• TABLE OF CONTENTS
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 Front Cover
 Abstract
 Table of Contents
 Introduction
 Background on Florida's nursery...
 Labor in Florida's nursery...
 Nursery labor-- 1988 vs 1993...
 Concluding comment
 Reference














Group Title: Economics report - University of Florida Agricultural Experiment Station ; 93-1
Title: Florida's nursery industry
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Full Citation
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Permanent Link: http://ufdc.ufl.edu/UF00027503/00001
 Material Information
Title: Florida's nursery industry labor use and the impact of immigration reform
Series Title: Economics report
Physical Description: ii, 15 p. : ill. ; 28 cm.
Language: English
Creator: Haydu, John J
Hodges, Alan W ( Alan Wade ), 1959-
University of Florida -- Food and Resource Economics Dept
Publisher: Food and Resource Economics Dept., Florida Agricultural Experiment Stations, Institute of Food and Agricultural Sciences, University of Florida
Place of Publication: Gainesville
Publication Date: [1993]
 Subjects
Subject: Nurseries (Horticulture) -- Economic aspects -- Florida   ( lcsh )
Agricultural laborers -- Supply and demand -- Florida   ( lcsh )
Emigration and immigration law -- United States   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
bibliography   ( marcgt )
non-fiction   ( marcgt )
 Notes
Bibliography: Includes bibliographical references (p. 14-15).
Statement of Responsibility: John J. Haydu, Alan W. Hodges.
General Note: Cover title.
General Note: "July 1993."
 Record Information
Bibliographic ID: UF00027503
Volume ID: VID00001
Source Institution: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: aleph - 001849516
oclc - 28686950
notis - AJS3832

Table of Contents
    Front Cover
        Front Cover
    Abstract
        Abstract
    Table of Contents
        Page i
        Page ii
    Introduction
        Page 1
    Background on Florida's nursery industry
        Page 1
        Page 2
    Labor in Florida's nursery industry
        Page 3
        Page 4
        Page 5
        Page 6
    Nursery labor-- 1988 vs 1993 studies
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
    Concluding comment
        Page 12
        Page 13
    Reference
        Page 14
        Page 15
Full Text


SJulyl1993
nu/ 5,
r y3 -


Economics Report
ER 93-1


Florida's Nursery Industry: Labor
Use and the Impact of
Immigration Reform


nr,


o f -


Food and Resource Economics Department
Institute of Food and Agricultural Sciences
Cooperative Extension Service
University of Florida, Gainesville 32611


John J. Haydu
Alan W. Hodges













FLORIDA'S NURSERY INDUSTRY:
LABOR USE AND THE IMPACT OF IMMIGRATION REFORM


John J. Haydu and Alan W. Hodges
Food and Resource Economics Department
University of Florida
Gainesville, Florida 32611




Abstract

Three separate studies were examined to evaluate the supply and availability of labor
in Florida's nursery industry. All three studies lead us to the same conclusion, that
the IRCA legislation has had little or no impact on Florida's ornamental nurseries. The
wage and benefit study found that some nurseries experienced significant turnover
rates, suggesting low pay and relatively easy access to labor. Similarly, financial
indicators examined from the Business Analysis data, suggested that firms were not
hampered from a labor shortage. If immigration reform had restricted labor supplies
significantly, compensating actions by nurseries would be expected, such as a
substitution of capital for labor, higher labor costs, and greater productivity per
employee. No such evidence could be found, indicating that IRCA was not a major
impediment for the industry during this period. Finally, results of the labor study
completed in March 1993 also gave no indication of labor supply restrictions. In fact,
perhaps the most conclusive evidence was in the assertions of respondents: the
number who claimed that supplies were adequate or abundant increased from 82
percent in 1988 to 89 percent in 1993; the number who stated that immigration laws
did not adversely affect labor supplies grew from 47 to 60 percent, a substantial
increase.


Key words: Labor supply, Florida nurseries, immigration, wage rates, labor
productivity, capital-labor intensity, labor costs.


UMVJftSITY OF FVYLIaA, i~.IT,.I







TABLE OF CONTENTS



Introduction .............................................. 1

Background on Florida's Nursery Industry ........................ 1

Labor in Florida's Nursery Industry ............... ............... 3

Summary of 1987 Wage and Benefits Study ................... 3

Labor Trends from Nursery Business Analysis .................. 4

Labor Productivity ................. ................ 5

Capital-Labor Intensity .............................. 6

Labor Costs ..................................... 6

Nursery Labor-- 1988 vs 1993 Studies ........................... 7

Employment and Wage Rate Information ..................... 8

Labor Supplies and the Impact of IRCA ...................... 12

Concluding Comment ....................................... 12

References Cited ........................................... 14







LIST OF TABLES AND FIGURES



Table 1. Changes in number of firms, production area, net value of sales,
net sales per firm, and production area per firm, for Florida foliage
growers. ..................................... ... 2

Table 2. Number Respondents Using Temporary or Seasonal Labor, by
Nursery Sector, Florida, 1988 and 1993. .................. 9

Table 3. Distribution of Firms Hiring Temporary or Seasonal Workers Either
Directly or Through Labor Contractors. ................. 9

Table 4. Average hourly wage rates for selected tasks. ............ 10

Table 5. Attitudes about Supply of Seasonal Workers in Peak Week. .... 11

Table 6. Have immigration laws affected your labor supply? .......... 11






Figure 1. Labor Productivity .................................. 5

Figure 2. Capital Managed per Worker (FTE). ................... .. 6

Figure 3. Labor Costs ....................................... 7







FLORIDA'S NURSERY INDUSTRY:
LABOR USE AND IMPACT OF IMMIGRATION REFORM1

John J. Haydu and Alan W. Hodges2

Introduction

The purpose of this paper is to assess the effects of the 1986 Immigration
Reform and Control Act (IRCA) on the supply and availability of labor for Florida's
ornamental nursery industry. Like many horticultural commodity sectors, the nursery
industry relies heavily on hand labor to perform numerous tasks in the production,
care, assembly, and distribution of its products. However, a continuing problem
facing researchers who examine the nursery industry is the lack of consistent and
reliable time series data describing key aspects of the production-marketing process.
This problem is national in scope and is due in part to two factors. First, the nursery
industry has not been included in state and federal data collection efforts as have
some of the more traditional commodities like citrus, wheat, cotton, corn, and
soybeans. Second, the diversity and number of nursery crops produced annually runs
into the thousands. Consequently, to address researchable topics in a meaningful
way, investigators must often rely on periodic and costly primary data collection
studies. Addressing the impact of IRCA on the supply and availability of labor in
Florida illustrates this point.
This manuscript utilizes three separate studies to evaluate the labor supply
issue. First, a wage and benefits study conducted for the Florida Foliage Association
in 1987 is summarized. The major purpose is to provide a benchmark from which
comparisons can be made with the other two sources. A second source of labor
information is derived from the Nursery Business Analysis Program (NBA) at the
University of Florida. This program collects detailed financial information annually
from a sample of nursery firms. From this data base, labor information was extracted
for the period 1984-1991. Finally, a third source of data were generated by
replicating key portions of a labor study conducted by Polopolus, et al in 1988.
Questions addressing labor availability and the impact of IRCA were repeated to a
sample of 54 nursery firms. Results were contrasted directly with the 1988 study.


Background on Florida's Nursery Industry

Nursery and greenhouse crops represent the seventh largest agricultural
industry in the United States, with a total value of $8.4 billion at the wholesale level
in 1991 (12). Florida was the second leading state in terms of production with an
industry value of $957.8 million in 1988. This compared with California's $2.15


'Paper presented at the WRCC-76 Conference on Immigration Reform and U.S. Agriculture,
March 30, 1993.
2Associate Professor and Economic Analyst, Food and Resource Economics, University of Florida,
Gainesville.







FLORIDA'S NURSERY INDUSTRY:
LABOR USE AND IMPACT OF IMMIGRATION REFORM1

John J. Haydu and Alan W. Hodges2

Introduction

The purpose of this paper is to assess the effects of the 1986 Immigration
Reform and Control Act (IRCA) on the supply and availability of labor for Florida's
ornamental nursery industry. Like many horticultural commodity sectors, the nursery
industry relies heavily on hand labor to perform numerous tasks in the production,
care, assembly, and distribution of its products. However, a continuing problem
facing researchers who examine the nursery industry is the lack of consistent and
reliable time series data describing key aspects of the production-marketing process.
This problem is national in scope and is due in part to two factors. First, the nursery
industry has not been included in state and federal data collection efforts as have
some of the more traditional commodities like citrus, wheat, cotton, corn, and
soybeans. Second, the diversity and number of nursery crops produced annually runs
into the thousands. Consequently, to address researchable topics in a meaningful
way, investigators must often rely on periodic and costly primary data collection
studies. Addressing the impact of IRCA on the supply and availability of labor in
Florida illustrates this point.
This manuscript utilizes three separate studies to evaluate the labor supply
issue. First, a wage and benefits study conducted for the Florida Foliage Association
in 1987 is summarized. The major purpose is to provide a benchmark from which
comparisons can be made with the other two sources. A second source of labor
information is derived from the Nursery Business Analysis Program (NBA) at the
University of Florida. This program collects detailed financial information annually
from a sample of nursery firms. From this data base, labor information was extracted
for the period 1984-1991. Finally, a third source of data were generated by
replicating key portions of a labor study conducted by Polopolus, et al in 1988.
Questions addressing labor availability and the impact of IRCA were repeated to a
sample of 54 nursery firms. Results were contrasted directly with the 1988 study.


Background on Florida's Nursery Industry

Nursery and greenhouse crops represent the seventh largest agricultural
industry in the United States, with a total value of $8.4 billion at the wholesale level
in 1991 (12). Florida was the second leading state in terms of production with an
industry value of $957.8 million in 1988. This compared with California's $2.15


'Paper presented at the WRCC-76 Conference on Immigration Reform and U.S. Agriculture,
March 30, 1993.
2Associate Professor and Economic Analyst, Food and Resource Economics, University of Florida,
Gainesville.








Table 1. Changes in number of firms, production area, net value of sales, net sales
per firm, and production area per firm, for Florida foliage growers. 1984-1991 .


Year Number of Production Net Sales Prod Area Net Sales
Firmsb Area Value Per Firm (Ft2) Per Firm
(millions ft2) (millions)
1991 736 174.8 $269 2,370 $3,600
1990 816 169.0 $280 2,070 $3,400
1988 920 179.9 $279 1,950 $3,000
1986 967 193.3 $309 1,990 $3,100
1984 985 192.3 $269 1,940 $2,700

" Source: Florida Department of Agriculture, Division of Marketing Florida Crop &
Livestock Reporting Service, Orlando.
b Commercial-sized businesses with a net value of sales exceeding $10,000.


billion in sales for the same year. Florida's nursery industry grew rapidly throughout
the 1970's and early 1980's. However, maturation of the industry eventually
occurred with attendant problems of overproduction, depressed prices, low
profitability, and a growing rate of business failure (2,5,10). Table 1 illustrates this
maturation process for one industry sector3. Based on first-hand knowledge, the
authors believe similar changes have occurred in other nursery sectors as well.
Declining numbers of firms (down 25 percent), increased production area on a per firm
basis (up 19 percent), and higher unit sales (up 25 percent) represent responses to
increasingly competitive market forces. A general erosion in the financial health of
many nurseries also occurred, as is evident from results of the University of Florida's
NBA. Three performance measures-- productivity, efficiency, and profitability--
indicated that, in general, nurseries fared best during 1986 and 1987, with financial
performance declining thereafter. The last year examined, 1990, appeared to be the
most difficult for the sample of firms. The rate of return to capital for foliage
producers, for instance, fell from nearly 20 percent in 1984 to less than six percent
by 1989. Net nursery income dropped by nearly two-thirds for the same period, from
$110,800 to $41,700 (3).


3 The Florida Agricultural Statistics Service collects limited information for foliage, cut greens,
potted flowering plants, bedding plants, cut flowers, and flowering hanging baskets. Of these, the
foliage sector comprises the most complete data set. Information for woody ornamentals is excluded.
However, from a study conducted by the authors in 1989, sales from a sample of 104 wholesale
woody ornamental nurseries had an estimated value of $125 million (6).







Reasons for deteriorating financial performance are not limited to falling demand
or the recent economic downturn. Industry-wide over-production has also played a
crucial role. Lack of economies of scale in production and relatively low capital
requirements due to Florida's warm winter climate pose very low barriers to entry of
new firms. In fact, for the industry overall, the population of registered nursery firms
has grown more rapidly than aggregate sales, resulting in widespread sales of
products below costs (2,12). This oversupply problem has been exacerbated with the
advent of tissue culture. This propagative technology allows many marginal
businesses to produce large numbers of uniform plants quickly. Prior to tissue culture,
propagation was a natural filtering device eliminating many less capable firms.
Recently three separate disasters have impacted Florida's nursery industry
considerably, disrupting product supply and perhaps labor availability. First, in 1990
Du Pont's popular fungicide Benlate, was alleged to have caused widespread damage
to the state's vegetable, strawberry, and foliage plants. Although Du Pont is
presently denying direct responsibility (i.e., the company asserts that possibly improper
application procedures by the growers themselves caused the plant damage), never-
theless, major economic losses were incurred. Moreover, as of May 1992, Du Pont
has voluntarily paid out $330 million in damages, most of it to Florida growers (7).
Second, in March 1992 a severe hailstorm struck central Florida causing $30 million
of property and plant damage to foliage growers (8). Finally, in August of 1992
Hurricane Andrew caused an estimated $329 million in damage to south Florida
nurseries (4). Because the scope and severity of destruction was so pronounced,
rebuilding efforts may continue for several years. Currently this "economic vacuum"
is drawing large numbers of both skilled and unskilled labor into the area. This
locational shift in labor is expected to affect the nursery industry as well as many
other labor markets.


Labor in Florida's Nursery Industry

Summary of 1987 Wage and Benefits Study

A wage and benefits survey of Florida Foliage Association (FFA) members was
completed in July 1987 (1). The purpose of the survey was to inform members of
current wage and benefits practices within the industry. Approximately 450
questionnaires were mailed to FFA members. The survey included a description of 18
common jobs typically found in nurseries, as well as information regarding wage rates
paid and data on current fringe benefits provided to employees.
The survey revealed a wide range of wage and benefits practices among
nursery operators. Some nurseries appeared progressive and innovative; others were
new and just beginning to formulate their compensation policies. The study indicated
owner/managers were strongly concerned with the impact of wages on profitability.
Still, many employers claimed to use compensation as a tool to provide quality
products and to retain an effective work force. The survey disclosed that the average








wages actually paid for similar positions varied widely by geographic area. Southeast
Florida typically paid about 10 to 16% more for nursery workers than employers in
central Florida and 15-20% more than employers in the western part of the state.
The survey provided useful data on wage classification structures. It was
found, for example, that in some nurseries workers started at $3.35/hour (minimum
wage at the time) while others in the same geographic area began workers at
$4.40/hour. Maximum rates paid for similar jobs also varied widely. For instance,
maximum shipping worker wages varied from a low of $3.80/hour to a high of $9.03/
hour. These variances could reflect cost-of-living differentials across areas, the
tightness of the local labor markets at the time, the number of long-term employees,
turnover rates, or unique aspects of job assignments.
No consistent pattern emerged indicating that business size had any strong
influence on wage patterns. In fact, in many cases, top pay was found in smaller
units. This may suggest more careful compensation practices in large units or the
possibility of broader and more varied responsibilities in smaller units. The survey also
found that some employers paid below minimum wage. While this may have been
due to special circumstances or to clerical errors in completing the survey form, it
warrants attention.
A review of turnover statistics suggests that some nurseries experienced
significant turnover (i.e., in excess of 200% annually). The higher turnover appeared
to be in the medium or larger size organizations. Pay-levels may have been a factor
in employee retention. Some nurseries adopted practices for retaining long-term
employees, such as special raises, one-time bonuses, profit sharing, service awards,
added health benefits, and vacation trips.
The 1987 wage and benefits study provides a rough picture of some labor
issues for an important sector of Florida's nursery industry. Labor represents the
single greatest cost for most nurseries. How this cost was dealt with varied greatly
from firm to firm, based on wage differentials, incentive programs, and the strong
concern of managers with the impact of wages on profitability. From this information
we may conclude that, for some nursery sectors, IRCA legislation could have posed
a significant problem. How it eventually impacted the industry is now discussed in
the following two sections.


Labor Trends from Nursery Business Analysis

Labor trends in Florida's nursery industry were evaluated with data from the
University of Florida's Nursery Bysiness Analysis (NBA). This ongoing program gathers
confidential business records from wholesale ornamental nursery firms in order to
develop industry standards for business performance and to analyze individual firm
performance. A total of 707 records were collected from 234 firms for the period
1984 through 1991. This timeframe allows a comparison of business performance
before and after the implementation of IRCA. Because participating firms were
accepted on a voluntary basis, the data set was not a statistically designed sample








of firms, however, it is probably representative of firms with above-average
management quality, by virtue of their willingness to participate in such quality
improvement programs.

Data were separately compiled and analyzed for firms classified in five different
sectors of the ornamental nursery industry: containerized woody ornamental plants,
field-grown woody ornamental plants, flowering plants, and tropical foliage plants in
sub-regions of Central and South Florida. Data included 252 records for container
firms, 60 for field firms, 163 for Central Florida foliage firms, 199 for South Florida
foliage firms, and 33 for flowering plant firms. Within each industry grouping, data
were also analyzed for highly profitable firms, which were defined as having returns
to net worth greater than 30%. Results were weighted by firm size in each group in
order to represent the greater impact of large firms. Dollar values for these time series
data were adjusted for inflation by deflating with the consumer price index (base year
1982-84).

Labor Productivity. Productivity was measured in terms of value produced per full-time
equivalent worker (FTE, 2080 hrs/year). Total annual production of firms was
measured as annual sales plus change in plant inventory value. Data collected on total
employee hours worked were expressed as full-time equivalents (2080 hours per
year).


Figure 1 shows that
labor productivity
generally declined over
the 1984-1991 period
for all firms and for
profitable firms. For all
firms, average labor
productivity declined
from $60K per FTE in
1984 to $46K per FTE
in 1989, then
rebounded to $48K per
FTE in 1991. Overall,
this represented a 20.1
percent decrease in
labor productivity.
Profitable firms had a
generally higher level of
labor productivity and
showed a similar steady
decline from $80K per
FTE in 1984 to $55K


Figure 1--Labor productivity. Value of production pei
full-time equivalent person (FTE, 2,080 man-hours pei
year), including production, sales, administrative, an
management personnel.


Hlghly profitable firms

\ /
\ /
\ /
\/


| S0 -





jE
*O0


S50 -


| I I I I I
1S985 186 19M7 1988 19819 130
Year









per FTE in 1991. Among industry groups there were substantial differences in overall
levels of labor productivity, however, only flowering plant nursery firms showed a
different trend, with value produced per FTE increasing between 1987 and 1991. The
rate of decline in labor productivity after IRCA (1988-1991) did not appear to differ
from the rate prior to IRCA (1984-1987). Therefore, we conclude that IRCA did not
likely influence the trend already underway. The decline in labor productivity is
attributed to increasing competition leading to lower product prices in the industry.

Capital-Labor Intensity is an indicator of the balance of labor and capital resources
utilized. It was measured as the ratio of total managed capital (owned plus leased) to
employment (FTE). Assets and liabilities were evaluated at book value stated on
company financial statements, including investments in land, buildings, improvements,
equipment, and plant inventories. Leased capital assets in land, buildings, and
equipment were evaluated at current market value.


As shown in Figure 2,
capital-labor intensity
varied irregularly from
year to year, which may
reflect the changing
sample of firms. All
firms and profitable
firms had similar levels
for most years of the
study period. For all
firms, capital managed
per employee increased
slightly from $74K in
1984 to $80K in 1987,
then declined to $62K
in 1990 before
rebounding to $83K in
1991. Profitable firms
also showed a
significant rebound in
capital managed per


Figure 2--Capital managed per worker (FTE).
owned and leased capital.


Capital managed included


employee in 1991 following a period of general decline during 1988 through 1990.
The pattern of trends was apparent for all industry groups. Field nurseries had higher
levels of capital managed per FTE, reflecting their greater mechanization and lower
labor intensity with respect to capital as well as production space.

Labor Costs are perhaps the most important indicator of trends in labor economics.
In this analysis, labor costs included all wages, salaries, payroll taxes, and fringe
benefits for all employees. To remove effects of varying firm sizes, labor costs were


100
All ffrms -
Highly profitable firms- -
90





FE
I \I


70 I
\ I*



S 60 I \ '


1984 1985 1986 198B7 198S8 1989 1990 1991
Year







evaluated as a share of
value produced. As
shown in figure 3, labor 1
costs generally followed 8
an increasing trend from a& -
1984 through 1991. s I Ifirm
Labor costs for all firms >
increased by 39 percent /
during this period, from b \ highly proft.bl firm
25 percent of value t ,
produced in 1984 to 35 ,
percent in 1991. / \
20% I \ -
Profitable firms had ', -
substantially lower labor .
costs overall, but had
even more markedly 1as i I i
1984 1985 1986 1987 1988 1999 1990 1991
increased costs, from Year
17 percent of value
produced in 1984 to 29 Figure 3--Labor costs as a share of value produced, including wages,
percent in 1991. In salaries, payroll taxes, and fringe benefits.
contrast to the general
trends, flowering plant nurseries showed a decrease in labor costs from 42 percent
of value produced in 1984 to 29 percent in 1991, reflecting their improved
productivity.
The rate of increase in labor costs was not discernably different in the pre-IRCA
and post-IRCA periods (1984-1987, 1988-1991, respectively). This does not support
the hypothesis that immigration reform caused a tightening of labor supply which
would increase labor costs. However, neither does this rule out the possibility that
changes in labor supply brought about by change in immigration policy reinforced
labor market trends already underway.


Concluding Statement. From the three indicators examined (labor productivity, capital-
labor intensity, and labor costs), there is no strong evidence to conclude that IRCA
legislation acted as an impediment to the supply and availability of labor to the nursery
industry. At the same time, neither does the data indicate what measures or actions
employers may have taken to circumvent or blunt the impact of this legislation.


Nursery Labor-- 1988 vs 1993 Studies

In the spring and summer of 1988, a study was conducted for the purpose of
determining wage rates to seasonal workers, prospective labor supplies, and the likely
impact of IRCA upon the availability of seasonal workers (9). Although the full impact








of the immigration legislation may not have been felt in 1987, the information
obtained provides a solid benchmark for labor conditions and producer concerns at the
time. With this in mind,-we selected several key issues from the 1987-88 study and
examined them again for the 1992 calendar year. Major questions asked include: (1)
the number of firms hiring temporary/seasonal workers directly or through contractors,
(2) average hourly wage rates for selected tasks, (3) attitudes about supply of
seasonal workers in peak week, and (4) producers views regarding the impact of IRCA
on labor supply.
The sample of respondents for the 1993 survey was obtained from trade
association member lists for foliage, woody ornamental, and cut fern growers. Fern
growers were chosen randomly by selecting every n* producer. Foliage and woody
growers were selected semi-randomly in that the sample focused on larger firms. The
rationale for this approach was that more information can generally be obtained from
larger businesses; larger businesses also comprise the greater share of the industry
with regard to volume of sales. A survey instrument was developed based on
questions from the 1987-88 study. Due to the small amount of time available, a
decision was made to conduct the survey by phone utilizing a professional market
survey organization. From a target population of 183 potential respondents, 54
completed questionnaires were obtained representing a 30 percent response rate
(Table 2).


Employment and Wage Rate Information

In contrast to fruit and vegetable industries, year around employment is much
more common for ornamentals producers, except ferneries (9). In 1992, roughly 60
percent of ornamental nurseries interviewed claimed to utilize direct hire only (Table
3). This represents a considerable decline since 1987 when 94 percent reported
hiring labor directly. Similarly, the number of respondents claiming to hire indirectly
through labor contractors increased from 3 to 13 percent, and those indicating some
form of both methods grew from 3 percent to 28 percent between 1987 and 1992.
In other words, based on results of these two studies, there was a discernable shift
towards greater use of indirect labor. How much of this is due to IRCA and how
much can be attributed to other factors, is unclear. For instance, one response to
increased competition and narrower profit margins which has been a common
experience for Florida ornamental producers, is to reduce the permanent labor force.
This would be particularly true in locations where seasonal labor is readily available.
Average hourly wage rates were also examined to determine if changes
occurred during the past five years. One might expect, for example, that if the impact
of IRCA did reduce the supply and availability of labor for the nursery industry, wage
rates would increase to offset this trend. Three types of hand skills were identified
for wage rate estimation: potting/planting, hand harvesting, and packing/shipping
(Table 4). Although the latter activity was not examined in the 1987 study, it was







Table 2. Number Respondents Using Temporary or Seasonal Labor, by Nursery
Sector, Florida, 1988 and 1993.

---------------Nursery Sector------------

Year Foliage Fern Woody Total
---------------Number-------------

1988a 71 17 30 118
1993 11 19 24 54

* From Polopolus, et al, 1990.






Table 3. Distribution of Firms Hiring Temporary or Seasonal Workers Either
Directly or Through Labor Contractors.

---------- Employment Category----------

Year Industry Hired Contract Hired & Contract Total
--------------percent--------------

1988a Foliage 88 6 6 100
Fern 100 0 0 100
Woody 94 4 2 100
Total 94 3 3 100


1993 Foliage 64 0 36 100
Fern 58 31 11 100
Woody 56 8 36 100
Total 59 13 28 100
" From Polopolus, et al, 1990.








Table 4. Average hourly wage rates for selected tasks.


Labor Activity ---------------Industry-------------
Foliage Fern Woody Average

Potting/Planting -------------Dollars/hr.-------------
1993 4.85 3.72 4.42 4.39
1987/88' 4.29 4.83 4.52 4.54
Harvesting
1993 4.69 5.42 7.35 6.18
1987/88" 4.59 5.50 4.55 4.88
Packing/Shipping
1993 5.29 5.67 8.15 6.40
1987/88" N/A N/A N/A
Machine Operation
1993 5.08 4.88 6.97 6.07
1987/88" 5.80 6.01 5.64 5.81
Perm. Field Workers
1993 5.53 5.68 5.45 5.55
1987/88" 4.92 5.16 4.82 4.96

From Polopolous et al, 1990




included for 1993 because it represents an essential task and can be used as a
benchmark for future studies. Two additional wage categories from the 1988 survey
were compared as well: machine operation and average hourly wages for permanent
employees.
With the exception of potting and planting, there were only modest wage
increases over the five years for the tasks identified. Wage increases were found for
hand harvesting (20 percent), machine operation (5 percent), and for permanent
employees (10 percent). For potting activities, the 1993 survey indicates hourly wage
rates declined in both the fern and woody sectors whereas they increased for foliage.
The drop in wages was considerable in the fern industry, nearly 25 percent.








Table 5. Attitudes about Supply of Seasonal Workers in Peak Week.


'ear Industry
993 Foliage
Fern
Woody
Total
Column Percent


Not Enougi
1
3
0


4
11%


-----------Response------------

h Adequate Abundant
4 4
8 1
10 5
22 10
61% 28%


1987/888 Foliage
Fern
Woody
Total
Column Percent


30
18%


46
11
66
123
74%


4
2
7
13
8%


61
17
88
166
100%


* From Polopolous et al, 1990




Table 6. Have immigration laws affected your labor supply?

---------1993-------- -------1987/88"-------

Industry Yes No Total Yes No Total
Foliage 2 6 8 32 32 64
Fern 9 4 13 12 5 17
Woody 3 11 14 46 42 88
Total 14 21 35 90 79 169
40% 60% 100% 53% 47% 100%


a From Polopolous et al, 1990


Y
1


Total
9
12
15
36
100%


"








Interestingly, for 1987, the fern industry reported the highest wages paid for all
activities, including machine operation and for permanent employees. Why this trend
reversed is unclear. However, it should be noted that the fern industry is typically the
most likely sector to utilize seasonal labor.

Labor Supplies and the Impact of IRCA

Questions were asked about employer attitudes concerning the supply of
seasonal workers during the peak week (Table 5). In 1987/88, 74 percent of
respondents deemed the supply adequate and 8 percent abundant. Conversely, nearly
20 percent believed seasonal labor supplies were inadequate. Of the three producer
groups, fern growers were the least likely to claim that labor supplies were
insufficient. By 1993 attitudes had shifted discernably. For the present study, nearly
90 percent of respondents believed supplies of seasonal labor were either adequate
or abundant. Similarly, the number claiming they were inadequate dropped from 18
to 11 percent.
Finally, changes can also be seen regarding attitudes on the impact of IRCA on
labor availability (Table 6). During 1987/88, 53 percent of respondents felt that
"immigration laws" affected labor supplies adversely. Fern growers were most likely
(70 percent affirmed) to make this claim. In contrast to this, five years later only 40
percent of respondents believed immigration hurt labor supplies. However, fern
growers as a group remained unchanged in their views regarding IRCA, that is, 69
percent believed it was a problem.


Concluding Comment

Three separate methods were used to assess the effects of IRCA on the supply
and availability of labor on Florida's nursery industry. Basically, all three lead us to the
same conclusion, that the IRCA legislation has had little or no impact on ornamental
nurseries. In the 1987 wage and benefits study, considerable variability in wages was
found for similar types of activities. Some employers appeared concerned over
employee retention, others did not. One section of the study mentioned that some
nurseries experienced significant turnover rates, suggesting low pay and relatively
easy access to labor.
For the nursery business analysis three indicators-- labor productivity, capital-
labor intensity, and employee labor costs were examined for the 1984-1991 period.
If immigration reform had restricted labor supplies significantly, compensating actions
by nurseries would be expected, such as a substitution of capital for labor, higher
labor costs, and greater productivity per employee. In fact, no such evidence could
be found from the sample of nurseries examined, indicating that IRCA was not an
impediment for the industry during this period.
Finally, results of the labor study completed in March 1993 and compared to
a similar study completed in 1988, gave no indication of labor supply restrictions. In








fact, perhaps the most conclusive evidence was in the assertions of respondents: (1)
the number who claimed that supplies were adequate or abundant increased from 82
percent in 1988 to 89 percent in 1993; (2) likewise, the number who stated that
immigration laws did not adversely affect labor supplies grew from 47 to 60 percent,
a substantial increase.








References Cited


1. Brown, W. 1987. "Wage and benefits study for Florida Foliage Association,
W.A. Brown & Assoc., Tangerine, FL. 91 p.

2. Haydu, J.J. 1989. "What's happening to Florida's ornamental industry?" Florida
Nurseryman 36(9), Sept. pp.25,27,29,30.

3. Haydu, J.J. 1991. "Recent financial performance of central and south Florida
foliage nurseries." Plant Market News 1(2), Florida Coop. Ext. Serv. Bull., Food
& Resource Econ. Dept, Univ. of Florida, Gainesville, 4 p.

4. Hodges, A. 1992. "Hurricane Andrew Crop Loss and Replanting Cost Estimate
for the Ornamental Nursery Industry in Dade County," Unpublished report,
Sept. 14, 1992, Food & Resource Econ., Univ. of Florida, Gainesville.

5. Hodges, A.W. and J. Haydu. 1989. "Challenges facing the Florida ornamental
industry. Proc. Florida State Hort. Soc. 102:86--89. Winterhaven, FL.

6. Hodges, A.W. and J. Haydu. 1990. "An economic overview of Florida's woody
ornamental industry." Econ. Rpt 120, Food & Resource Econ., Univ of Florida,
Gainesville, 14 p.

7. Jackson, J. 1992. "Du Pont reports no more threat from fungicide." Orlando
Sentinel, May 8, Orlando, FL.

8. Jackson J. and M. Pankowski. 1992. "Storm batters foliage industry for $30
million." Orlando Sentinel, March 27, Orlando, FL.

9. Polopolous, L., S. Moon, and N. Chunkasut. 1990. "Farm labor in the
ornamental industries of Florida. Econ. Infor. Rpt 283. Food & Resource Econ.
Dept., Univ. of Florida, Gainesville.


10. Strain, J.R. and A. Hodges. 1989. Business analysis of container nurseries in
Florida. Econ. Infor. Rpt. 266. Food & Resource Economics Dept., Univ. Florida,
Gainesville, 35 p.

11. University of Florida. 1992. Nursery Business Analysis Program. Inst. Food
Agr. Sci., Food & Resource Econ. Dept, Univ. of Florida, Gainesville.

12. U.S. Dept. of Agriculture. 1991. Economic Indicators of the Farm Sector: State
Financial Summary, 1989. ECIFS 9-3, Economic Research Service, Wash.D.C.
238p.








13. U.S. Dept. of Agriculture. 1993. Economic Indicators of the Farm Sector:
National Financial Summary, 1991. ECIFS 11-1, Economic Research Service,
Wash.D.C. 89p.




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