Contribution of Agriculture to the Wisconsin Economy

This new report provides an update on the Contribution of Agriculture to the Wisconsin Economy by Steven Deller using data from the 2017 Ag Census, the most current available. Despite currently weak commodity prices, particularly within dairy, agriculture remains an important part of the Wisconsin economy.

Compared to the last analysis, which explored data for 2012, the economic contribution of agriculture has increased across all four measures of economic activity. On-farm activity, however, was not a major contributor to this increase and is likely a reflection of weak commodity prices in 2017. The majority of the increase in the contribution of agriculture came through recent strong growth in food processing. The challenge facing Wisconsin agriculture is that on-farm activity and food processing are “two sides to the same coin” and as one does better the other does better. The continued weak net farm income may put the food processing industry at risk. There is a clear balancing act between ensuring a healthy farm economy while continuing to promote growth in food processing.

 

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At a Glance

• In 2017, all of agriculture contributed $104.8 billion to industrial sales (revenues), up from $88.3 billion in 2012, 437,700 jobs, an increase of about 24,000 jobs from 2012,

• On-farm activity contributes $22.0 billion to industrial sales or revenue (3.5% of the state total), 154,000 jobs (4.1%), $5.8 billion to labor income (2.9%), and $9.8 billion to total income(3.0%).

• Food processing activity contributes $82.7 billion to industrial sales (13.0% of the state total), 282,000 jobs (7.6%), $22.5 billion to labor income (8.4%), and $37.6 billion to total income(8.6%).

• Dairy, combining both on-farm and dairy processing, contributes $45.6 billion to industrial revenues (7.1% of the state total), 157,100 jobs (4.2%), $9.0 billion to labor income (4.5%) and $15.1 billion to total income (4.7%). Dairy processing accounts for roughly two-thirds of this contribution.

• The economic activity supported by agriculture results in state and local government tax revenues of $2.9 billion, which is roughly 7.4% of “own source revenues”.

• The bulk of the growth in the contribution of agriculture to the Wisconsin economy between 2012 and 2017 is growth in the food processing sectors.

• Foreign exports of agricultural products (on-farm and processing) accounts for $4.9 billion in industry revenue (0.8% of Wisconsin total), 21,539 jobs (0.6%), about $1.1 billion in labor income (0.5%) and $1.8 billion in total income (0.6%). Additionally the economic activity generated by agricultural foreign exports creates $129.7 million in state and local tax revenues.

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