Jan 18 2009
Competition and rising costs force Southwestern farmers to consider alternatives
Published by Jason Welker at 8:45 pm under Competition,Cost-minimization,Perfect competition,Technology
NPR : Farmers May Switch Crops Due to Labor Shortage
Pure competition forces firms to produce their output in the most efficient manner. Productive efficiency is achieved when producers achieve their minimum average total cost. Any increase in costs may lead to economic losses for a firm, and if costs increase too much a firm may be forced to shut down.
The scenario above is basically a textbook explanation of the reality faced by farmers in the American Southwest this very day. Hundreds of fruit and vegetable farmers are facing higher variable costs as tougher border security and immigration laws has led to a shortage of cheap labor, which the farmers depend on in the labor-intensive fruit and vegetable industry.
Listen to the podcast above, then study the graphs that accompany this article.
Rising costs for in a perfectly-competitive (PC) industry: Click on the thumbnails of the graphs to see the full-sized versions
Discussion Questions:
- What changes have occurred in the American fruit and vegetable industry?
- What are the possible outcomes for Southwest farmers?
- How might technology help save these growers from having to shut down their operations?
- What other alternatives do they have to shutting down in the long run?
About the author: Jason Welker teaches International Baccalaureate and Advanced Placement Economics at Zurich International School in Switzerland. In addition to publishing various online resources for economics students and teachers, Jason developed the online version of the Economics course for the IB and is has authored two Economics textbooks: Pearson Baccalaureate’s Economics for the IB Diploma and REA’s AP Macroeconomics Crash Course.
Jason is a native of the Pacific Northwest of the United States, and is a passionate adventurer, who considers himself a skier / mountain biker who teaches Economics in his free time. He and his wife keep a ski chalet in the mountains of Northern Idaho, which now that they live in the Swiss Alps gets far too little use. Read more posts by this authorRelated posts:
- Creative Destruction: Google, Apple, Facebook and the future of competition in the market for our minds…
- Dominican Republic struggles to find its “comparative advantage” as it faces new competition from Asia
- Review Lesson: Econ concepts in 60 seconds – Perfect Competition
- Red Storm Rising!! China bashing picks up steam…
- SAS Economists Podcast #3: Competition in the Baked Goods Market at SAS
Labor is a factor of explicit costs, therefore, with the shortage of cheap labor, average total costs would increase thus affecting economic profit. There will be a loss for Southwestern farmers in the short run. Because of the economic losses, firms will leave the industry, such as farmers leaving labor intensive crop industries such as strawberries, to machine harvested crops such as corn. This will decrease the supply. Because supply has decreased and demand is the same, the price will increase. The higher prices will attract new firms into the industry and consequently decrease the price back to long run equilibrium.
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The lack of labor seems to be a problem here. The green chilies cannot be harvested by machines and there for they have to use human labor to harvest. It's said that the lack of labor should increase the wages for farmers. However, it did not. And there are no signs of decreasing in vegetable and fruit production.
In the long run, I think that farmers should also plant other things too, not just be dependent on green chilies, this way they can still be earning some normal profit, meaning that they don't have to shut down in the long run.
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The lack of labor has caused farmers to switch products because fruits and vegetables such as strawberries and lettuce require farmers to hand pick it. Having a lack of labor causes inefficiency which causes them to not be very productive.
If farmers change to products such as wheat and corn, they have machines that can pick and process them. So a lack of labor would not be as big of a problem. In the short run, they'll be losing some money because they have to switch products and buy the new machines which will probably cost a lot. But in the long run they will break even because eventually they should be making enough money to make up for the machines and switch the product.
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The shortage of labor will lead to a more expensive product, unless something can be changed in the long run. Essentially with new technology and cheaper capital, farmers can invest the wages of workers into machinery in order to decrease harvest time and have a greater output of product, but money doesn't grow in fields. Most farmers can only afford the cheap illegal labor that is being taken away, in their current situation they can't even harvest enough of the good to sell it so they must instead harvest what they can and make littler or no profit.
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With the labor shortage, and the fact that labor is more intensive for harvesting crops such as lettuce, strawberries, and broccoli, many farmers have begun to changed their harvests to corn and such as they can be machine-harvested. Although, the farmers would in the short-run lose some money from switching the crops they're harvesting, they would in the long run, probably make a profit.
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A shortage in labor is the main problem and that is making the farmer's production inefficient. In the long run, the farmers would be best off investing in new machinery and switching to a different crop so as to cut down the number of variable inconsistancies in production.
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Just like the farmer in the voice clip states, their methods of crop harvesting must be changed in order to survive in the farming market. As the immigration laws and tougher border security eliminate the cheap labour, they have to manage their resources differently in the long run by;
1) Investing in more and better machinery so as to decrease their dependency on labor and reduce their AVC. Although their AFC might increase, they can still remain in the market if it surpasses the demand curve, but as shown in the third graph, if the AVC surpasses the demand curve, the firm can only decrease costs by shutting down.
2) The farmer can switch crops that demand less labor work.
3) He can move some of his operation to Mexico to continue to have cheap labor within reach for his crops.
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As Costs of Production have increased over the years, farmers have been forced to turn away from more labor-intensive farming. Instead, they are growing crops like corn, that don't require as much labor. The example used in the podcast was that of green chili peppers. The farmer had decided to instead use his resources to produce corn (ethanol). The farmer reasoned that with new immigration restrictions, he simply couldn't afford to harvest green chilies anymore. Without the cheap labor, farmers will have to consider moving their operations to Mexico where they can be competitive or shutting down. In other American markets, the unskilled labor force has been substituted with technology, making those industries more efficient. If these farmers had access to new technology that was capable of harvesting vegetables like green chilies, then they would be able to produce a greater amount with only a small labor force.
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What changes have occurred in the American fruit and vegetable industry?
American fruit and vegetable industry has moved from handpicking labor to heavy machinery harvest because farmers are experiencing shortage of cheap labor. Because the US government passed legislation that tightened immigration laws, there is a limit to the availability of Mexican people who were the major labor force of this industry.
What are the possible outcomes for Southwest farmers?
Because machines cannot harvest the hot pepper, farmers with labor shortage will face serious drops in their profit. Moreover, it is likely that these firms will fall below the normal profit and possibly shut down due to excessive costs.
How might technology help save these growers from having to shut down their operations?
Technology will help save these growers from having to shut down their operations because only two or three people are required to manipulate the harvester. Therefore, if these machines could replace the Mexican labor force, the farmers will perhaps earn more than they did because machines do not require wages to keep working.
What other alternatives do they have to shutting down in the long run?
One possible alternative that the hot pepper producer can do is to transplant the entire firm into Mexican territory where massive labor force is available at cheap wages. In doing so, the farmer will not face any legal issues and will continue to make profit out of the industry.
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What changes have occurred in the American fruit and vegetable industry?
A. There has been a shortage of immigrant labor within the United States due to increased regulation and restriction as well as a crackdown on illegal immigration. This has caused many farmers in the U.S. to be without labor. This is needed to grow and collect green chili. As a result, many acres where this would usually be grown are now being substituted for corn fields which can be cultivated mechanically.
What are the possible outcomes for Southwest farmers?
A. With fixed costs becoming more burdensome to meet, it will be very difficult for farmers to produce a lot of a good with high variable costs. This may result in an economic loss for the farmers and give them an incentive to rethink their business plan, much the same way as the man in the NPR broadcast did. In fact, some of them may need to leave the industry all together or move to an area where there is cheaper labor (such as in neighboring Mexico).
How might technology help save these growers from having to shut down their operations?
A. As is said in the podcast, some farmers have adapted to this new labor shortage and have began utilizing devices such as a converted tomato-picking machine. Though it breaks down often, picks up debris, and destroys green chili, it is effective in collecting red chili and takes only 2 – 3 workers to operate. This has the potential of saving the chili growers in the Southwest.
What other alternatives do they have to shutting down in the long run?
A. As I stated above, some farmers are considering moving their operations to Mexico where the supply of cheap labor is abundant. This option has actually been taken by some farmers as is noted within the NPR broadcast. Another option that has been tried (unsuccessfully) has been to hire illegal workers at extremely low prices. This, of course, is illegal and is not the most advisable path to take.
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Masaya,
Hi, I'm from the IB Economics HL Section A class. You make some very good points in your response. I think it is interesting to speculate whether these farmers will have to shut down their operations. It’s very good that you brought up the fact that they are not making normal profits, a fact illustrated by the thumbnail images provided for us above. As soon as that horizontal line drops below the AVC line, there will be no choice but for the firm to shut down.
Trevor Tezel
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What changes have occurred in the American fruit and vegetable industry?
Because of new laws restricting the movement of illegal immigrants from Mexico to the United States, there are fewer laborers available
to harvest fruits and vegetables. This is a problem because certain vegetables such as chilies can only be harvested by hand, and therefore farmers' variable costs have greatly increased.
What are the possible outcomes for Southwest farmers?
If no other solutions became available, the variable costs of the farmer's would rise to an extent that total cost would exceed total revenue, meaning that the farmer is operating at a lost. The loss would not be able to be sustained for a long period of time, so it is likely that a continuation of this situation would see many farms shut down or relocate.
How might technology help save these growers from having to shut down their operations?
What makes the US agricultural industry competitive is the advanced machinery that is used. This means that high levels of productivity can be achieved with relatively few inputs of labour. If this method can be replicated in the fruit and vegetable industry this would cause variable costs to fall and fixed costs to rise, making the industry more capital intensive. For example, the podcast describes a converted tomato-picking machine that has been modified to pick chillies. The machine is not perfect, but it only takes 2 to 3 people to run. However, technological development takes time and money that an individual farmer would not be able to afford.
What other alternatives do they have to shutting down in the long run?
Some Southwest farmers have decided to avoid rising variable costs by shutting down their operations in the US and moving to Mexico, where they are able to draw from a large supply of cheap labour more easily without having to face the difficulties imposed by US immigration laws. Other farmers are lobbying Congress to introduce legislature to free up the movement of immigrants into the United States for seasonal labour. If they succeed, this would result in variable costs falling.
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Hey Trevor,
I was reading your response whilst listening to the podcast. Both you and the reporter mentioned that there were some alternative technologies being developed to allow red-chillies to be picked by machines, but they faced many problems because they were all DIY projects on a small scale. If this is such a big problem, I'm wondering why the US government is not investing money in research and development in order to resolve this issue. The benefits of carrying out this research would far outweigh the costs, because this is an ongoing problem and also agriculture forms an important part of the US economy.
Meiling
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1. What changes have occurred in the American fruit and vegetable industry?
Increased regulation of immigration has decreased the number of immigrants in Southwest America. These immigrants provided labor for many farms. This loss represents an increase in average variable costs, because the labor now available costs more and is less productive.
2. What are the possible outcomes for Southwest farmers?
There are several things that could happen. The first possibility is that the farms will be unable to cope with increased costs, and will be forced to shut down. This will be felt throughout the agriculture industry, and will hurt food production. Another possibility is that farmers will either find another source of labor, or will reduce their need for labor through technology. This would return output to it's previous position.
3. How might technology help save these growers from having to shut down their operations?
The use of machines to harvest rather than people would greatly reduce costs to farms. Machines require less people to operate than manually harvesting crops does. Less labor will be needed, and costs will decrease.
4. What other alternatives do they have to shutting down in the long run?
There are several options Southwest farmers have considered. One possibility is moving farmland to Mexico, the source of the cheap labor the farms depend on. This way, labor would be more readily available and farms could increase output again. Another option is using machines to harvest crops rather than manual labor. Machines require fewer people to operate, and would thus decrease costs.
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Mei,
I think it's interesting how you mentioned farmers' attempts to lobby Congress. Immigration is a very controversial topic, so it's unlikely that their goals of looser regulations will be realized soon. However, if the farms are forced to shut down because of the higher AVC, the effects will be felt throughout America as the supply of vegetables like chili peppers decrease. This could prompt action on Congress's part, but hopefully it won't come to that.
–Mattea
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The American fruit and vegetable industry has changed because the food output has shifted in favor of foods that require less human labor to harvest.
The Southwest farmers could either continue to produce high-labor crops like strawberries, lettuce, broccoli, or chili peppers; plant lower-labor crops such as red chili; move to different locations with more labor; use converted machinery; or try to breed crop hybrids that can be mechanically harvested.
Technology might help to save the operations of these growers through machinery or new plants. Some farmers are converting existing machinery in order to harvest plants that are normally hand-picked. Others are breeding hybrids of plants so that they can be harvested by machine.
Other than shutting down, farmers may move to Mexico, begin to use new machinery, or plant crops that take less labor.
–Chamonix
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Masaya,
Your comment, especially the first part, really made me think. You said that American farmers have switched to mostly using heavy harvest machinery. Of course many crops (such as chili peppers, broccoli, strawberries, and lettuce as noted in the podcast) cannot be harvested by heavy machinery. This means that in order to use the machinery, farmers will either need to grow different plants or breed hybrids that can be mecahnically picked. This makes me wonder about the effect that this change would have on world agriculture. It would reduce the supply of the usually hand-picked crops. This might drive up consumer demand for goods such as corn and other machine-picked fruits and vegetables. This becomes serious when one considers the poor of the world. In many cases, these people rely on staples such as corn. If the demand goes up, then so will the price. This could increase world hunger. Perhaps Congress should begin research into new techonolgies to harvest the delicate crops. Thanks so much for raising these points!
–Chamonix
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1. There has been a loss in labor due to a bigger crackdown on immigration. Since many fruits and vegetables are handpicked and need human labor, a shortage is becoming very possible. This will cause a rise in prices that will affect Americans everywhere. In addition, this labor shortage is forcing farmers who wish to stay afloat to move out of the country, which causes our GDP to go down.
2. The Southwest farmers have been hurt very badly by the shortage of labor. They face having to be shut down because they cannot get enough profit or they will have to change to another crop, such as corn. They can also just move to Mexico, which is labor rich.
3. Technology would solve many of the farmers’ problems. If a machine could pick lettuce and chili, they would not need as much labor and would not be as hurt by the labor shortage. They could actually increase output and at a lower cost.
4. Farmers have other alternatives to shutting down. They could move to Mexico where they can continue to be competitive and have an abundance of labor at a lower cost. They could also switch their crops to one that can be easily harvested by machines. They could even invent a way to use a machine to pick fruits and vegetables that required labor.
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Chamonix,
I like how you said food output has shifted in favor of foods that require less human labor to harvest, but you did not explain why. In order to make up for the increased costs created as a result of less cheap labor, the farmers charge more for their products, which cause us to pay more. The objective is to make money, so if your costs increase, farmers and any other good business owner is likely adjust to make similar profit. Which then chain reacts and causes the consumer to pay more.
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1. In the American fruit and vegetable industry, there has been a recent decrease in the cheap labor force due to stricter immigration laws. This increases costs for farmers to a point where they are experiencing an economic loss, which makes them need to think of alternatives and solutions to their problem.
2. Southwest farmers will either go into an immediate shut down state due to costs increasing higher than revenue (farmers will not be able to sustain firm due to inability to pay fixed costs) or will be forced to innovate with more efficient machinery.
3. Technology might help save these growers from having to shut down their operations because they would increase efficiency of a smaller labor force, thus eliminating the need for increased labor, which would be ideal in this state of lack of cheap labor force.
4. The only other realistic alternative to shutting down or improving machinery is moving the entire operation to Mexico, where cheap labor is abundant. Also, there are no American laws governing the firm if it were to move to Mexico, thus it would alleviate many tough financial situations.
-Dennis-
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Hey Mei,
In regards to your question, the US government probably does not invest money into the research and development of such machines because it is such an insignificant factor in the farming industry that it is not worth it. Think of it this way, would the government rather fund research in the field of food production or research in the field of minimizing labor costs? Clearly minimizing costs of labor is the job of the firm, while finding new methods of growing food is the government's job. Well that is what I think at least. Regarding your actual post, everything you said was excellent and you included economic theory in each response as a proof, which was, again, excellent.
-Dennis-
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1. What changes have occurred in the American fruit and vegetable industry?
Recent tightening of immigration laws has caused a shortage of available cheap labor as it has restricted the movement of Mexican workers. This is important because the harvesting of fruit and vegetables is extremely labor intensive. A shortage of labor means that less can be harvested and the costs of labor have increased. Because of this many farmers have stopped producing the labor-intensive fruits and vegetables, or have moved their farms out of the United States across the border to Mexico.
2. What are the possible outcomes for Southwest farmers?
Southwest farmers may have to stop producing the crops that are the most labor intensive as a way to cut down on labor costs. They may also have to move their farms out of the US so that they can have access to cheap labor. Another possible outcome is that farms that can’t compete at higher labor costs may close which will lower the labor costs for everyone else by a small increment.
3. How might technology help save these growers from having to shut down their operations?
Technology can help to make the harvesting of crops less labor intensive. The production of special harvesting machines or hybrid crops means that the majority of the firm’s costs will change from being variable to fixed. If farms get to make most of their costs fixed, then average total cost over time will be less than before. This is because average fixed costs keep decreasing with an increase in output, whereas average variable costs initially decrease and then start to rise again.
4. What other alternatives do they have to shutting down in the long run?
Farms can move to Mexico where labor is cheaper. This will reduce the variable costs of the farms. The farms can also plant different crops that are less labor intensive. Another possibility, is that the firm can develop technology so that the harvesting of crops is less labor intensive, and therefore make a larger portion of total costs fixed.
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Hey Dennis,
Do you think that the U.S. government will become more lenient on immigration laws surrounding farm labor in an effort to prevent the movement of American farms to Mexico? I see that you commented on Meiling's post by saying that the government wouldn't invest in research into farming innovation, because it's not worth it. However, do you think that the threat of the loss of American farms to foreign soil, thus eliminating any opportunity for American labor in the midst of an unemployment crisis will cause the government to rethink its policies? Is some American labor better than none?
-Issa
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Due to immigration laws, Hundreds of fruit and vegetable farmers are facing higher variable costs as these laws lead to a shortage of cheap labor and the farmers are depending on the labor intensive fruit and veggie industry. The industry changed from a move to Fruits and Veggies that require less Workers and less work, providing more profit on the industry. A good outcome is if there are fewer workers and the farmers changed to a more easy supply of their edibles, profit on them would rise because the shortage of labor and the amount of labor or machinery you have leads to the right amount of care, making more profit from your fruits and no complications. Machines work faster then human labor and can usually be more efficient in getting the dirty work done. The amount of immigrated labor falls and to a point disappear and the industry gets a greater amount of harvests. Besides, you don’t need to pay a Tractor. If all else fails, Farm land can be moved inwards into the Mexican country in order to have the machines and human labor required at a low cost.
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Hi Rocio,
When you expressed a farmer switching to different crops due to outcomes in his industry, how can it be possible if you change the supply but would’nt you still have a small amount of human labor? I Agree to find crops that require less work, and farmers have considered moving their operations to Mexico where the supply of cheap labor is abundant. If no other solutions arise, then the variable costs of the farmer’s would rise to an extent that total cost would exceed total revenue. The loss of human labor and machinery cant hold for a long period of time, so it is likely that a continuation of this situation would see many farms shut down or relocate. This option has actually been taken by some farmers as is noted within the NPR broadcast.
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1. What changes have occurred in the American fruit and vegetable industry?
Fewer laborers are available, because of tightening of immigration laws, which leads to shortage of cheap labor. Some fruits and vegetables can only be harvested by hand, which means that average variable costs will increase. Labor costs are increased but less productive.
2. What are the possible outcomes for Southwest farmers?
Farmers with labor shortage are facing serious changes in their profit. Farms are falling below their normal profit. Many farms will shut down.
3. How might ethnology help save these growers from having to shut down their operations?
Farmers can replace vegetables such as chilies with corn, so they can use machines to harvest vegetables like corn, less human labor will be used and profit will go up.
4. What other alternatives do they have to shutting down in the long run?
Farmers could move their entire farm to Mexico , human labor will increase that way.
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Hi Marisa
I totally agree with you that to make a good profit farmers don’t really need a lot of human labor, may be they can have 50 people for a small farm instead of having 100 although they will have the same amount of work done. I like the point which you made about machines that they are faster and much better at getting the dirty work done. With getting more machines and few workers farm can become better.
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What changes have occurred in the American fruit and vegetable industry?
As American immigration laws have drastically changed, implementing severe regulations for immigrants, and almost eradicating all illegal immigration, there has logically been an immense decrease of cheap labor in the US. As Mexican immigrants were formerly able to illegally cross the border or obtain visa, but still had a great lack of working opportunities, farmers in the US could enjoy from their willingness to do intensive work with low salaries: cheap labor. However, as this changed, farmers in the US are now running out of labor, having their production costs increased enormously, and being forced to seek alternatives, such as the use of machines for cultivation.
What are the possible outcomes for Southwest farmers?
Southwest farmers must change their production strategies, as no more cheap labor is attainable; they will need to substitute this cheap labor somehow, or switch from the goods presently produced to others which require less intensive labor. Anyhow, these farmers will always lose money at first, and depending on their decisions might hence improve or simply shut down production.
How might technology help save these growers from having to shut down their operations?
Technology, such as the transformed tomato-picking machine, could replace the cheap labor, as they need very few workers to maneuver, and could effectively do the work. However, these machines are still having technical problems and breakdown too often.
What other alternatives do they have to shutting down in the long run?
They could improve their technology to make it effective, or move to Mexico, as is stated in the broadcast, or hire illegally workers. However, this would not be very recommendable. Or they could change their production goods to other which would use less labor.
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Hey Margaret,
I like the way in which you link up the decrease in cheap labor, with all the many steps in betwen, to the logical decrease in price again. It is a really good connection which I had not thought of before. However, if farmers already left the industry, due to the high costs of production, what prevents them from shutting down again after they have been attracted back due to the high prices? If the price falls again to the normal equilibrium, they will not earn as much anymore and the costs of production would be again unaffordable. Hence, the same process will happen over and over again. Thus, I believe you forgot to mention important aspects, or simply have some issues with your logical linking.
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1.What changes have occurred in the American fruit and vegetable industry?
The government’s tightening of the immigration laws has restricted the immigration of Mexican workers, therefore causing a shortage in cheap labour. This affects the fruit and vegetable industry because the shortage of cheap workers causes an increase of labour costs and stops or decreases the production of labour-intensive fruits and vegetables.
2.What are the possible outcomes for Southwest farmers?
Many farmers will have to shut down because they cannot deal with the increased costs of production. They can also move to a different location where cheap labour is more available, or they can stick to producing fruit and vegetable which are less labour-intensive.
3.How might technology help save these growers from having to shut down their operations?
Technology would decrease the need for intensive labour, therefore the need for cheap workers keeping the farms from shutting down. It would decrease the production cost and increase the production rate of fruits and vegetables bettering the fruit and vegetable industry.
4.What other alternatives do they have to shutting down in the long run?
The alternative could be moving to Mexico where cheap labour is plentiful and there would be no problem with the immigration laws. The farms could also switch to less labour-intensive fruits and vegetables so that they don’t have to spend as much money on the workers.
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Hey Trevor,
I'm also taking economics HL but i'm in section B. I really like your idea about the illegal workers, no one else seemed to think of that. Your example about the chilli is really good aswell, and yeah it will save the chili farms, but what about the rest of the fruit and vegetables? The population of the United States can't live on chilli for the rest of their lives. It would be good to find a way to reduce the labour for all of the fruits and vegetables possible. I really liked your answers, they were different from everybody else's and interesting to read.
Sara
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3. How might technology help save these growers from having to shut down their operations?
4.
1) What changes have occurred in the American fruit and vegetable industry?
The American government's tougher laws on immigration have restricted the availability of cheap, illegal workers to farmers. This is a considerable problem for American fruit and vegetable growers, since fruits and vegetables(especially lettuce, strawberries and broccoli) are labour intensive and the farmers depend for a great part on these illegal workforces. Farmers are forced to take up legal labourers and this will raise variable costs significantly. With the average variable cost curve nearing and maybe even crossing the price line – meaning the loss is bigger than the fixed cost – a lot of fruit and vegetable farmers, especially lettuce, strawberry and broccoli farmers, will have to switch to less labour intensive crops. Supply of lettuce, strawberry and brocolli will decrease and prices of these crops will rise. The higher price will encourage farmers to start cultivating these crops again.
2) What are the possible outcomes for Southwest farmers?
They will have to look at ways of reducing variable costs – otherwise they will suffer a loss bigger than the fixed cost and will have to shut down.
3) How might technology help save these growers from having to shut down their operations?
Introducing technology requires a lot of investment, and while not all farmers can afford this, the farmers who can will benefit from doing so since it reduces the labourers needed and will reduce variable costs. Technology will probably also increase the rate of productivity.
4) What other alternatives do they have to shutting down in the long run?
Moving their farms to places where cheap labour is available is one alternative, and another is cultivating other, less labour intensive crops as well so they are not entirely dependant of the labour intensive crops.
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Marcelo,
Your response is very good, it sums up pretty much everything and when talking about alternatives farmers have to shutting down, you discuss the weaknesses of these alternatives as well as how they would benefit the farmer. I liked your explanation of the effect the tightened immigration laws have on the availability of labour, it was interesting to read.
-Eline
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What changes have occurred in the American fruit and vegetable industry? Some changes in the American fruit and vegetable industry are farmers are not making as much money as they one were. This is because there have been negative changes on imports and exports for goods coming in and out of the country.
What are the possible outcomes for Southwest farmers? Farmers are going to have to start reducing costs quickly so that their businesses can stay afloat. If they do not than they will lose their jobs.
How might technology help save these growers from having to shut down their operations? Technology could play a huge part in saving farmers from peril. Technology makes things happen in less time than manual labour and in the long run will help produce more product which balances out prices.
What other alternatives do they have to shutting down in the long run? If the farmer produced something that didn't take so much care and was easy to grow than this would help farmers stay afloat. Another alternative would be moving to an area where a certain crop was needed.
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Masaya,
I like your point on replacing the mexican work force with a machine that does their job more efficiently in less time. Also you have a good point about moving the firm to Mexico because it will be true that labour would cost even less there.
- Kurtis
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• What changes have occurred in the American fruit and vegetable industry?
The American government restricted the work of Mexican immigrants, causing a decrease in cheap labor. This law affects the fruit and vegetable industry because the cheap labor shortage causes an increase in labor costs; they cannot enjoy anymore of intense work at lower salaries. Consequently this can cause a decreased production of good fruit and vegetables. This situation might cause the shut down of the production.
• What are the possible outcomes for Southwest farmers?
Some farmers will have to change their strategies of production or just shut down. If they decide to look for strategies they will need to substitute in any way the cheap labour, or maybe move the location of their cultivation.
• How might technology help save these growers from having to shut down their operations?
Some farmers might bring in technology instead of workers, however technology needs investment and some farmers might not be able to afford for a technological farm.
• What other alternatives do they have to shutting down in the long run?
They could think on producing less labour intense crops, to afford machinery to farms or to move their plantations to cheaper locations.
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Sara,
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Sara,
I like your point of moving the farms to mexico or to any other place were the workforce is cheaper. your ideas are very similar to mine.
karen
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There has been a lack of labor. Harvests that can be collected by machine such as corn are replacing chili as that can only be picked by hand. There is not enough legal farm workers to pick all the red and green chili. There has a new modified tomato machine to pick the red chili but it is far from perfect and it could not be used for green chili as that would be to fragile. Legal farm workers are usually in their 50’s or 60’s and always get older this is because younger workers would either not get a working visa or do not want to do this kind of work. The Farmers are thinking about moving their chili plantations to Mexico where there are more legal farm workers and the vegetable can be harvest in greater amount. In future there can be machines developed that will be able to harvest red and green chili. To not shut down in the long run the farmers could plant other vegetables or move their plantation to Mexico where labor and growing will be cheaper.
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Eline,
I think you answered and explained the first question very well. In answer 3 It is true that only some farmers will be able to afford machines and unfortunately the smaller farmers will go down or have to change crops. This might be good in one point that with the farmers that can afford machines the productivity will increase and everything will go faster. But this will also conclude to fewer jobs not only the farm workers on those farms (the ones that can afford machines). But also all the smaller farms will loose their existence and might fall into poverty
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- What changes have occurred in the American fruit and vegetable industry?
With the implementation of new, stricter immigration policies by the United States, fruit and vegetable growers in America can no longer rely on cheap labor, especially from Mexico. The industry now calls for fruits and vegetables that require less labor to harvest, and no longer favors the hand-picked varieties. (The industry wants to minimize production costs.)
- What are the possible outcomes for Southwest farmers?
At this point, Southwest farmers can continue their growing with higher labor costs (and lose revenue), convert machinery to make labor faster, or even move the farming to Mexico in pursuit of cheap labor.
- How might technology help save these growers from having to shut down their operations?
Developments in technology can make labor faster and more efficient. For example, look to the converted tomato picking machine that requires 2 to 3 people to operate it. This technology does not require vast manpower, and will save growers money in the long run.
- What other alternatives do they have to shutting down in the long run?
One of the alternatives is moving the business to Mexico, where the strict immigration laws will not apply. Another solution would be to switch over to different types of machinery that work faster and more efficiently.
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Hi Victoria,
You point out that technology like the modified tomato picking machine is not helpful to the green chili industry. Do you think that there are other technologies out there that could be helpful in terms of efficiency and manpower? I think another interesting thing that you mention is the average age of the workers, as well as the unwillingness of younger people to work in agriculture. I wonder if that will ever change as the demand for laborers continues to increase.
- Catherine
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1.What changes have occurred in the American fruit and vegetable industry?
The changes that have occurred is the new enforcement from the American government of stricter immigration control especially from Mexico leading to a decrease in cheap labour for the farmers to use for such labour intensive industries. they now need to change to a more technological ways in order to reduce there workforce and their product costs.
Also we see an increase in fruit and vegetable that is easier and less labour intensive fruits and vegetables coming to the market and being more favourable to harvest.
2.What are the possible outcomes for Southwest farmers?
The option open to the farms now are to reduce there workforce and work at a reduce rate will will effect there output and turnover. They could look to change crops so they are able to harvest the crops with machinery and look to exploit economies of scale through the use of new advance technological machines. They could change their geographical location to Mexico so that the cheap labour is freely and readily available and they will be unaffected by the tightening effects of stricter immigration.
3.How might technology help save these growers from having to shut down their operations?
Technology can play a big part in helping farmers from having to shut down as they reduce the workforce considerably reducing costs and they also increase output which means a greater turnover is possible. If there are machines to pick there crops then they would be able to reduce there production cost.
4.What other alternatives do they have to shutting down in the long run?
Another long term alternative other than technological use would be moving the business to Mexico where the labour would be there and also very cheap and the effect of stricter immigration would have gone. They could use more efficient machinery as well although costs lots of capital it will in the long run reap better reward as they will reduce costs and increase output.
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Victoria
The idea of growing different crops is good but they may not bring in shuch good profit and also there may be more competion in these crops as there easy to produce and so the prices would be lower as there are many substitutes. The sam problem can be found in moving to mexico because there may not be a thriving market for vegatbles and fruit unlike the usa and they may not be able to sell in the usa because they are in mexico. The point about the average is good and the idea that they are getting older and will be a slower workforce so he needs alternatives is a good idea.
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Southwestern Farmers Perfect Competition
1. What changes have occurred in the American fruit and vegetable industry?
There has been an increased amount of immigrants in Southwest America due to a stricter regulation of immigrants. Many of these immigrants, mainly Mexico, provide cheap labor for many farms. Farmers now have to which to more expensive labor increasing their average variable cost.
2. What are the possible outcomes for Southwest farmers?
The farmers have several options they can do. First, the farmers could decide to harvest half of the crop to keep the average variable cost low, because only more expensive labor is present. This way the farmer will experience a smaller loss. Another option for the farmer would be to find another source of cheap labor, machines. In the podcast it said that there was a machine available that destroyed some of the crop in the process but in the long-run, the damage will not be as terrible as the loss of the farmer. With machines a lot of average variable costs could be decreased because only two or three workers are needed to operate the machine. To the point where it become extreme, the farmer may decide to shut down, this must only happen if the loss of the farmers is greater than the average fixed price. This will affect the entire food industry slightly. The price would increase because of shift in the supply curve to the left. Then the farmer should reenter the food industry with a high selling price than before, this way he will be able to pay for his cost and earn normal profits.
3. How might technology help save these growers from having to shut down their operations?
With the use of machines the farmer could greatly reduce his average total costs. A machine only needs two or three people to operate it thus the average variable cost of labor is greatly smaller than the previous hand picking labor. The farmer could possible also harvest at a faster rate, so even more decreasing the average variable cost of labor. If the farmer’s harvest is constant but the average total cost decreases the farmer will receive more profit, possibly even abnormal profits.
4. What other alternatives do they have to shutting down in the long run?
There are several options instead of shutting down. Like it said in the podcast, farmers could start a plantation in Mexico; the labor would be more plentiful and readily available. Furthermore, the farmer could use the cheap labor and have lower average total costs. Another alternative to shutting down would be to harvest crops with a machine instead of handpicking labor. A machine only requires two or three workers to operate instead of 250 workers harvesting an entire field. This decreases the average variable cost of labor. Lastly, a farmer could also decide to harvest a portion of his crop instead of everything, his average variable costs would decrease because he doesn’t need as much labor there for the loss is smaller than harvesting the entire field at a more expensive average variable cost.
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1. There are fewer workforces, as the number of people coming form other countries, such as Mexico, are being reduced. As a result, the American farmers now have to switch to a more expensive workforce.
2. The chili can't be picked by machines, and it must be picked by hand, otherwise the crops will be damaged. However, it is a possible outcome if the farmers consider the long-run, as the loss due to damaged crops will be less than paying for more expensive workforce.
3. The total costs for buying and operating a machine is less than paying for all the workers to harvest the crops by hand. However, it is only in the long-run that this will be an economical way to do, because the cost for buying a machine will definitely increase the total fixed costs. however in the long-run, the average fixed costs will be lower and lower, but if farmers pay for the workers, it would cost a lot more.
4. Farmers have more options than shutting down. Firstly is to move the entire plant to
Mexico, where they have cheap labor. Secondly, they can decrease the size of the plant, say a half of what they have now, because it would cost less to run a plant half a size. However, along with that, they have to find some technology to increase the efficiency of plant.
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1) The changes that have occurred in the American fruit and vegetable industry are due to a shortage of labor. Some fruits and vegetables can only be handpicked, because they are too delicate to be picked by machine, and a shortage of labor causes great inefficiency. For this reason, farmers have had to switch to growing different fruit and vegetables in order to be more productive.
2) The Southwest farmers were growing chili peppers, but because machines are incapable of harvesting them, the farmers who do not have enough labor force will suffer from serious decreases to their profit. It is possible that these farmers will fall below the normal profit and therefore will be forced to shut down due to increasing costs.
3) Technology might help save these growers from having to shut down their operations because if new machines were invented that were capable of harvesting the fruits and vegetables that they were growing before they switched, they would not have had to switch in the first place. The machines would allow the farmers to be very efficient and therefore very productive. Either they would then produce at a point that will give them normal profits, or, if their average total cost is below their average revenue, they would be receiving abnormal profits.
4) In the long run, the farmers could start a plantation somewhere else, such as in Mexico, which they suggest in the podcast, where there is more labor available. The labor in Mexico would be cheaper, meaning that the farmers’ average costs would be lower, so their profit might increase. Another alternative for farmers would be to invest in machines, because they are far more efficient than labor. Another way for the farmer to prevent having to shut down would be to only keep a portion of their land, which would decrease their costs since it is cheaper to run a smaller plant than a large one. However, if the plant is smaller, it means the farmer is able to harvest fewer crops, which would lead to less output. To compensate for that, there would have to be an improvement in technology that would allow the farmer to be more efficient, in order to prevent him from having losses.
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1. What changes have occurred in the American fruit and vegetable industry?
Certain fruits and vegetable need require labour intensive work. Most of this labour comes form Mexico accross the border. Farmers are now resorting to capital intensive ways to harvest their goods. Eventhough some goods are very hard to harvest using machinery, so farmers resort to producing other fruits or vegetables, which can be picked by using machinery.
Due to the new immigration laws, Farmers have found it less hard to employ workers, which is mostly because the new immigration laws are making it alot harder for illegal immigrants to come and work over in the US. These new illegal immigrants tend to be young immigrants searching for a new life. These are the ones farmers want to replace the old workers that are allowed into the country.
2. What are the possible outcomes for Southwest farmers?
Farmers have the option of resorting to producing fruits and vegetables that require machinery, however the cost of this is very expensive on the short term, long term this would be very advantageous.
Another would be changing location as mentioned in the podcast, and moving the company to Mexico where cheap labour is widely available. However there is also a cost tied to this.
The worst outcome possible is for Farmers to close down their business
3. How might technology help save these growers from having to shut down their operations?
Technology will help farms be more efficient in working, however they will have to produce fruits and vegetables which can be easily harvested by the technology that is provided.
The cost however is large, and I don't necessarily think that this will avoid farmers from having to shut down their farms, due to the simple reason that capital intensive equipment costs alot of money. Which some farmers just don't have.
4. What other alternatives do they have to shutting down in the long run?
Investing money in capital equipment
Joining forces with other farmers
Move business location
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1. What changes have occurred in the American fruit and vegetable industry?
In the American fruit and vegetable industry, the cost of labor has increased due to the shortage of cheaper labor by illegal workers. Nowadays, there are tougher immigration laws and hence the acquisition of cheap labor is difficult. This means that the industriy's average variable costs (like labor) are increased. This results in more costs when wanting to produce output.
2.What are the possible outcomes for Southwest farmers?
Some of Southwest farmers were thinking of going down to Mexico. The farmers think that they might be more efficient and competitive in Mexico because they might be able to have many workers, while paying low wages.
3.How might technology help save these growers from having to shut down their operations?
The famers were thinking of using technology in order to be more efficient. However, many fruits and vegetables can only be harvested by hand. Such fruits and vegetables are strawberries and broccoli.
4.What other alternatives do they have to shutting down in the long run?
In the long-run, the famers can increase all of their resources, including labor. This is because the long-run period is also known as the variable-plant period, where all resources become variable and usable. This means, that famers might find a way to better harvest fruits and vegetables through machines and technology, thus increasing their capital.
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What changes have occurred in the American fruit and vegetable industry?
“Hundreds of fruit and vegetable farmers are facing higher variable costs as tougher border security and immigration laws has led to a shortage of cheap labor, which the farmers depend on in the labor-intensive fruit and vegetable industry.”
What are the possible outcomes for Southwest farmers?
The Southwest farmers with a shortage of labor will face a decrease in supply of the fruit and vegetables. They could either, a) not be able to tend to the already existing supply amount, and some will waste away, or b) be forced to plant less because they have less people to tend to the crops and plant/harvest them. Technology may help with the labour needs of the farm, however, if they still experience a greater financial loss than the fixed costs of equipment, etc., they will be terminated.
How might technology help save these growers from having to shut down their operations?
If they can find technology to bring down costs, that could help overall by eliminating the farmer’s need for the limited availability of manual labor. Once the technology is paid for, there are minimal costs rather than a continuous salary, no matter how cheap the previous labor was.
What other alternatives do they have to shutting down in the long run?
Expanding of resources is a good method to keep from shutting down. Cheap labor results in lower average total costs, which could also be achieved by only needing a few workers with the technology, which decreases the average variable costs. Another option outside of the labour factor would be to slow down the production as much as possible in an attempt to spike demand. Prices will rise at the higher demand, and then they will have more money to make up for their losses and gradually return the supply to equilibrium.
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Hello!
It's a very good point to mention that not all farmers can afford to invest in technology; and doing so may even contribute to their rapid decline. Technology helps in the long run, but it's important that a farm withstands the adaptation of new processes while they may be financially instable.
Thanks!
-Katie
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I think slowing production to stimulate the demand is definitely a good option however it is contingent on the fact that these farms have enough financial backings to ride out the first year when they are not making as much profit. Farmers need to be ready to waited out for the long haul. Equilibrium cannot be achieved in a short time period.
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17-2 the economic Blogsphere
Some Changes have turned up on certain farms in Arizona due to the lack of workers. They have now started having to use machines where possible as because of the American government tightening up immigration laws then they just can’t get the cheap labour anymore. This has ended in farmers changing what they grow to crops that can be harvested by machines such as corn. And one farmer has started growing a pepper crossed with a cyan pepper. This makes the stalk easier to come off and so makes it possible to be picked using a machine.
Some farmers have even started to consider moving his farm to Mexico as he could get the labour without the labourers having to cross the border. By this it means they can get the same prices for the peppers they are growing. Although, technology is saving the farmers as with machines they can harvest the peppers cheaper and indefinite as they don’t need people to work if there is a machine picking the peppers. They have the option to move or change their methods of farming but not really any other choices unless they shut down.
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What have changed in the American fruit and vegetable industry is what they are producing.
Most of the fruit and vegetables that is produce required intensive labour work and can only be picked by hand. But they are only a few workers doing the job, therefore the farmers had to change what fruit or vegetables they are producing in order to produce more.
Southwest will have to change their methods such as reducing their production of pepper and produce something next to it that don’t need to be hand- picked. Therefore the farmers will need a smaller machine for the other types of fruit and vegetables and less people will be required for the peppers. Another solutions would be moving to Mexico but it will mean serious competition. But depending on the decision they will take they will certainly loose some money in the first place.
2700 people are required to picked pepper. If the farmers decide to substitute them for machines and change what he is producing. It can mean that they will avoid shutting down their farms.
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1.What changes have occurred in the American fruit and vegetable industry? Unlike corn that can be planted and harvested through the use of machines, fruit and vegetables need intensive labour work (for example, strawberries need to be hand picked). However, toughened immigrational laws have rendered the fruit and vegetable industry with very few workers; labour is much more expensive now, to the point where farmers are considering moving their farms to Mexico.
2.What are the possible outcomes for Southwest farmers?
Lack of intensive labour workers will create a decrease in the supply of fruit and vegetables; the fields are quiet because there aren‘t enough workers, therefore farmers are considering moving their operation to Mexico.
3.How might technology help save these growers from having to shut down their operations?
If technology could become so advanced to the extent where the fruits and vegetables wouldn‘t need to be handpicked then the growers would once again thrive, especially since they wouldn‘t have to pay the machinery wages.
4.What other alternatives do they have to shutting down in the long run?
They could move closer to the borders/or to mexico where labour is cheaper, or they could encourage immigrants somehow to come work for them by providing them with visas? Or they could invest money into machinery or switch to other crops.
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Hi Rocioperez, I wonder how they would go about investing in more and better machinery as to decrease their dependency on labour, when their crops are crops that need to be hand picked, therefore such advances in technology haven't been found yet. I definitely agree with your last comment, moving to Mexico could be a very economical option for the farmers as a response to the strict immigration laws. I worry about your answer to number two, because if all farmers were to think in that direction there would be a huge fall in the production of hand picked fruits and vegetables such as broccoli and strawberries.
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1.What changes have occurred in the American fruit and vegetable industry?
Variable costs for farmers increase because of the stricter border security and immigration laws. There is a shortage of cheap labor in the industry.
2.What are the possible outcomes for Southwest farmers?
It is hard to employ cheap labor if the growers choose to stick to growing the same crops that require intensive labor; the labor costs will increase by a large amount and profits might decrease or even causing the growers to make a loss. This may force them to shut down the operations. Also causing the workers to be unemployed.
3.How might technology help save these growers from having to shut down their operations?
The growers can switch to growing alternative crops that can be picked by machines. Hence they don’t need to shut down their operations.
4.What other alternatives do they have to shutting down in the long run?
They can petition to the congress to make a law for losing the tights on border and immigration.
Farmers can change their crops, to the crops which require less labor and more machines.
They can also stick to growing the same crops but earning less profit.
They may also switch to other industries or be urbanized and work in the cities.
Operate farming in another country where the farmers can employ cheaper labor.
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I agree with you that the industry can be entirely moved down to Mexico. But it is not as realistic as improving machinery and shutting down. This is because a lot of people are reluctant to move away from the place they've been living for their entire lives.
And the machinery is only realistic when the crops can be picked by machines and do not require hard labor to pick.
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1)There is a lack of labour resources, it is mentioned that lettuce, strawberries and in this case chilli peppers all need to be hand-picked, and cannot be harvested using machinery. The lack of labour forced some farmers to depend on illegal workers, but with this being against the law on immigration, variable costs for farmers is being
significantly raised and as a result, some farmers would rather move their farms to Mexico, where labour is available.
2)They might have to shut down their farms because the variable costs are too high and it is resulting in productive inefficiency.
3)If the farmers can afford to invest in technology, it will not only increase their productive and allocative efficiency, but also eventually decrease their variable costs. It would also eliminate the farmer’s need for a larger workforce.
4)The farmers could move their farms to a place where cheap labour is available, or maybe choose to switch to different crops.
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Overall, I agree with your points, but I liked the fact that you mentioned the relationship with normal profits, because if this continues to happen, and the farmers are unable to make profits, if the horizontal line drops below the AVC curve, farmers will have to shut down their firms. .
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1. What changes have occurred in the American fruit and vegetable industry?
After the US government passed legislation that tightened the immigration laws, there has been a shortage of cheap labor available for farmers to use when harvesting fruits/vegetables. This increased the costs of production for the farmers; as they could no longer employ Mexican immigrants.
2. What are the possible outcomes for Southwest farmers?
Many farms depend on cheap labor to survive; as many fruits and vegetables (such as green peppers) cannot be harvested with machines. These farms will either have to change their product to one that can be farmed with machines, or move their farms to Mexico where cheap labor is more abundant. If not, they may face having to shut down their operations.
3. How might technology help save these growers from having to shut down their operations?
Advanced technology in the making of machines, or in the planting of the produce (e.g. creating 'hybrid' peppers), may save the farmers from having to shut down their operations. If they can effectively substitute human labor with a machine, the harvest can be harvested without the need for cheap labor. It will decrease the cost of production; and the farm can remain in business.
4. What other alternatives do they have to shutting down in the long run?
As was mentioned above, another option available to the farmers who are unwilling or unable to employ more advanced technology in their methods for harvesting their product is for them to move their farms to Mexico; where cheap labor is more abundant. This too, would decrease the costs of production, and would allow the farmers to remain in business.
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Hey lzhang2,
Your response was very interesting. You included many more 'alternatives' for the last question than I did. I included only the major points of moving the farm to Mexico, or using advanced technology, but the many points you illustrate in your response were also mentioned in the podcast and are just as relevant for the farmers who are attempting to avoid shutting down their operations. Additionally, I found it interesting how you included the unemployment of the workers as an outcome for the second question. I focused primarily on the farmers' outcomes, but the perspectives of the workers are also important and the unemployment can also have grave repercussions on the economy.
Lucas G
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1.What changes have occurred in the American fruit and vegetable industry?
•Many of fruits ad vegetables required being hand picked and considering the more strict regulations on immigrants, there is a shortage of immigrant labor.
2.What are the possible outcomes for Southwest farmers?
•They could produce vegetables and fruits that can be harvest by machines or possible re locate to Mexico where there would be an increase in available workers.
3.How might technology help save these growers from having to shut down their operations?
•Some farmers have altered harvesting machines to be effective for multiple types of vegetables and fruits. Could replace workers with machines, which will need fewer workers.
4.What other alternatives do they have to shutting down in the long run?
•Create hybrid fruits and vegetables, which can be harvested by machines.
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1. What changes have occurred in the American fruit and vegetable industry?
In America, immigration laws have been tightened, which has decreased the availability of cheap labour from neighbouring countries such as Mexico. This means that for the fruit and vegetable industry, which relies highly on this cheap labour to harvest its products, the variable costs of producing their fruit and vegetables have increased because they have to pay more for labour, therefore harming their industry.
2. What are the possible outcomes for Southwest farmers?
One of the possible outcomes for Southwest farmers is that they will no longer be able to run their firms due to the increased costs, and they will be forced to shut down. Another outcome is they switch to crops that can be harvested by machine, so as to reduce labour costs, or they use a new machine that can harvest their original crops. Somehow, the industry will have to change to adapt to the problem.
3. How might technology help save these growers from having to shut down their operations?
Machines may be invented that are able to harvest the valuable fruits and vegetables. This will mean that farmers will no longer have to hire people to harvest their products for them, and so they will not be as negatively affected by the labour shortage. Machines are also more efficient than humans, and so can harvest more in a shorter period of time, leading to increased efficiency for the farmer.
4. What other alternatives do they have to shutting down in the long run?
Farmers could embrace the new technology and use machines to pick their crops, so they are not affected by the labour shortage. Another option, that was discussed in the podcast, was moving the farm to Mexico, where the farmers could take advantage of the cheap labour they had before. Or, they could attempt to convince the government to change the immigration laws, so that the farms will stay in America and boost the economy there, rather than moving to Mexico.
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Hi Lucas G,
Great point about the hybrid peppers – it will definitely take a considerable amount of technological innovation to create a plant that has the same characteristics as a green pepper, but the ability to be picked like a machine like some other produce. One thing I was considering – do you think that the cost to make these technological innovations will be paid for by the revenue generated from the production of these fruit/vegetables? Or will the technology that needs to be developed to save the farms actually be so expensive, it ends up causing the farms to shut down anyway? Great points!
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1.What changes have occurred in the American fruit and vegetable industry?
As the US government has put more strict boarder control between the US and Mexico, less workers are able to work on farms that product fruits and vegetables. In the podcast, one farmer is considering moving to Mexico in order to employ more labor workers without them having to commute to Mexico and the US everyday.
2.What are the possible outcomes for Southwest farmers?
As seen in the graph, the result of this may being having to shut down all operations. This is because some products, such as chilies, can not be harvested with technology (yet) and need human labor in order to be successful.
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3.How might technology help save these growers from having to shut down their operations?
In some cases, technology powered by 2-3 people can harvest the fruits and vegetables. There are many functional problems right now but soon enough, these technologies will be used to run farms.
4.What other alternatives do they have to shutting down in the long run?
The alternative to shitting down in the long run would be moving to Mexico in order to have humans working on their farms. This would be more profitable as they would be able to produce large quantities of fruits and vegetables because of the amount of people. Also, the workers would be able to work longer hours because they would be living closer to the farms. There would also be less legal concerns because they wouldn't have to be crossing the boarder every day to get to their work place.
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Hello Lucas G,
I throughly enjoyed reading your response and I felt I had similar thoughts to yours. The alternative of moving to Mexico would be a great economical advantage. I am not farmiliar with the prices of land in Mexico but I should hope that it wouldn't be costly to purchase a large area of land to farm on. The weather might play a factor in why the American farmers aren't choosing to move their yet. This might be a good thing for one to research before making the decision to move away!
Thanks!
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1.What changes have occurred in the American fruit and vegetable industry?
In the US, immigration laws have become stricter and therefore they have stopped cheap labor –
Now that the immigration laws have tightened, there are less Mexican people who were likely to fulfill these cheap labor jobs by handpicking the fruit and vegetable – the Mexican people were the major labor force of the industry. It has now moved from handpicking labor to heavy machinery harvest due to the fact that the farmers are experiencing shortage of cheap labor.
2. What are the possible outcomes for Southwest farmers?
The Southwest farmers may have to adapt to the situation they are in; therefore they have to either change product – something that can be harvested by machines or find a way that the machine can harvest their fruit and vegetable crop. If this does not work they will have to shut down their firm.
3.How might technology help save these growers from having to shut down their operations?
Due to new technology and increasing amounts of new heavy machinery, in the next few years it might be possible to use machinery to pick fruit and vegetables and save these farmers from having to shut down their operations. This will allow the farmer from not having to use cheap labor, this may cost a lot in the short run to pay for the machinery however in the long run he will have saved as he had to only pay for the machinery once. The farmers could now remain in business.
4.What other alternatives do they have to shutting down in the long run?
There are many possible outcomes; first of all they could use the technology invented to ignore the cheap labor and harvest their same vegetable crops and fruit crops. They could change product and choose something that can be harvested by machinery if no new technology is made. Finally, they could move their operation to Mexico where the cheap labor is allowed, where they can maximize their profit as they were before the new laws.
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Hey monique, I totally agree with your points and arguments. You have correctly responded to all of the questions and all of your possible outcomes seem possible. It is interesting to try and imagine the outcome of things we do not own. I really liked the last idea you had in the 4th question about convincing the government to change the immigration laws, however do you really think it would be easy? I mean its a good idea, but i really think it would take a lot of time and effort and time is something the farmers do not have, if they do not produce they do not make money. Good post !
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1.What changes have occurred in the American fruit and vegetable industry?
In the US the immigration laws were tightened, became a lot stricter and therefore starting limiting the availability of the cheap labour that came to America from its neighbouring countries, especially Mexico. Cheap labour is an essential part for the fruit and vegetable farm business. Therefore these tightened immigration laws caused farmers to have to increase their costs, because they had to now hire more expensive, local labour. With no increase in the output, this increased costs harmed their production.
2. What are the possible outcomes for Southwest farmers?
First of all the prices of their products will have to rise to support the increase in costs, this will lower demands for the farmers, so to adapt to the new situation they may have to change their products, to products that can be harvested by machinery. If that will not be effective, unfortunately they will be forced to shut down.
3. How might technology help save these growers from having to shut down their operations?
Technology can in theory replace human labor, and therefore eliminate their problems with the shortage of cheap labor. Machinery is not cheap however, it is very efficient, much more productive than human labor therefore the increase efficiency can eliminate the slight increase in costs. Eventually new technology can be invented that will allow the farmers to harvest certain crops that can only be harvested by humans, to be harvested by machine. This would completely get rid of the cheap labor problem they are facing.
4.What other alternatives do they have to shutting down in the long run?
The farms could move their production to Mexico, where they could employ the cheap labour and not face any immigration problems. Or all the farmers could come together and strike to the government to lower the immigration laws and allow more labour into the country.
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Hi spoulos2, I really liked your post. You answered and explained in questions very clearly and shown good understating of the blog post. I agree with all your answers, and I especially like your answer to question 4, where you gave a list of numerous possible alternatives that are all imaginable.
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1. What changes have occurred in the American fruit and vegetable industry?
Immigration laws have tightened in America, which has a resulted in a decrease of immigrants, the principal resource for fruit and vegetable collection, and therefore an increase in their production costs.
2. What are the possible outcomes for southwestern farmers?
If the production costs rise to high, the firms may be forced to shut down. An alternative outcome may be that the firms would switch from workers to machinery for the collection of the crops they produce, or to switch to other crops that can be produced with current technology.
3. How might technology help save these growers from having to shut down their operations?
Crop collection technology might enable the firms to continue production as they could change from the costly workers to machinery, given that the machines are more cost efficient.
4. What other alternatives do they have to shutting down in the long run?
In order to prevent shut down, they could switch to alternative sources of produce collection, act against the labor shortage by convincing the government to increase immigration, or moving to the main source of immigrant labor, Mexico.
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Hey, I agreed with all your answer and they clearly explained very well. All your answers have shown your understanding of the materials within the blog post very well. Overall, great job(:
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Hi spoilous2!
Your explanations are very well done and I agree with most of it. I also really liked the possible alternatives that you provided in question #4. However for question #3, I think it doesn't take a few years for farmers to use machinery to pick fruit because they could either purchase one right away or alter existing machines that they have. Anyhow, your concept and idea is correct that that's good!
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Discussion Questions:
1.What changes have occurred in the American fruit and vegetable industry?
In America, around the borders, many workers who work for minimum wages are illegal workers that came/come from Mexico. Now, since the immigration law is getting stricter, the American fruit and vegetable industry is having a shortage of workers. The lack of cheap labor has negatively impacted the farmers.
2.What are the possible outcomes for Southwest farmers?
If they would like to stay in America, the Southwest farmers can either grow fruit that can be picked by machines or they can create or experiment with new machineries. And if not, then an alternative is to leave the united states and go to somewhere cheaper, such as its neighboring country, Mexico.
3.How might technology help save these growers from having to shut down their operations?
Technology will enable the farmers to move away from having to use a lot of labor. Thus, they won’t experience the shortage of cheap labor and will not have to move away.
4.What other alternatives do they have to shutting down in the long run?
Just as I mentioned in the top, an alternative is that southwest farmers can move their farm to Mexico.
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1.What changes have occurred in the American fruit and vegetable industry?
In the American fruit and vegetable industry, the cost of labor has increased due to the shortage of cheaper labor by illegal workers. Nowadays, there are tougher immigration laws, making acquisition of cheap labor more difficult. This means that the industry’s average variable costs (like labor) are increased. This results in more costs when wanting to produce output.
2.What are the possible outcomes for Southwest farmers?
At this point, Southwest farmers can continue their growing with higher labor costs (and lose revenue), convert machinery to make labor faster, or even move the farming to Mexico in pursuit of cheap labor.
3.How might technology help save these growers from having to shut down their operations?
Developments in technology can make labor faster and more efficient. For example, look to the converted tomato picking machine that requires 2 to 3 people to operate it. This technology does not require vast manpower, and will save growers money in the long run.
4.What other alternatives do they have to shutting down in the long run?
The only other realistic alternative to shutting down or improving machinery is moving the entire operation to Mexico, where cheap labor is abundant.
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Hi Jacob! I agree with all your answers. moving to Mexico does seem like the best answer, however many farmers will find it hard to do, meaning they have to quit their hometown, and start a completely new life! If they are not ready to make this lifechanging decision, then they might well have to invent some new technology to replace the labor!
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hey
Although with the machines being used people are still needed to operate them and fix them if they break down.
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1. What changes have occurred in the American fruit and vegetable industry?
The lack of labor force d change in the vegetable and fruit industry
In America. For example, the green chili that was often seen in the farms are now replaced with corn because corns can be harvested by machines. Furthermore, due to the tougher immigration laws, it is making it harder for illegal immigrants to cross the border. As a result, cheap labour is not as readily available as before.
2. What are the possible outcomes for Southwest farmers?
Due to a lack of labor force, a decrease in the supply of fruit and vegetables might result. Furthermore, less labourers might also mean that the preexisting supply might be wasted away because there isn't enough people to tend to these vegetables. This situation might also mean that labourours might have to plant less variety of crops and fruit because of possible wastage.
3.How might technology help save these growers from having to shut down their operations?
Advanced technology might help save growers from having to shut down their operations since many of these machines only need the assistance of only a few labourers to run. Thus, this substitute might help reduce the variable cost. However, as of this moment, the machines that they are using are of poor quality and are unreliable. Thus, by investing in superior machines, they might be able to substitute labourers with machines.
3. What other alternatives do they have to shutting down in the long run?
One alternatives to shutting down the farms is to move the farming the operation across the border to Mexico where cheaper labors are readily available. Another alternative is to pass legislation that permits more foreign labors to move in.
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1. What changes have occurred in the American fruit and vegetable industry?
There are far fewer laborers available due to the tightening of immigration laws, which leads to shortage of cheap labor. Many fruits and vegetables require hand picking, which means that average variable costs will increase. Labor costs are increased and are less productive.
2.What are the possible outcomes for Southwest farmers?
Farmers with labor shortages are facing large decreases in their profit. Farms are beginning to shut down due to this drop in income.
3.How might ethnology help save these growers from having to shut down their operations?
Farmers can replace the crops they are growing with other crops, so they can use machines to harvest them. This causes less use of human labor and will cause an increase in profit.
4.What other alternatives do they have to shutting down in the long run?
Farmers could purchase land in another countries without labor shortages.
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Hey Jackson,
I agree with most of the things you mentioned – and your explanation of the effect on labour costs made it clear for me! What did you make of the hybrid idea? I thought it could be innovation, but that which is only possible with technology – what do you think ?
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1.What changes have occurred in the American fruit and vegetable industry?
Since the American laws on immigration have been changed, have the farmers less opportunity to get cheap labour from other countries. Therefore they have to use more expensive labour which increases their costs.
2.What are the possible outcomes for Southwest farmers?
There is a big chance that many of the Southwest farmers will have to shut their farm down since the costs have increased a lot. Another option is the increase of use of machines, to make the labour a bit cheaper.
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3.How might technology help save these growers from having to shut down their operations?
Since technology nowadays is a lot cheaper than a few decades ago, it is cheaper to buy a machine once than hire many employees. This will be a relatively large cost for once but then the labour will be cheaper and faster, maybe even increasing the production.
4.What other alternatives do they have to shutting down in the long run?
As I wrote above, using machines would be an option, which absolutely isn't rare on a farm nowadays. Though there might be farmers that don't have the money for such a machine. Another option, discussed in the podcast was to move the farms to Mexico and get the very cheap labour there. Though this idea has it's disadvantages as well. Moving costs money, and when the farmers actually have their farm in Mexico, they will have larger costs for transport and distribution. Maybe the importing of the vegetables will be a problem with the American law.
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Hi Jamie.
You didn't really answer the questions, but indirectly you answered some of them a little. I agree on the options for reducing costs though.
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1. The increase in the strictness of border controls has decreased the levels of immigration and therefore, this has significantly decreased the amount of cheap labour available to farmers.
2. Farmers may decide to move out of the market and start producing something that needs less labour or they may decide to shut down completely. Their fixed costs of production will have increased and this may mean that they have to cut down on other costs.
3. Technology may be able to increase efficiency and therefore, the farmers may be able to get more out of each crop yield. They may also be able to use technology to replace some of the workers and this would mean that they wouldn't lose too much from this output.
4. The other alternatives that they have are to either switch to producing something elsse that needs less labour or to move to a place where cheap labour is more readily available for them.
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Hi Katie,
You came up with lots of ideas that I never considered, but I was wondering if you thought about the option of farmers switching to a different market and beginning to produce a different product. Witht the land they would have had it must be possible for them to change to a different product, for example to begin keeping livestock.
Hannah
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