Dairy Wage Survey 2009

Gregorio Billikopf
University of California

It was up to each dairy farmer to pick one milker, and give us the number of years the person has been employed. Average milker wages were $9.95 (2009), $9.69 (2006), $9.25 (2003) and $9.26 (2000). Keep in mind that each dairy chose one worker to report on. In general we see a relationship with higher wages for milkers who have worked the longest at the dairy. I have hypothesized that 1) the number of foreign-born milkers will increase through time, especially as Mexican and Central American workers move into regions where they were not utilized in the past: and 2) that as foreign born milkers increase, the number of USA-born female milkers is likely to decrease. The average percentage of foreign-born milkers was essentially the same in the 2009 survey (66%) and the 2006 survey (69%). Given issues of sampling, it is best not to draw too many conclusions as to these numbers.

Forty-seven percent of the dairy farmers offered some type of incentive or bonus pay in 2009 (in contrast to 36.5% in 2006). Bonuses may include any sort of benefit, such as beef, money, or time off, which is not directly related to an individual’s work efforts. Incentives, on the other hand, are tied directly to worker performance. In these times of such economic stress, a well designed incentive pay program can be of great benefit to dairy farmers and their employees. A well designed incentive—such as pay tied to lowered somatic cell counts or increased calf health—means employees only get an incentive if they have helped to increase the profitability of the dairy.

A fourth of the employees (2009) received some sort of health insurance, down from a third who received health insurance in 2006. The average cost for this insurance for the dairy producer was $341/month in 2009 vs. $377 in 2006. Sixty-three percent of the dairy producers provided paid vacation to their milkers. These milkers earned an average of 9 days of vacation in 2009, compared to 10 days in 2006. A few dairymen also offered additional pay in lieu of vacation. Forty percent (2009) of the dairies supplied milkers with housing or a housing allowance. In 2006, half of the dairies reported providing this benefit. The housing allowance averaged $239 per month. Seventeen percent paid a shift differential for more difficult shifts. Eighteen percent (2009) of the dairy producers offered a 401k or some sort of retirement plan for their employees.

As in previous surveys, some dairy farmers did not know where a replacement worker might come from while others had no problem in recruiting. One dairy producer explained that potential employees showed up without any need for recruitment. Much can be said about building a reputation for being a solid employer. Pay is normally a very important factor in attracting and retaining employees, but interestingly, a dairy with no labor supply needs was paying only a dollar more ($11, Kansas) than a couple of dairies who had trouble finding employees ($10, Washington, Ohio). With the growing uncertainty regarding labor supply in the future, there are important steps that dairy farmers can take that will help them attract and retain productive employees.

For the complete survey results, visit http://www.cnr.berkeley.edu/ucce50/ag-labor/7research/7res08.htm