Nebraska has a number of prospering industries, but none are so interconnected to the state’s economy and future success as agriculture.
“I can’t foresee a time when Nebraska’s principle industry is not going to be agriculture,” says Eric Thompson, associate professor of economics and director of the Bureau of Business Research at the University of Nebraska – Lincoln. “Ag is a complex cluster of other industries, and together they comprise a huge part of the state economy.”
On average, the agriculture sector contributes $22.6 billion to the state economy each year, which is about 27 percent – or more than a quarter – of Nebraska’s gross state product. It provides around 289,000 jobs comprising 23.6 percent of the state’s workforce. “It’s a diverse industry, so you’re talking about a lot of different kinds of employment opportunities,” Thompson says.
Divisions of Agriculture
Agriculture in Nebraska doesn’t begin and end with the farmer. The industry is made up of many components that contribute to its success and make it a thriving enterprise. Processors, manufacturers, transportation and industry service providers all have a role in the various sectors of agriculture and contribute to the state economy.
“I’d say about five to seven percent of the annual agriculture revenue is from actual ag production,” Thompson says. “But because we have such an abundance of agriculture products in Nebraska – particularly livestock – we have drawn other industries to the state.”
Agriculture service providers include seed and chemical companies, as well as farm equipment sales and repair, among others. Transportation, both trucking and railroad, provides an important service as a distributor of farming supplies and products. Processors include operations that finish crops and livestock into other products, from food, to feed, to fiber, to fuel. This includes food companies, large livestock feed mills, animal health nutrition companies and biofuels.
Agriculture Where You Least Expect It
Greater Omaha Packing Co. processes cattle for markets across the United States and in more than 50 countries. So with about 900 employees, it’s a part of the agricultural industry, even though it is located in the city of Omaha.
“This state thrives due to agriculture,” says Angelo Fili, executive vice president of Greater Omaha Packing. “I believe a vast majority of Nebraskans are in a job that is in some way related to agriculture.”
From careers in railroad, to selling real estate, to purchasing UNL football tickets, many dollars circulating in the state arrive in Nebraska originally as a result of agriculture, Fili says.
“It’s easy for people to think agriculture and just see a farmer or a field of corn,” says Ernie Goss, a Creighton University economist who specializes in agriculture’s influence on the Nebraska economy. “But agriculture is in every single thing that we do. It’s in how we sell our state as a brand, in how we attract new businesses and people to the state, and it’s something we rely on for success here.”
An Unpredictable Industry
In 2010, Eric Thompson and other scholars from the UNL Department of Agricultural Economics put together a study on the economic impact of Nebraska agriculture and its supporting industries for that year. These numbers are still the most accurate gauge of agriculture’s impact on the state in recent years.
“2011 and 2012 were unique years in Nebraska agriculture because they had uncommon conditions,” Thompson says.
In 2011, the world saw a surge in the prices of agriculture products as a result of global conditions. Weather and other factors contributed to less-than-average years across the globe, but Nebraska was different. “All over the world, farmers were having a bad year,” Thompson says. “But in Nebraska, the weather was great, we had high outputs and products had a high value. We had record farm income in some areas.”
In contrast, 2012 brought a considerable drought to the state, and agriculture sectors, particularly livestock, suffered. “It will be interesting to look at the numbers for 2013,” Thompson says. “It will be the first year in the last few that we will really get a look at how agriculture is doing and what we can predict for the coming years.”
The Future of Agriculture in Nebraska
The technology of farming and agriculture is constantly changing and improving, as are the needs and economies of communities around the globe, Thompson says. Nebraska will continue to evolve to meet those needs and that will mean good things for Nebraskans, both urban and rural alike.
“The number of producers in the state may not grow,” he says, “but agriculture will continue to. It will continue to play a critical role in the state and will continue to stay on the cutting edge of developments in order to better serve the world.”
As the world income increases and demands for products like meat grow, Nebraska will be a key player in producing food for an increasing global demand.
“The future of Nebraska is dependent on agriculture,” Fili says. “In my opinion, completely and inseparably.”