Socio-Economic Impact of Nursery Automation

The nursery and greenhouse industry is often described as one of the fastest-growing sectors of U.S. agriculture and is inherently labor intensive. In order to sustain robust growth in the industry, continuous improvements in the skills of the workforce and their year-round availability are necessary. These workers perform varied functions and are subjected to different working conditions. Many jobs in the industry require large amounts of stooping, lifting of heavy containers, and exposure to chemicals, dust, and plant materials. These tend to be relatively-low paying jobs making it difficult for managers to compete for and retain workers in currently tight domestic labor markets. Many commercial operations have employed immigrant labor, which is mostly less skilled, to meet their rising labor requirements. In the long-run, there is a need to increase the skill level of these migrant workers in order to improve wage rates, recruitment, and retention of workers.

A socioeconomic survey of nursery and greenhouse automation and mechanization was conducted as part of a research program undertaken by the Mississippi Agricultural and Forestry Experiment Station and the U.S. Department of Labor entitled “Enhancing Labor Performance of the Green Industry in the Gulf South.” The 10-page socioeconomic survey consists of eight parts, namely: workers’ demographic characteristics, nursery characteristics, nursery mechanization, greenhouse automation, labor and capital markets, pesticide and chemicals, working conditions, and respondents’ characteristics. The overall goals of the regional socioeconomic survey are to develop a socioeconomic profile of horticulture workers and to evaluate the impact of automation on their employment, earnings, safety, skill-levels, and retention rates.

Using results of the completed survey of nurseries and greenhouses in the northern Gulf of Mexico states, Tobit regression analysis was used to estimate empirical models to measure the socioeconomic impact of automation or mechanization on annual gross sales, annual employment, and workers’ earnings, safety and retention. The survey was conducted among 87 randomly selected nurseries and greenhouses located in Mississippi, Louisiana, and Alabama from Dec. 2003 to Mar. 2005. About 20% of all the identified major tasks were performed by workers in nurseries and greenhouses with some form of mechanization or automation. Regression results showed that nurseries and greenhouses that experienced higher levels of sales also demonstrated higher levels of automation or mechanization. The employment impact of automation or mechanization was neutral indicating that any improvement in automation or mechanization did not necessarily lead to a reduction but instead to a more efficient use of labor by nurseries and greenhouses. Improvements in automation or mechanization resulted in higher total workers’ earnings reported by participating nurseries and greenhouses. Further Tobit regression results showed that automation or mechanization had neutral effects on the length of training period, workers’ safety and retention rates and enabled nurseries and greenhouses to hire less-skilled workers.

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For further information, contact: Dr. Ben Posadas, Associate R/E Professor of Economics, CV