California's Minimum Wage Increase Could Hurt Dairy Industry

DT_Rotary_Parlor_Employees
DT_Rotary_Parlor_Employees

California could be facing a new labor challenge after Governor Jerry Brown and state legislators struck a deal on Monday to raise the minimum wage to $15 by 2022. Farm labor availability is already limited in the state, and dairy farmers believe the increased minimum wage will make it even more difficult to hire the workers they need to keep their dairy operations running.

A recent MILK Intelligence national survey of dairy farmers with more than 500 cows found that starting milkers in California were paid an average of $10 per hour. More than 65% of farm owners surveyed provide employees housing as part of their compensation, almost 40% offer insurance and nearly 42% pay production incentive bonuses.

Under the legislation proposed by the governor on Monday, the current minimum wage of $10 per hour would rise to $10.50 in 2017, $11 in 2018, and then increase $1 each year until 2022. The governor retains the right to halt wage increases if the economy can’t sustain them, according to the agreement.

Many dairy farmers who responded to the MILK Intelligence survey expressed many concerns about the push for a higher minimum wage in many states and localities.  “Pushing up the minimum pushes all levels above it to a new floor," said one respondent. "Minimum should be an entry-level wage for beginning wage earners."

“You need to be able to control costs, and I do not believe that we should be mandated to offer more than the position demands or required by skill level," another respondent said. 

Fortunately for the few small dairies left in California, businesses with fewer than 25 employees have an extra year to implement the wage increases.

Governor Brown admits that the wage increase will be tough on some businesses. “If you took the wages down and cut them in half, it would make it easier for certain businesses,” he said in a press conference on Monday. “But you can’t function that way, because we’re a community.”

 

Latest News

February Milk Production Report Shows Lackluster Numbers
February Milk Production Report Shows Lackluster Numbers

Comparing a leap year versus a non-leap year in 2023, February milk production was up 2.4%. However, on a per-day basis, production was down 1.1%. Milk cows totaled 9.3 million head, down 89,000 compared to a year ago.

APHIS Now Thinks Wild Birds Are to Blame for Highly Pathogenic Avian Influenza's Arrival on Four U.S. Dairies
APHIS Now Thinks Wild Birds Are to Blame for Highly Pathogenic Avian Influenza's Arrival on Four U.S. Dairies

The livestock industry continues to grapple with the first confirmed cases of HPAI in cattle, while federal and state agencies continue to assure consumers there's no concern about the safety of the U.S. milk supply.

Success is All in the Details at Kansas Dairy Development
Success is All in the Details at Kansas Dairy Development

Kansas Dairy Development provides temporary housing for up to 80,000 head of cattle — from a few days old to springers nearly ready to calve. Their formula for success is all in the details.

Skills Survey Reveals U.S. Agriculture & Food Industry Workforce Needs and Gaps
Skills Survey Reveals U.S. Agriculture & Food Industry Workforce Needs and Gaps

U.S. employers report challenges in finding suitable job candidates with work-ready skills to fill open roles in ag. The AgCareers.com U.S. Skills Survey offers insights, data and trends to address skill development.

Built Out of Love: How Two Sisters Created a Super-Fast-Growing Yogurt Company
Built Out of Love: How Two Sisters Created a Super-Fast-Growing Yogurt Company

Travel to the rolling hills of Pennsylvania, and you’ll meet Hayley and Stephanie Painter who not only made the Forbes 30 under 30 list, but have also created one of the fastest growing yogurt company in the U.S.

"Boring" Technology Will Reshape Dairy Over the Next 10 Years
"Boring" Technology Will Reshape Dairy Over the Next 10 Years

Once a technology becomes a boring experience it means it has become proven, well-adopted, and easy to utilize. There are three "boring" technologies silently shaping the industry.