As unprecedented economic expan-sion continues in the U.S.,employers face increased competi-tive pressures to obtain workers necessaryfor their businesses. In this competitiveenvironment, U.S. farmers are holdingtheir own, securing similar numbers ofhired laborers as in previous years andable to provide wage increases that gener-ally keep pace with the cost of living.However, U.S. farmers rely heavily onforeign-born workers, most of whomcome from Mexico and many of whomlack legal authorization to work in theU.S. This phenomenon appears to bemore prevalent than in the past andreflects wage differentials for farm laborbetween the U.S. and Mexico, as well asdifferences in employment prospects.In contrast, Mexican agriculture hasaccess to a sizable pool of native-bornworkers. Farmworkers in Mexico, as inthe U.S., typically complement theiremployment in agriculture with nonfarmwork. But unlike in the U.S., farmworkersare in relatively plentiful supply inMexico and provide a stable, legal sourceof labor for agriculture. This will benefitMexican farmers as they seek out newexport markets. Differences in the avail-ability of farm labor affects the economichealth of agriculture in both Mexico andthe U.S, including the extent to whichagricultural producers participate in inter-national markets.Characteristics of Hired Farm LaborU.S. agriculture employed an average of890,300 hired farmworkers in 2000,according to USDA’s NationalAgricultural Statistics Service (NASS).The number of hired farmworkers fluctu-ates seasonally, from roughly 700,000 inJanuary to 1.1 million in July. Semi-annu-al data suggest an upward trend in thenumbers of hired farmworkers from 1996to 1999, followed by a decrease in 2000.In October 2000, the average wage forhired farmworkers in the U.S. was $8.29per hour. Wages for field and livestockworkers were generally lower, averaging$7.76 per hour. (The average wage forhired farmworkers does not reflect hous-ing and food benefits that some farm-workers receive from their employers.) Atthe same time, the average wage outsideagriculture was $13.69 per hour and theFederal minimum wage was $5.15 perhour. Like the total number of hired work-ers, the wage for hired farm labor fluctu-ates seasonally, but has tended to keeppace with the cost of living since 1996. The relatively high agricultural wage ratesin the U.S. attract foreign-born farmwork-ers, especially from Mexico. According todata from the Department of Labor’sNational Agricultural Workers Survey(NAWS), people born in Mexico made up78 percent of all U.S. farmworkers in cropagriculture in fiscal year (FY) 1998, upfrom an annual average of 68 percent dur-ing FY’s 1993-95. People born in CentralAmerica constituted an additional 3 per-cent of farmworkers in crop agriculture.NAWS data also show that 57 percent ofMexican-born farmworkers were undocu-mented (i.e., lacked legal immigration sta-tus) in FY 1998, compared with an aver-age of 51 percent during FY’s 1994-95.The figures are similar for all foreign-born farmworkers in U.S. crop agricul-ture—i.e., 57 percent were undocumentedin FY 1998, up from an average of 50percent during FY’s 1994-95.Off-farm employment provides an impor-tant supplement to agricultural earningsfor both native and foreign-born farm-workers. During FY 1998, farmworkers inU.S. crop agriculture were employed foran average of 34 weeks in the U.S.—31weeks in agriculture and 3 weeks in non-farm employment. An additional 8 weekswere spent in the U.S. not working, and 9weeks were spent outside the country.U.S.-born farmworkers devoted a greaterportion of the year to nonfarm employ-ment, while the foreign-born, not surpris-ingly, spent a greater portion of the yearabroad. Among foreign-born farmworkers,time spent abroad averaged 11 weeks inFY 1998, up from an average of 8 weeksduring FY’s 1993-94. Possible explana-tions for this shift include heightenedenforcement of U.S. immigration restric-tions; improved economic conditionsabroad that lure foreign-born workers tojobs in their home countries; and the pos-sibility that increased U.S. earnings, eitherfrom farm or nonfarm employment, allowforeign-born farmworkers to spend moretime in their native countries.In Mexico, agriculture employed about2.3 million people above the age of 12 ashired laborers in 1998, according to theMexican Secretariat of Labor and SocialProvision’s Encuesta de Empleo(Employment Survey). An additional136,000 workers performed specializedtasks in agriculture, such as the operationof machinery, and another 3.5 millionFarm & Rural Communities14 Economic Research Service/USDA Agricultural Outlook/January-February 2001Hired Farm Labor: Comparing the U.S. & MexicoMexicans worked without pay in the farmoperations of their families. The potentialpool of agricultural workers in Mexicothus consists of almost 6 million people.Agricultural employment in Mexicodecreased 0.7 percent between 1996 and1999, due primarily to urbanizationabsorbing land and labor in the states ofcentral Mexico. In these states, agricultur-al employment is falling at an averageannual rate of 7.6 percent. In the rest ofthe country, however, agricultural employ-ment is growing at an annual average rateof 3.8 percent. Agriculture employs a large proportion ofthe population in some parts of Mexico.This is particularly true in the southernstates, which have relatively high levels ofpoverty and a larger indigenous popula-tion. For example, agriculture represents56 percent of employment in Chiapas,Mexico’s poorest state.Labor productivity in Mexican agricultureis roughly one-fifth the productivity in therest of the economy. About 20 percent ofthe workforce is engaged in agriculture,but the sector contributes just 5 percent ofGDP. Labor productivity tends to increaseas production shifts from basic grains tomore export-oriented crops such as fruitsand vegetables. Government efforts toraise productivity in agriculture concen-trate on training and technology transferby private extension services supported bythe Mexican government.The wage differential between Mexicanand U.S. agriculture is huge. The dailywage for 8 hours of farm work in Mexicois about $3.60 in U.S. currency, comparedwith the U.S. average of $66.32 inOctober 2000. However, these figuresoverstate the real wage differentialbetween Mexican and U.S. agriculture,because the cost of living in Mexico islower than in the U.S.Agricultural wages in Mexico decreasedin real terms at an average annual rate