Agri Jobs Shift Off Farms

Fewer Arkansas farmers feed more people than ever before.

On-farm production jobs in Arkansas were down 20 percent from 84,000 in 1981 to 67,000 in 1997. Although that’s the last year for which the U.S. Department of Agriculture has numbers available, because of changes in the way certain jobs are tracked, there is great confidence among academicians that the trend has continued.

During the same 17-year span nationally, on-farm production jobs are down 18 percent from 3.8 million in 1981 to 3.1 million five years ago.

But another segment farther along the agriculture job chain has seen an explosion in employment. Agriculture wholesale and retail trade jobs in Arkansas were up 59 percent from 79,000 in 1981 to 126,000 in 1997. Critics say the number is misleading because the USDA lumps everything from meat wholesalers to grocery store and fast food clerks into that category.

That makes the segment more dependent on population growth and urbanization than farm growth.

But Bruce Dixon, an agricultural economics and economics professor at the University of Arkansas, said the numbers are simply the result of a shift in American eating habits. Once-needed farm production jobs have given way to processing and retail positions.

“The seismic change in food consumption patterns over the last century is women have gone to work.” said Dixon, who has a joint appointment in the UA’s Walton College of Business and Bumpers College of Agriculture, Food & Life Sciences.

“As a consequence, the demand for further processed, easy-to-prepare food has increased.”

Agriculture wholesale and retail trade jobs are the main reason Arkansas’ total farm and farm-related employment figures were up overall. Total agri jobs increased 22 percent from 239,000 in 1981 to 292,000 in 1997.

Nationwide, agri jobs totaled 22.9 million in 1997 or about 15 percent of U.S. employment, said Alan Majchrowicz who is an agricultural economist for the USDA in Washington, D.C.

“When you look at the national picture, it’s the same as in Arkansas,” Majchrowicz said. “If you need less people to physically produce the same product, you’re not going to have as much labor. Farming is simply less labor intensive than it used to be, and food sales and service is more so.”

Agriculture processing jobs in Arkansas increased 29 percent from 55,000 in 1981 to 71,000 in 1997. Dixon said that figure is probably even higher today with the proliferation of Arkansas poultry producers such as Tyson Foods Inc. of Springdale, which employs 24,500 people statewide.

The Arkansas Employment Security Division does not track farm and farm-related employment. But by adding that agency’s total non-farm jobs from 1981 and 1997 to the USDA’s total farming employment figures a loose comparison can be made.

That would have given Arkansas about 979,000 jobs in 1981, of which the agri industry would have comprised 24 percent. In 1997, Arkansas would have had 1.39 million jobs, including 21 percent that were agri-related.

According to UA research, Arkansas now ranks No. 5 nationally with 20.7 percent of its total employment in farm and farm-related jobs. The state is No. 2 for agri processing and marketing jobs with 5 percent of the total state employment.

Green Acres

Doug Rundle, deputy state staticision for the Arkansas Agricultural Statistical Service in Little Rock, said although the on-farm segment is down the number of acres being farmed has not declined much.

There were 15 million acres of Arkansas farm land in 1995. As of the 2000 U.S. Bureau of the Census report, there were 14.6 million.

“There’s still a lot of farming going on in Arkansas, it just takes less people to do it,” Rundle said. “The soil in Arkansas is still great crop land. It’s just that many farms have been consolidated, and there have been some conservation efforts that put some of the marginal land back into wetlands.”

Urban sprawl is the main culprit. Most of Arkansas’ cities have spread out into land that as recently as 20 years ago was used for farming.

Rundle said Arkansas is still farming more than 6 million acres of rice, cotton, soybeans, grain, sorghum, corn and winter wheat. There are 48,000 farms statewide, mostly small 10- to 15-acre chicken, cattle and hog operations. Only about 6,000 farms grow row crops from the “ice cream” rich soil of the Arkansas Delta to the Arkansas River Valley.

“Better equipment and growing techniques, financial distress and of course urban sprawl have all also contributed to the reduction in on-farm jobs,” Rundle said. “There’s no doubt many farmers have left the business, but when they do, most likely someone else is picking up the land. It’s generally not sitting idle.”

In the Red

The efficiency of substituting capital for labor has been a major cause of fewer farm jobs during the last half century. Dixon said the average age of farm operators has also increased, and that better technology have contributed to the decline, too.

Dixon said the agricultural industry experienced a boom in the 1970s. But in 1980, the national recession, rapidly rising land prices, an increase in the value of the dollar and skyrocketing interest rates did farming in.

By 1985, the year Arkansas experienced its largest single year drop in on-farm jobs —a 6 percent fall from 77,000 to 72,000 — Dixon said the nation had hit the bottom of the agricultural bust.

“Jimmy Carter appointed Paul Volker as chairman of the Federal Reserve,” Dixon said. “Volker broke the back of inflation by cutting the money supply and driving up interest rates. That killed cattle and livestock farmers who borrow huge sums of money for operating revenue. The dollar got strong, and U.S. agri products became more expensive overseas.

“Basically, the bottom fell out.”

Unemployment peaked at 9.7 percent in 1982, and 9.6 percent in 1983. During that time, according to President Bush’s February economic report, agri wage rates were about $6.37 for hired workers. By January 2001, that figure had risen to $8.85, helping farmers compete a little better with higher paying service and manufacturing sector jobs.

But hourly manufacturing pay over the same span climbed from $8.49 to $15.11.

Congress has tried to sustain farmers, despite not being able to hammer out the current Farm Bill, by pumping $57 billion into the national farming economy from 1998-2000.

Federal farm subsidies to Arkansas have nearly tripled since 1990, rising from $312,696 to $900,648 by 2000. In 1999 alone, those funds almost doubled, jumping from $472,333 to $815,267.

“I think there’s a number of additional people who would like to be in farming, but they don’t believe they can make a good living at it,” Dixon said. “People like to farm and be self-employed. They are gratified by producing items that people need and feel a kinship with the land.

“But the fact that it’s hard to making a living farming today is a testament to the productivity and dedication of the American farmer and the competitive nature of agriculture nationally and throughout the world.”