Slesinger, Doris, and Steven Deller
Working paper no. 2002-06
This study aims to determine the impact of migrant workers on Wisconsin’s economy, and addresses three questions: How do migrant workers spend their money? What migrant-related investments do employers of migrants make? What amount of federal funds flows into the state? To answer these questions, we interviewed 161 migrant workers, surveyed 56 migrant-worker employers by mail, and analyzed published sources of migrant-related data.
Currently, somewhat over 5,000 migrant workers plus 1,000 dependents arrive in Wisconsin annually. Most are of Mexican heritage with homes in Texas. Two-thirds work in canning or food-processing, and one-third in agricultural fields. About one-half travel singly, the remainder in family groups. In 2001, average weekly pay for singles was $349, for families $659. Migrants spent about half their earnings in Wisconsin. Also, about half the singles and one out of seven families sent remittances home.
Growers paid migrants an average hourly wage of $7.26; the average paid by food processors was $6.82. About two-thirds of both growers and food processors provided housing for migrants. On average, growers spent $13,600 on migrant housing; food processors averaged $37,700. As for costs of recruiting migrant workers, half the growers spent nothing, and half spent an average of $6,400. Nearly all food processors reported recruiting costs, averaging $10,328.
Growers and food processors held divergent views on several migrant-related matters, as revealed in a mail survey to employers. Were migrant labor unavailable, growers said they were likely to close their business, go into other lines of work, or sell their land or equipment. But most food processors, faced with the absence of migrant labor, indicated they would be likely to mechanize. Only a few growers, but half the food processors, said that they would raise wages to attract local workers were migrant labor unavailable.
The direct spending of funds by and on migrants, and the indirect, or re-spending, was found to result in an estimated $14,856,000 of added income to Wisconsin businesses and residents per year and the creation of 417 jobs. The bulk of these employment and income impacts of the migrant workforce was derived from direct spending by migrants. In addition, “special purchases,” such as stereos, VCRs, automobiles, tires, and furniture by migrants amounted to $750 for the season for single workers and $1,117 for workers with families. Economic analysis was employed to estimate the indirect or re-spending impacts of migrant purchases. The presence of the Wisconsin migrant workforce led to over $8,700,000 being added to tax revenues for the state and local governments in 2001. The lion’s share of these additional tax revenues (about $7,229,000) came from federal grants that have both direct and secondary effects on local economies.