Meatpacking company survived and thrived after major immigration raid

A report from Center for Immigration Studies:

WASHINGTON (March 19, 2009)—On December 12, 2006, Immigration and Customs Enforcement personnel raided six meatpacking plants owned by Swift & Co. in the largest immigration enforcement action in U.S. history. The plants are located in Iowa, Minnesota, Nebraska, Texas, Colorado, and Utah. A new report from the Center for Immigration Studies examines the raids and their aftermath. It notes the historical context of an industry whose workers have seen a dramatic decline in wages over the past 30 years as well as the raids’ economic effects. The report also discusses both positive and negative reactions in these six communities.

The report, entitled, “The 2006 Swift Raids: Assessing the Impact of Immigration Enforcement Actions at Six Facilities,” is authored by Jerry Kammer, a Senior Research Fellow at the Center for Immigration Studies. Before joining CIS, Kammer was a reporter with Copley New Service, where he won a Pulitzer Prize in 2006. In 1990 he received a Robert F. Kennedy Journalism Award for his reporting on conditions of maquiladora factory workers in Mexico.

The report is available online at http://cis.org/2006SwiftRaids. Some of the findings include:

• As is the case in the entire industry, work at the six Swift plants is characterized by difficult and dangerous conditions.

• Like the rest of the industry, workers at these facilities have seen a steady decline in their standard of living. Government data show that the average wages of meatpackers in 2007 were 45 percent lower than in 1980, adjusted for inflation.

• We estimate that 23 percent of Swift’s production workers were illegal immigrants.

• All facilities resumed production on the same day as the raids. All returned to full production within five months. This is an indication that the plants could operate at full capacity without the presence of illegal workers.

• There is good evidence that after the raids the number of native-born workers increased significantly. But Swift would not provide information on how its workforce has changed. Swift also has recruited a large number of refugees who are legal immigrants.

• At the four facilities for which we were able to obtain information, wages and bonuses rose on average 8 percent with the departure of illegal immigrants.

• There is a widespread perception among union officials, workers, and others in these communities that if pay and working conditions were improved, it would be dramatically easier to recruit legal workers (immigrant and native).

• Worker pay has a small impact on consumer prices. Research by the USDA and others indicates that wages and benefits for production workers account for only 7 to 9 percent of retail meat prices. This means that if wages and benefits were increased by one-third, consumer prices would rise by 3 percent at most.

• Research by the United Food and Commercial Workers union indicates that pay to production workers accounts for only about 4 percent of consumer costs. If that is correct, a 50 percent increase in wages would cause only a 2 percent increase in consumer prices.

• Turnover is high at all Swift plants, ranging from 40 to 70 percent per year. Swift accepts high turnover as a cost of pursuing a business model that emphasizes high-volume production. It spends heavily to replace workers rather than seeking to retain workers by slowing production.

• High turnover imposes severe stress on local communities and social service agencies. It makes transience and upheaval a constant problem for the communities. Many residents resent the price their community pays to have the Swift plant as a large part of their local economy.

• Swift has tried to reduce the employment of illegal immigrants with more rigorous checks of documents presented by new workers. Several months before the raids, the company contracted with the Tucson-based Border Management Strategies for advice on hiring practices.

• In addition to pay increases, Swift introduced a number of methods to attract workers after the raids. The company paid bonuses to new employees, and to current employees who recruited others. It also advertised heavily, paid relocation expenses, and provided daily transportation from distant population centers.

• Reaction to the raids varied widely within these communities. Many members of the communities were enthusiastically supportive of the enforcement action, while others were sharply critical.

• The Swift plants in Marshalltown, Iowa, and Hyrum, Utah, illustrate the immigration connections that were established during the 1942-1964 era of the braceros and extended through the 1986 amnesty. Many relatives and neighbors of former braceros now work at Swift plants.

Posted by Lawrence Auster at May 10, 2009 11:30 PM | Send