Committee on Economic Security (CES)

Volume VI. Social Insurance

I. Security for Agricultural Workers


Natalie F. Jaros

Natalie F. Jaros
November 1934


The question of the protection of agricultural workers by unemployment insurance has become increasingly important since the war because of the general rise of agricultural unemployment. Formerly, agriculture was characterized by a very moderate amount of unemployment, the most serious forms being occasional unemployment, usually local in its nature and owing to the failure of a main crop, and seasonal unemployment which is a permanent feature of the agricultural industry, caused by the alternations in the seasons. An unimportant degree of employment in agriculture rose from cyclical depressions and there was a certain amount of permanent under-employment in agriculture due to excessive population on the land or to under-development of the soil itself.

Today new economic factors affect the situation in agriculture. There has been a general and rapid spread of mechanization in this industry such that the saving effected by machinery is sometimes as much as 75 percent. Second, agriculture has been undergoing a depression to hitherto unknown intensity. The International Labour Office reports that there are only a few countries in which unemployment in agriculture is insignificant, chiefly France and Austria. Finally, agriculture suffers from the unemployment prevailing in industry. Whereas formerly it was possible for the surplus agricultural population to drain off into industrial employment in urban communities, the depression has stopped up this outlet. The trend is actually now in the opposite direction; unemployed city workers are returning to the land although in states with unemployment insurance they do so as a last resort. The serious situation prevailing in agriculture is unquestionably due to the general causes of unemployment in present-day industry and it is, therefore, becoming more evident that agricultural workers should, as a right, benefit from whatever provisions against unemployment are available for industrial workers.

Generally speaking, the inclusion of agricultural workers until recently was opposed by the employers and not pressed by the workers. It seemed clear that the need for protection, in agriculture was less than in industry. Compulsory schemes, therefore, for the most part, omit provision for agricultural laborers. Great Britain and the Irish Free State do not include them. The German system at first allowed insurance for certain workers in agriculture but recent economy measures have led to their removal. Italy also extended insurance rights to farm workers in the early days of its system but these workers have been dropped because of technical difficulties and because unemployment in the industry was regarded as a purely temporary phenomenon. The compulsory systems of Austria, Bulgaria and Poland exclude agricultural laborers, as does also the Wisconsin law in the United States. Queensland is the only state with a compulsory scheme which includes them. In Swiss cantons with compulsory schemes agricultural workers are protected insofar as they belong to workers' organizations carrying insurance measures. The voluntary unemployment insurance schemes which exist in Belgium, Czechoslovakia, Denmark, Finland, France the Netherlands, Norway, and in half the Swiss cantons cover workers in Agriculture who are members of workers' organizations providing insurance protection.

In view of the increased unemployment and insecurity of agricultural workers, and in view of the growth of opinion favoring agricultural insurance on the part of both employers and employees, the Royal Commission of Great Britain was of the opinion that insurance should be extended to cover such workers. But it was agreed that the low average level of wages to agricultural workers would make impossible their being subject to the same rates of contributions and benefit as industrial workers. The problem to be solved, accordingly, is whether or not a special scheme be set up for agriculture. The two major difficulties in Great Britain relate to estimating the average rate of unemployment in the industry and devising an effective method of administration. Since agriculture is in large part carried on in units employing two or three workers, and in sections which are remote from an employment exchange, it is obvious that new agencies would have to be created to do the administrative work. The Royal Commission, while favoring protection for farm workers, recommend that they be covered by a special scheme and that the necessary elements for such a scheme be considered.

There is no doubt that unemployment insurance would give the farm laborer in Great Britain a greater sense of independence than he now enjoys. It would on the whole make agriculture more attractive, especially to the younger people in it, who now resent not having the security of income which industrial workers are allowed. The Royal Commission reported that in the year ending April, 1931, 25,000 farm workers, left agriculture to go into insured occupations, more than half of whom were young men under twenty-five years of age. The Report also pointed out that persons insured in industry resisted taking temporary employment in agriculture for fear of losing their right to insurance as workers in industry. Finally, the low wages of the farm laborer, which do not allow for saving during employment, make protection against unemployment especially necessary. It was pointed out by the British Minister of Labor in 1930 that an effort must be made "to break down the wall of separation between workers in industry and workers in agriculture" because "whether we like it or no, there will have to be an interchange of labor between the towns and the country side."

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