Wage Aggregation Issues Under the Old and New AEWR Methodologies

Apr 08, 2026

By Cesar L. Escalante and Joshua Emmanuel et.al

the U.S. Department of Labor (DOL) issued an Interim Final Rule (IFR) that introduced several modifications in the determination of adverse effect wage rates (AEWRs) applicable to H-2A workers hired by U.S. farmers. The new methodology departs from relying on wage data from the Farm Labor Survey (FLS) and will instead set new AEWRs from wage information collected under the Occupational Employment and Wage Statistics (OEWS) survey of the Bureau of Labor Statistics.

This article pursues the arguments presented in our previous SAT article, which shows discrepancies in domestic-H-2A wage differentials at the national level due to the more aggregated nature of the old AEWRs. The previous BLS-based AEWR setting mechanism was riddled with the aggregation issues pertaining to geography, commodity and job type, and static annual AEWR levels.

The new AEWR setting scheme that H-2A employers are using this year resolves some of these aggregation issues. Specifically, state-level AEWRs are now set using the OEWS survey data, thus resolving issues associated with regional aggregation under the old system. In addition, there will now be two wage tiers for H-2A workers established according to the workers’ skill levels.

Level 1 – Entry Level AEWRs apply to positions with neither formal education nor specialized training requirements; and
Level 2 – Experienced Level AEWRs are set at higher rates “commensurate” to the skills, education, training, and/or experience requirements for such positions.

Finally, an adverse compensation adjustment (downward) is also available for employers that provide housing for their H-2A workers. The adjustment rate is determined as the “equivalent hourly rate based on the weighted statewide average of Fair Market Rents for a four-bedroom housing unit available from the Department of Housing and Urban Development.” (Congressional Research Service, 2025)

The new AEWR methodology’s intention to address wage aggregation issues is noteworthy. However, analysts and industry experts only acknowledge its partial resolution of the old system’s imperfections. Issues concerning how the OEWS survey is conducted and addressing job and commodity wage differentiation still exist. The wage data used in the survey comes from state unemployment insurance (UI) records. Because most farms are not included in those records, the survey mainly captures farm labor contractors and businesses that support agriculture rather than farms themselves. This can bias the results toward states with more labor contractors and may leave out states where farms are exempt from UI reporting.

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