From trucking to teaching, seed or chemical sales, off-farm jobs are nothing new for many agriculture operations. The need for supplemental income seems to be increasing, according to the latest data.
In a December 2022 report from the USDA, the mean household income on a farm was $135,281 in 2021, the highest ever recorded. However, more than $100,000 of that was coming from non-farm sources. Based on averages, less than 25% of a farm’s income came from the farm itself.
“In those record-setting years, nearly 50% of our farmers, ranchers and producers lost money,” U.S. Secretary of Agriculture Tom Vilsack said during an address at Commodity Classic in March. “Another 40% of those make some money, but the majority of the money they make comes from off-farm income.”
Off-farm income is defined by the USDA as wage income, non-farm business earnings, dividends and transfers.
The data does shift when adjusting for farm size. The data sampled is nationwide, which includes many smaller niche operations. The smaller the farm was, the more dependent on off-farm income it was.
For commercial farms, the USDA estimates the number is flipped, with nearly 25% of the household income coming from off-farm incomes, with the median being $57,650.
“Households associated with intermediate farms reported median farm income of -$250,” USDA agricultural economist Christine Whitt said in an email to Iowa Farmer Today. “Residence farms reported median income from farming of -$1,000.”
University of Illinois agricultural economics professor Mark White sees similar numbers, and he said that despite agriculture’s importance in many small town economies, the dependence on additional income streams is growing.
“This income does not just come from spousal jobs,” he said. “Nearly 56% of principal farm operators had a main job off the farm.”
He said one reason people are going toward these additional jobs is for health insurance, which lifts a significant cost burden away from many operations. As of the latest data provided by the USDA, dairy operators often have the highest rate of uninsured family members due to the time demands required on the farm, making them unable to seek out other employment. Other livestock operations such as cattle, hogs and poultry make up some of the other more uninsured groups.
