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Benefits Matter When Ag Workers Lose Their Job

You’ve recently lost your job and you don’t have unemployment insurance. What do you do?

In many cases, you probably take the first job you can get, even though it’s not the right fit and most likely pays less than what your peers are earning.

Similarly, a new study from Dr. Ivan Kandilov in NC State’s agricultural and resource economics department shows that benefits matter when agricultural workers lose their jobs. He finds that workers displaced from farms that don’t offer unemployment insurance re-enter the workforce about a month earlier than manufacturing workers or agricultural workers with unemployment insurance.

A good thing, you say? Not necessarily – the workers rushing back into the workforce earn 9 percent less than their peers who have benefits.

Kandilov says unemployment benefits allow workers to take their time during job searches and find a better job match – which usually comes with better wages.

Kandilov adds that the study, published in the American Journal of Agricultural Economics, showed similar results when both Hispanic workers and seasonal workers were excluded from the data, suggesting that the differences in unemployment insurance are the drivers behind the results, not seasonality or differences in legal status.