Recent H-2A Wage Hikes' Divergent Effects on Workers' Welfare and Farm Business Viability

Starting in 2023, the H-2A program’s adverse effect wage rate (AEWR) suddenly increased significantly in several states. This article demonstrates the policy’s two conflicting sides. Disparities in regional AEWR growth and living wage gaps validate the policy’s subscription to the social equalizing principle that protects workers’ rights to fair compensation. Our analysis, however, also presents serious business repercussions confirming many farmers’ claims of significantly deteriorating incomes and profit margins. This study reminds policymakers to carefully balance policy consequences affecting different constituent groups, with consideration given on timing, targeting, and remedial follow-up measures to mitigate adverse effects on affected sectors.