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News / Business

Employers across Texas rely on guest worker programs amid labor shortages

By Arcelia Martin and Alfredo Corchado, Arcelia Martin and Alfredo Corchado, The Dallas Morning News
Published: July 16, 2023, 6:19am
3 Photos
Luciano Gomez delivers a tray full drinks to patrons sitting outside at Las Almas Rotas in the Fair Park neighborhood of Dallas, May 26, 2023.
Luciano Gomez delivers a tray full drinks to patrons sitting outside at Las Almas Rotas in the Fair Park neighborhood of Dallas, May 26, 2023. (Tom Fox/Dallas Morning News/TNS) Photo Gallery

When spring rolls around, Patricia Meier hopes to see familiar faces working on her Burleson, Texas, farm.

She only needs a handful of workers — four ranch hands — to cut hay, reseed and run tractors where she raises horses and sells hay. But to get that work done, she’s had to search beyond the American workforce.

“In the last five years, no U.S. citizens have applied for the job,” Meier said.

To staff the farm, Meier, the owner of M&M Arabian Enterprises, has come to rely on foreign workers through H-2A visas as the family business’ sole employees outside of managers.

The visa program allows American employers to fill employment gaps by temporarily hiring workers from other countries, after proving they can’t find labor in the U.S. The process is expensive, complicated and slow-moving, and opens business owners to a slew of audits that would be less likely if they employed Americans.

“This really is a last resort,” said Anique Watson, vice president of Action Visa Assistance, a Wylie-based agency helping business owners navigate guest worker programs. “No one turns to this program because it’s a cheap and easy way to get labor.”

Texas prides itself in its ability to recruit and retain some of the country’s largest companies and create jobs. The state leads the nation in new positions added, with 51,000 more positions listed in May. But finding workers to fill those spots creates a pressure point between business leaders and elected officials.

The state routinely leads the nation in demand for H-2B visas, the nonagricultural arm of the visa program, that allows employers to hire temporary workers for work such as construction, landscaping and hospitality. Some members of the business community said politicians’ focus on border security and asylum-seekers has diverted attention from immigration reforms that could help meet the demand for labor and, in turn, charge economic growth.

Texas Gov. Greg Abbott has centered his political agenda around immigration. He has formed border patrol units, urged other states to send troops to the Texas-Mexico border and installed large red buoys along part of the Rio Grande.

Yet the governor has seldom discussed immigration in terms of labor despite the state’s leading use of foreign workers. The governor’s press office did not respond to questions about the economic impact of the program.

Immigration is a top-of-mind issue across the state and the country, as Texas’ borderlands have become a stage for politicians to make their positioning clear around immigration. Limitations on guest worker programs only further maintain a stubborn workforce shortage, several business owners across North Texas say, damaging consumers’ experiences, leaving open jobs unfilled and driving up labor costs and inflation.

The shortages extend through the agricultural sector, into hospitality, services, construction and trucking, said Manuel Lievano, CEO of Miami-based MCC USA Global Workforce Solutions, an employment placement agency that recruits international workers for U.S. companies experiencing labor shortages.

“We’re seeing labor shortages from South Beach to Beverly Hills, northern Oklahoma, Dallas, you name it, the shortages are everywhere,” Lievano said.

Difficulty in hiring

“The labor shortage is an important issue in Texas,” said Jesus Cañas, a business economist at the Dallas Federal Reserve.

While a June survey of more than 360 Texas business executives conducted by the Dallas Federal Reserve shows the leaders say they’re in a better position than in September 2020, a third still consider hiring challenges a primary concern.

“It’s still very important for them in terms of their outlook over the next six months, and that goes hand in hand with higher labor costs,” Cañas said.

Across the country, employers added 209,000 jobs in June, a dip from the impressive 339,000 jobs in May, in the latest sign that a booming labor market continues to keep the country from slipping into a recession. It’s also a worrisome signal to businesses that a U.S. labor shortage will only grow without expanded guest worker programs or immigration reform.

“Companies are losing money because they are not growing. And we’re seeing higher costs for consumers,” Lievano said. He questioned why politicians use immigrants as scapegoats. “There is reality, and then there is what politicians talk about. A lot of times, the talk by politicians hurts the economy more than helps it.”

Throughout the last decade, Texas Sen. Ted Cruz has changed his tune on guest worker visas. He previously advocated for an increase in the capped H-1B program, the visa which is intended for workers with special skills in fields such as engineering, science and health care. But Cruz has since argued that foreign workers are an economic threat.

During the pandemic, Cruz and other Republican senators, urged then-President Donald Trump to suspend new guest worker visas for 60 days and others for a year, or until unemployment returned to normal levels.

Immigrant advocacy groups said the request exploited the pandemic to advance the GOP agenda to make temporary restrictions for most types of visas permanent.

Last month, Cruz led other legislators in filing a brief to the Supreme Court against the Optical Training Program, a Department of Homeland Security visa initiative that allows international students to work in the U.S. for up to three years after graduating. The program is often a precursor for H-1B visa hopefuls. Cruz argued the long-standing program is unlawful and creates competition for U.S. workers.

“President Biden’s DHS is circumventing the law Congress has established regarding non-immigration visas and it’s hurting American workers,” Cruz said in a statement. “This is a broken visa program that needs to be fixed.”

The U.S. Chamber of Commerce, the National Association of Manufacturers and the Information Technology Industry Council were among those defending the program to the court.

From 2010 to 2016, East Coast and Texas metropolitan areas were the largest users of the H-1B program. Dallas-Fort Worth trailed only New York City in that time frame, as North Texas firms received 74,000 visas.

The number of H-2A positions requested and approved indicates the scarcity of farm labor, as it shows that U.S. employers have tried and been unable to source American workers, according to a report from the Economic Research Service of the U.S. Department of Agriculture.

Over the past 17 years, the number of H-2A positions requested and approved has increased from 48,000 positions in fiscal 2005 to roughly 371,000 in fiscal 2022. But a certified job doesn’t necessarily mean that a visa will be issued. Between Oct. 3, 2022, and March 31, 2023, Texas employers were certified just under 7,000 temporary farm work visas for foreigners.

In Texas, the minimum an H-2A worker can make is $14.87 an hour. The state’s minimum wage is $7.25.

No certainty of visas

Employers must navigate paperwork with a handful of governmental agencies, such as the Labor Department, state workforce agencies and the U.S. Customs and Immigration Services, often holding up the process if one department gets tied up. While their jobs might get certified, the visa may not get approved, Action Visa Assistance’s Watson said.

In recent years, about 80% of the jobs certified resulted in visas from the State Department. In fiscal 2022, around 300,000 visas were issued.

While H-2B visas — used to temporarily employ foreign workers in industries such as construction, hospitality and janitorial services — technically operate on a random lottery system, the drawing closes when a 66,000-visa cap established in 1990 is hit.

The work permits are divided into two batches by Congress based on business employment start dates. If there were any leftover visas from the first half of the fiscal year, they could roll over to the second half, but not from one fiscal year to another. Sometimes supplemental visas are offered to temporarily address labor shortages. Since 2017, the extra batch has become routine, showcasing a demand beyond the decades-old limit.

Texas requested nearly 23,000 H-2B visas in fiscal 2021, surpassing Florida by more than 8,000. More recently, Texas continues to lead the pack in its use of the program. From Oct. 3, 2022, through March 31, 2023, Texas requested nearly 16,800 work visas, according to the Labor Department.

In a December annual report, the U.S. Customs and Immigration Services said there was an “all-hands-on-deck effort” to address any pending applications ahead of unused visas expiring.

In fiscal 2022, USCIS and the State Department issued all available employment-based immigrant visas, double the pre-pandemic number, according to the report.

“This surge of overtime resources was made possible by congressional appropriations specifically directed for backlog reduction efforts,” the report stated.

Andrew Bray, a senior vice president of the National Association of Landscape Professionals, wishes that the H-2B program operated like the H-2A program, or without a cap.

“It’s unfortunate that at this point,” he said, “Congress still can’t realize that our economy has evolved from the early ′90s and that we desperately need to be able to import additional seasonal workers to help supplement that seasonal need.”

Bray views the guest worker program as too closely tied to the politics surrounding immigration.

“We have been kind of put up between a rock and a hard place,” Bray said. “While the immigration debate continues to boil over, which is unfortunate, guest worker visas like the H-2B program get lumped into that debate, but H-2B programs should be referred to as labor issues, not immigration issues.”

John Connolly, a former deputy assistant director for DHS, and a managing director at a consulting firm, said businesses and the government often deal with varying issues around guest worker programs.

The average company is trying to do the right thing by employing people who are authorized to work in the U.S., and the government has regulations that it needs to enforce, Connolly said. “They’re in two different streams,” he said.

Over the past 20 years, the use of the program followed what was going on in the economy, Watson said. But with COVID-19, the agency has seen an uptick in employers’ reliance on the program.

Financial burden on farmers

When Meier began selling round hay bales from her Burleson farm to private horse owners nearly two decades ago, she charged $20. Now one bale runs for $80. In the same time frame, the fees affiliated with her employing a few immigrant workers have jumped from $600 to $3,200.

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She said the way the system is organized now, it puts the financial burden on farmers.

Meier has developed a relationship with an agent in Monterrey, Mexico, who helps coordinate interviews and find workers. Turnaround time from getting the position approved from the government, to when workers show up at the farm, is about four months, she said.

But if the horse farm can’t get the same workers to come back, it’s usually a cousin or nephew of a previous employee, which works out OK for Meier. She said a major shortcoming of the program is that it doesn’t provide a pathway to citizenship — or consistent workers who know the farm well.

“The government really needs to get away so farmers can work to have permanent workers,” Meier said.

Impact on consumers

Curtis DuBay, chief economist at the U.S. Chamber of Commerce, said the worker shortage not only affects employers and industries, but consumers in several ways.

“There aren’t just enough workers in stores, shops, theaters, restaurants, sporting events, hotels, all those things where they are really reliant on workers,” he said. “The lack of workers impacts the overall experience of consumers. Those experiences aren’t what they otherwise would have been.”

Labor shortages can also cause inflation to go higher as wages rise to attract and retain workers, DuBay said.

In the aftermath of the pandemic, labor shortages have affected employers across industries, DuBay said.

“Everyone is struggling with this, figuring out how to get the workers they need in the long-term,” he said. “It’s going to require a new focus on the education system to help people get the skills they need, and we’re gonna need more immigration.”

“We need more immigration because we need more workers at every skill level … because we have a huge number of job openings at all those businesses,” he said.

Restaurant near Fair Park

On a recent Friday afternoon, Las Almas Rotas, a restaurant near Fair Park, was filled with chatter, laughter and cheers.

Lance Darrow was behind the bar, serving tequilas and mescal, and using talent and creativity to prepare the latest trendy mixed drinks. Servers and bartenders, zig-zagged across the bar, toiling in rhythm, seamlessly.

Asked if there is a labor shortage, the bar director and general manager responded, “Everybody is struggling with labor shortages, here in Dallas and everywhere. It’s a challenge, but fortunately, we’re doing just fine because, in part, of the network and resources of our own staff.”

Most aren’t so lucky. Unfilled jobs are having an effect across the entire spectrum, Bray said. Labor is costing companies more and there’s a scarcity of services, making it harder for companies to attend to their customers.

“For every H-2B worker that comes into America, four to six American jobs are created,” said Bray of the landscapers association.

If an employer is able to secure foreign workers, that company can hire more American staff, Bray said. When labor demands are met, it kicks off a series of investments into the greater economy. For example, an employer will have to purchase new products for the new workers.

Watson makes trips to Washington, D.C., to correct misinformation about how the programs function, she said. She’ll fly in with employers and agents that use the program and meet with representatives to explain the importance of the program and areas of improvement.

A misconception Watson hears repeatedly about both H-2 programs is that they steal American jobs and lower U.S. wages.

“It actually provides a lot of room for growth,” Watson said.

Migrants’ journeys

Meanwhile, border theatrics — floating barriers and DPS troops – don’t always represent the reality of the U.S. economy and its demand for workers. Many migrants use their networks to find jobs outside of Texas.

On her second day in New York City, following her arrival from El Paso, Maria Zambrano landed a job cleaning hotels in Manhattan. She thought of going to the San Antonio area where she had friends, but the East Coast provided better pay.

Originally from Ecuador, Zambrano had spent nearly a month in Ciudad Juárez waiting alongside her husband. She detailed the difficult and violent journey through Mexico.

They rode to the border atop a train to Juárez and arrived two days after a deadly fire at a federal detention building that killed at least 40 migrants. They camped outside the building under a full moon, windy days and thunderous rain, she recalled.

Immigration authorities denied her husband’s claim of credible fear but allowed her in without explanation.

Once in El Paso, she took a bus to New York City, a trip financed by friends in New Jersey. The friends had already arranged a job so Zambrano could pay an estimated $17,000 in fees to the smuggler. Even before she settled in, she was already on a subway to her new job, “like a dream, surreal,” she said.

“I’m thankful to God that I finally made it,” she said, adding she misses her husband and talks to daily via WhatsApp. “But this whole journey has been very confusing. I’m here and my husband is not. But once I crossed, getting a job was so easy. The journey should not have been so difficult. Everyone is looking for workers. They need hardworking people like my husband.”

Anthony Alfredo Peña, from Venezuela, took a similar path to the border. A day after that same fire in Juárez he described the horrifying sight of watching part of the immigration building in flames. He crossed the border and later was put on a bus and ended up in New York City.

Six weeks later, he was on a subway from Queens to Manhattan to work at a pretzel shop, a job he landed even before he arrived, thanks to his cousins who promised their employer they would get more help from Venezuela. He wishes he’d paid the government instead of the smuggler for the opportunity to work in the United States.

“It would have been easier and good for everyone,” he said. “My cousins had already arranged the job. I just showed up a day after I arrived and here I am, on my way to work.”

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