and wages in food processing:
Figure 1: Foreign born labor force (nsa) as share of civilian labor force over 16 (sa) (blue, left scale), and real wage in nondurables manufacturing – food, in 2022$ (tan, right log scale). Uses chained CPI seasonally adjusted using X13. NBER defined peak-to-trough recession dates shaded gray. Red dashed lines at Trump administration. Source: BLS, NBER, and author’s calculations.I chose food processing wages (food processing) because it was in one of the sectors with the highest proportion of foreign born labor (nondurables) and at the same time highest job vacancies in 2021.
Source: Peri, Zalour, EconoFact (2022).As the trend in foreign-born in the labor force has been re-established, the relative wage was come back to trend.For comparison, here are nondurables and food services real wages over time.
Figure 2: Real wage in nondurables manufacturing – food, in 2022$ (tan), in nondurables manufacturing (light blue), in hospitality and leisure – food services (green). Uses chained CPI seasonally adjusted using X13. NBER defined peak-to-trough recession dates shaded gray. Red dashed lines at Trump administration. Source: BLS, NBER, and author’s calculations.The surge in real food processing wages relative to trend seems to coincides with the shortfall.So, at least part of the inflationary pressures of 2021-22 can be attributed to the policies of the Trump administration, with respect to immigration/border policies, as well as the implementation of Title 42 (public health measures).Agricultural (in the field) worker wages are not in Figure 2, unfortunately. Here is annual data, from a different data set.
Source: USDA.The impact of the immigration shortfall on the low wage labor force is only part of the story. For other implications, see Peri, Zalour, EconoFact (2022).More By This Author:A Decomposition Of Per Unit Price Inflation In Nonfinancial Corporate Sector, Through 2023Q3
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