm workforce; in California, immigrants comprise more than 80 percent.

The COVID-19 pandemic crippled the U.S. labor market, making it harder for all employers, farmers included.

By Raymond G. Lahoud
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