Milk prices jumping from $7 to $14, strawberries that feel like luxury goods, and a switch to processed food: This is the six-month outlook economists studying labor and agriculture see for consumers.\u00a0<\/p>\n
Yet these consumers \u201cdon\u2019t have a clue what\u2019s going on,\u201d\u00a0Raymond Robertson, a labor economist at Texas A&M\u2019s Bush School of Government who has advised U.S. agencies on trade and labor policy, told Fortune.<\/p>\n
Instead, Robertson said, voters are distracted by the political noise of President Donald Trump\u2019s policies, while the real drivers of grocery sticker shock\u2014labor shortages<\/a> and tariffs\u2014<\/a>continue to tighten their grip. Deportations have thinned fields and stripped farms of undocumented workers, who \u201coverwhelmingly\u201d make up the agricultural workforce. At the same time, new tariffs on staples like tomatoes<\/a>, coffee, and orange juice<\/a> are pushing up costs on imports, leaving few affordable alternatives.<\/p>\n \u201cThe impacts are unambiguous,\u201d Gordon Hanson, an economist and expert on Mexican trade at Harvard Kennedy School, told Fortune. \u201cIt\u2019s upward pressure on those prices.\u201c<\/p>\n The White House did not immediately respond to Fortune\u2019s request for comment.<\/p>\n The only question, Hanson added, is how much of the pain farmers, wholesalers, and retailers can absorb before it lands on the grocery aisles and in consumers\u2019 carts.\u00a0\u00a0<\/p>\n Winter grocery chill<\/p>\n The first wave of grocery-price increases will likely hit this winter. Roberson predicted produce prices could rise 50% to 100% by early next year as inventories clear and new contracts kick in. And unlike past decades, when Washington would quietly ease border enforcement to keep fields staffed, today\u2019s political environment suggests no such check.<\/p>\n \u201cThis is like when you see a flood coming, the tsunami is coming in, and the water\u2019s gone up two inches,\u201d Robertson warned.<\/p>\n The reason for the labor shortage is American-born workers simply do not want to do manual work at the wages typically offered to foreign-born, undocumented workers, Robertson said. Undocumented workers are used to getting paid around $18 an hour to pick strawberries\u2014the type of wage American citizens can get working at an ice cream shop.\u00a0<\/p>\n You would have to pay American citizens \u201c$25 to $30 an hour\u201d to get them in the fields, Robertson said, an unfeasible cost for most agricultural producers.\u00a0<\/p>\n The shortage is already visible on the ground. In Dover, Fla., Matt Parke of Parkesdale Farms told<\/a> The Daily Adda his family business is leaning heavily on the H-2A visa program\u2014designed<\/a> particularly to support foreign agricultural labor\u2014to fill the gaps.\u00a0\u00a0<\/p>\n Economists, however, say the program is too small and too cumbersome to solve the crisis on its own. Hanson noted while H-2A has expanded in recent years, guest workers still account for \u201ca small fraction of the total\u201d farm labor force.<\/p>\n \u201cIt would have to be much, much larger, in the millions rather than the hundreds of thousands, to meet U.S. demand,\u201d Hanson said.\u00a0<\/p>\n The visas also expire each season, requiring repeated applications, housing, and transportation costs for every worker.\u00a0<\/p>\n \u201cIf you want to hire that same worker five years in a row, you have to get five different visas,\u201d Hanson added.<\/p>\n Robertson agreed, but thought the Trump administration could easily expand the H-2A program dramatically to meet the capacity, especially given the innovations of facial recognition technology and other security measures.<\/p>\n \u201cIt blows my mind that they don\u2019t do this,\u201d Robertson said.\u00a0<\/p>\n Tariffs creating a double bind<\/p>\n Imports, once a fallback when U.S. crops ran short, can no longer offer relief. Mexico has a structural advantage in crops like avocados and tomatoes\u2014growing the crops year-round\u2014but Trump\u2019s tariffs have made them more expensive by default.<\/p>\n \u201cMexico produces way more avocados than we do,\u201d Hanson said. \u201cIt\u2019s not like you can plant new avocado trees and get an additional crop next year.\u201d<\/p>\n Hanson also said\u00a0shoppers will feel the tariffs in about six months.<\/p>\n \u201cConsumers are not going to see the full pass-through of the tariffs to product prices, but they\u2019re likely to see at least 50%.\u201d<\/p>\n For consumers, the double bind of deportations and tariffs could soon reshape grocery shopping. Economists warn produce and dairy are most exposed, and many families will be forced to trade down to cheaper, processed foods.<\/p>\n \u201cAs vegetables [prices] keep going up and up, people will just substitute towards these very hot, ultra-processed foods, which ultimately will have adverse effects on their health,\u201d Robertson said.<\/p>\n The only thing policymakers could do, in Hanson\u2019s mind, is encourage \u201clower tariffs.\u201d<\/p>\n \u201cIt\u2019s simple,\u201d Hanson said. \u201cIf we were able to create larger flows of legal farmworkers and lower tariffs, consumers are going to be better off. Any other policy that tries to undo the damages of an existing policy makes no sense.\u201d<\/p>\n These fights aren\u2019t new, he said. Tariffs and immigration are topics the U.S. has had periodic political battles about since the 1950s, and today\u2019s environment is a \u201cvery intense manifestation\u201d of those conflicts. But history shows that once prices spike, voters force lawmakers\u2019 hands. Now, Trump is pressuring Congress to maintain a hard line on immigration. But then you get closer to midterm elections, and consumers are lashing out against higher prices, and your hard line begins to weaken, he explained.<\/p>\n \u201cThat\u2019s just kind of how politics work,\u201d Hanson said.<\/p>\n","protected":false},"excerpt":{"rendered":"Milk prices jumping from $7 to $14, strawberries that feel like luxury goods, and a switch to processed…\n","protected":false},"author":2,"featured_media":117818,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36],"tags":[28,10162,12,101,2538,25138,790,2402,1052,5948],"class_list":{"0":"post-117817","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-deportation","10":"tag-donald-trump","11":"tag-economy","12":"tag-food-and-drink","13":"tag-grocery","14":"tag-immigration","15":"tag-inflation","16":"tag-prices","17":"tag-tariffs-and-trade"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/117817","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=117817"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/117817\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/117818"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=117817"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=117817"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=117817"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}