The table below shows the total of monthly agricultural employment (both direct farm employment and agricultural labor contractors) across the 8 counties classified as the San Joaquin Valley. The decline in employment exceeded 2% in each of the last 3 months of the year, in contrast to increases at the beginning of the year. The annual monthly average shows a loss of 513 jobs, or -0.3%, in contrast to earlier estimates of a modest gain. When this recent trend is combined with larger water shortages in 2015, it suggests that a significant decrease in agricultural employment should be expected this year.
While agricultural employment now appears to have decreased slightly in 2014, the following should be noted:
- Farm employment in the Valley remained near an all-time high.
- Even in the 4th (worst) quarter, the decline in jobs was less than half the consensus prediction by economists in 2014 (yes, that includes me too)
- Total agricultural wages were up nearly 4% compared to the previous year.
- Overall employment continues to grow in the San Joaquin Valley, and unemployment has declined to single-digits in most of the Valley, and is significantly lower than its historic average in most of the Valley despite the drought.
In contrast, both farm employment and wages decreased 3-4% during a less severe drought in 2009, which was the basis of predictions of greater losses in 2014. The leading explanation for the smaller than expected loss in jobs is the shift to higher value crops, and while that is certainly part of the explanation - that shift was already well underway in 2009.