Rising H-2A Wage Rates Pressure Farm Labor Costs

Farmers should anticipate continued upward pressure on farm labor costs and monitor policy changes that may further impact hiring decisions.

NASHVILLE, Tenn. (RFD-TV) — University of Georgia agricultural economist Cesar L. Escalante says rising Adverse Effect Wage Rates (AEWRs) are driving affordability concerns in the H-2A guest farmworker program.

AEWRs are set annually using the USDA’s Farm Labor Survey and are meant to ensure foreign workers earn fair pay without depressing domestic wages. The 2025 national AEWR is $17.74 per hour, nearly 18 percent higher than 2022 levels and above the long-term average growth rate of 3.5 percent.

Beyond hourly wages, H-2A employers must cover housing, transportation, meals, and insurance, which Escalante notes adds about a 5 percent premium to labor costs. Critics argue the AEWR system often produces abrupt wage spikes and does not fully reflect local labor conditions. Even so, Escalante’s analysis suggests H-2A labor remains cost-competitive compared with domestic hiring, especially when fringe benefit offsets are included.

Separately, although distinct from the H-2A program, the Trump administration is proposing a $100,000 fee per H-1B visa. Escalante warns that rising costs and new visa fees highlight how changes in immigration policy could reshape the labor supply for American farms.

Related Stories
University of Illinois Ag Economist Gary Schnitker says early projections indicate soybeans will be more profitable than corn in 2026.
In a final rule published in the Federal Register, the Department states that it will no longer base wage rates on the Farm Labor Survey.
The Senate failed to pass a continuing resolution that had been approved by the House the previous week. They could take it up again today, but it would take seven democrats to end the stalemate.
Livestock and government payments provide a boost, but crop receipts and rising expenses keep pressure on margins. Strong financial planning remains key in a volatile environment.
North Dakota Farmers Union (NDFU) President Mark Watne joined us Monday to share his perspective on the America First Trade Promotion Program and potential implications for producers.
Duane Simpson, CEO of the National Council of Farmer Cooperatives (NCFC), joined us in Monday’s Market Day Report to share his perspective on the USDA’s plan and potential impact on producers.

Tony St. James joined the RFD-TV talent team in August 2024, bringing a wealth of experience and a fresh perspective to RFD-TV and Rural Radio Channel 147 Sirius XM. In addition to his role as Market Specialist (collaborating with Scott “The Cow Guy” Shellady to provide radio and TV audiences with the latest updates on ag commodity markets), he hosts “Rural America Live” and serves as talent for trade shows.

LATEST STORIES BY THIS AUTHOR:

Federal assistance has helped, but the most recent row-crop losses remain on producers’ balance sheets.
Rebuilding domestic textiles depends on automation and vertical integration, not tariffs or legacy manufacturing models.
Strong supplies and rising stocks point to continued price pressure unless demand accelerates.
Seasonal price patterns can inform soybean marketing timing, particularly when harvest prices appear unusually strong or weak.
Low prices are painful now, but production response could support stronger milk markets later in 2026.
The U.S. trade deal with Argentina creates new export opportunities for U.S. livestock and crop producers but also raises competitive concerns.