The Commercial Appeal

Less immigrant labor adding to price hikes

Businesses grapple with worker shortage

- Nicholas Riccardi

Just 10 miles from the Rio Grande, Mike Helle’s farm is so short of immigrant workers that he’s replaced 450 acres of labor-intensive leafy greens with crops that can be harvested by machinery.

In Houston, Al Flores increased the price of his barbecue restaurant’s brisket plate because the cost of the cut doubled due to meatpackin­g plants’ inability to fully staff immigrant-heavy production lines. In the Dallas area, Joshua Correa raised prices on the homes his company builds by $150,000 to cover increased costs stemming partly from a lack of immigrant labor.

After immigratio­n to the United States tapered off during the Trump administra­tion – then ground to a near complete halt for 18 months during the coronaviru­s pandemic – the country is waking up to a labor shortage partly fueled by that slowdown.

The U.S. has, by some estimates, 2 million fewer immigrants than it would have if the pace had stayed the same, helping power a desperate scramble for workers in many sectors, from meatpackin­g to homebuildi­ng, that is also contributi­ng to supply shortages and price increases.

“These 2 million missing immigrants are part of the reason we have a labor shortage,” said Giovanni Peri, an economist at the University of California at Davis. “In the short run, we are going to adjust to these shortages in the labor market through an increase in wages and in prices.”

The labor issues are among several contributo­rs to the highest inflation in 40 years in the United States – from supply chains mangled by the pandemic to a surge in energy and commodity prices following Russia’s invasion of Ukraine.

Steve Camarota, a researcher at the Center for Immigratio­n Studies, which advocates for less immigratio­n, believes a spike in illegal immigratio­n under President Joe Biden will make up whatever shortfall lingers from the pandemic. He also contends wage increases in low-paying sectors like agricultur­e are minor contributo­rs to inflation.

“I don’t think wages going up is bad for the poor, and I think mathematic­ally it is not possible to drive down inflation by limiting wages at the bottom,” Camarota told The Associated Press.

Immigratio­n is rapidly returning to its pre-pandemic levels, researcher­s say, but the U.S. would need a significant accelerati­on to make up its deficit.

A recent Gallup poll showed worries about illegal immigratio­n at a twodecade high. With a tough election for their party looming in November, Democrats are increasing­ly divided about the Biden administra­tion’s attempt to end pandemic-related restrictio­ns on seeking asylum.

“We’re feeling it and, if we’re feeling it at the end of the day as builders and developers, the consumer pays the price,” said Correa, who spoke from Pensacola, Florida, where he brought a constructi­on crew as a favor to a client whose hasn’t been able to find laborers.

 ?? LM OTERO/AP ?? Tile subcontrac­tor Horacio Gomez, left, confers with home builder Joshua Correa about plans at a home under constructi­on in Plano, Texas. There are an estimated 2 million fewer immigrants than expected in the U.S., helping fuel a desperate scramble for workers in many sectors. It’s also contributi­ng to product shortages and price increases.
LM OTERO/AP Tile subcontrac­tor Horacio Gomez, left, confers with home builder Joshua Correa about plans at a home under constructi­on in Plano, Texas. There are an estimated 2 million fewer immigrants than expected in the U.S., helping fuel a desperate scramble for workers in many sectors. It’s also contributi­ng to product shortages and price increases.

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