The Census of Agriculture, conducted in years ending in 2 and 7, reported that there were 2.1 million U.S. farms with farm sales of $395 billion in 2012, including $212 billion in crop sales (54 percent) and $182 billion in livestock sales (46 percent). In almost all previous COAs, livestock sales slightly exceeded crop sales, but a combination of high crop prices and a drought that encouraged some livestock operators to sell cattle to avoid high feed costs made crops the majority of farm sales in 2012.
Farm sales have been rising by about $100 billion between the five-year COAs; they were about $200 billion in 2002 and almost $300 billion in 2007. However, most farm sales are from a relative handful of large farms. The 81,600 U.S. farms that each had farm sales of $1 million or more in 2012 collectively had farm sales of $264 billion, two-thirds of total farm sales of $395 billion.
The COA reported 2.1 million U.S. farms in 2012, down from 2.2 million in 2007. Farmers are aging; their average age was 58 in 2012, up from 57 in 2007. There are twice as many farmers age 75 and above, 258,000, as under 35, 120,000. Of the 2.1 million farm operators in 2012, 1.1 million had a primary occupation other than farming.
The COA asks farm employers about their expenditures for farm labor in Section 25 of the questionnaire. Question 10a asks about expenditures for workers hired directly, including wages and employer payroll taxes for social security, workers compensation, and any other mandatory or voluntary benefits for farm workers and office staff and salaried corporate officers. Question 10b asks about the cost of contract labor, including wages received by workers, the cost of payroll taxes and benefits to workers, and contractor business expenses and profits.
Some 566,000 U.S. farms reported $27 billion in hired labor expenses in 2012, making hired farm labor 8.2 percent of farm production expenses. Some 217,000 farms reported $6.5 billion in contract labor expenses, two percent of total farm production costs.
In California, 33,950 farms reported $5.9 billion in hired labor expenses in 2012, 16.6 percent of farm production expenses and up 18 percent since 2007. Some 25,100 farms reported $3.4 billion in contract labor expenses, 9.5 percent of total farm production costs and up 48 percent since 2007.
Most farm labor and contract labor expenses are paid by relatively few farms. The 44,200 farms that each paid $100,000 or more for hired labor accounted for 74 percent of the $27 billion in direct-hire farm labor expenses, and the 15,800 that each had $50,000 or more in contract labor expenses accounted for 78 percent of the $6.5 billion in such expenses.
In California, the 7,600 farms that each paid $100,000 or more for hired labor accounted for 92 percent of the $5.9 billion in direct-hire farm labor expenses, and the 6,300 that each had $50,000 or more in contract labor expenses accounted for 94 percent of the $3.4 billion in such expenses.
Most farm workers are employed on farms that produce so-called FVH commodities. These include fruits, nuts, and berries (NAICS 1113) worth $25.6 billion in 2012, vegetables, potatoes and melons (NAICS 1112) worth $16.8 billion, and horticultural specialties (NAICS 1114) such as greenhouse and nursery crops, $14.8 billion.
U.S. FVH sales were $57.2 billion in 2012, up from $50 billion in 2007, with most of the 2007-12 increase in fruits, nuts, and berries. The COA reported 93,000 fruit, nut, and berry farmers, including 4,200 that each had sales of $1 million or more in 2012; 43,000 vegetable farmers, including 2,500 with sales of $1 million or more; and 52,800 horticultural specialty farms, including 2,500 with sales of $1 million or more.
There were 35,900 fruit and tree nut farms in California with sales of $17.6 billion, 6,000 California vegetable and melon farms with almost a million acres of land used for vegetables (some of this land produced two crops), and 3,400 horticultural specialty farms in California with sales of $2.5 billion.
The COA reports hired and contract labor expenses of farms by the NAICS code or primary commodity of the responding farm. FVH farms were 14 percent of U.S. farms with direct-hire labor expenses in 2012, but they accounted for 39 percent of labor expenses. Almost half of all U.S. farms that had labor expenses of $250,000 or more were FVH farms, but the COA does not publish the labor expenses of these large FVH farm employers, so their share of farm labor expenses is unknown.
The contract labor picture is similar. FVH farms throughout the U.S. were 21 percent of farms with contract expenses, accounted for two-thirds of contract labor expenses, and were 56 percent of farms with over $50,000 in contract labor expenses in 2012.
Labor expenses are even more concentrated on FVH farms in California. Two-thirds of California farms with labor expenses, and 57 percent of California farms that had labor expenses of $250,000 or more, produced FVH commodities. FVH farms accounted for 76 percent of labor expenses for workers hired directly by farmers.
FVH farms were 80 percent of those with contract labor expenses, and they accounted for 93 percent of contract labor expenses. Over 85 percent of farms with more than $50,000 in contract labor expenses produced FVH commodities. The share of contract to total farm labor expenses averaged 41 percent for FVH farms, ranging from eight percent for greenhouse and nurseries to about 45 percent for fruits and vegetables.
This post was an excerpt of the most recent Rural Migration News published in July 2014.
Rural Migration News summarizes the most important migration-related issues affecting agriculture and rural America. Topics are grouped by category: Rural America, Farm Workers, Immigration, Other and Resources.
There are two editions of Rural Migration News. The paper edition has about 10,000 words and the email version about 20,000 words.
The paper edition is available by mail for $30 domestic and $50 foreign for one year and $55 and $95 for a two-year subscription. Make checks payable to Migration Dialogue and send to: Philip Martin, Department of Ag and Resource Economics, University of California, Davis, California 95616 USA.