An Ag Economist says the raids this week by federal immigration officials at a Swift and Company meatpacking plant are likely to drive up the cost of doing business for the beef industry, pushing packers to look for other ways to cut operating costs.
Matt Stockdan says Swift, and possibly other companies in the industry, will have to spend more to make sure employees are legal, and they’ll all face the prospect of more plant shutdowns or reductions in the labor force from any future raids. Stockdan says the impact will likely mean both higher retail beef costs and lower prices for farmers producing cattle.
They have to cut costs somewhere else, the economist says, in production or in hiring people somehow to make up for it, which is one possibility. But more than likely, it will probably be passed on to their input costs where they?re trying to buy products maybe a little cheaper, as well as the fact that they?ll try to pass some of that on to the consumer.
“So,” Stockdan says, “it goes both directions.” The greater the industry perceives the threat of more raids, Stockdan says, the more companies will be willing to spend on background checks or hiring consulting firms to make sure employees are legal. And Stockdan says those costs will be passed on.
Stockdan says every time a crackdown is contemplated, we need to think about the costs. It’s not just a matter of closing the international border, he says, as we need to look at the real benefits, and the real costs. Stockdan says he thinks some packing companies may have a hard time finding American workers willing to take the jobs formerly held by immigrant laborers