The Importance of Agriculture to the United States Economy
March 30th, 2022
Agriculture has historically played a significant role in the United States economy. In today’s digital age of business, it is a sector that sometimes gets overlooked in terms of jobs, financial opportunity, and economic impact. However, the importance of agriculture to the US economy has been rising for years as we recover from a pandemic and redefine what a healthy economy looks like.
We’ll highlight elements of how agriculture remains one of the pillars of our country, including:
- Why agriculture is important to the US economy
- What are the benefits of agriculture to the economy?
- United States agricultural jobs
- US ag economy statistics
- Agricultural lending options
Armed with this information, you’ll be able to decide which portion of the exciting agricultural business sector to focus on for your next opportunity.
Why is Agriculture Important to the US Economy
The United States is among the most dominant and influential agricultural producers in the world. Not only is the domestic market robust for farmers, but the US is the world’s largest exporter of a number of agribusiness products.
This leads to over one trillion dollars of GDP per year for the United States, and agricultural policy has helped shape various trade and energy acts that affect our overall economy each year. The size, shape, and form of farms may have changed over time, but the role of agriculture has always been prominent in the development and sustenance of the powerhouse United States economy.
What Are the Benefits of Agriculture to the Economy?
Agriculture is not only a driver of economic growth for the United States, but it creates a broader market with related industries – meaning its impact is felt in more places than the grocery store and wholesale food supply.
Consider industries like food sales, nutrition research, horticulture, and restaurants. These are all sectors that depend on American agriculture, and without hard working farmers and dependable products, these industries would falter.
Additionally, as the American home and business trends evolve in how we buy, eat, and value food, the leaders in agriculture have to adapt and be agile. Working with new technology, government agencies, and finding emerging markets are all part of the challenge – and opportunity – presented to American farmers and agricultural entrepreneurs.
United States Agricultural Jobs
The classic portrayal of American agriculture is the hard working farmer – and there are still those who embody this vital portion of our work force today. There are also a number of other United States agricultural jobs that include:
- Agricultural scientist
- Agricultural Personnel Management
- Agricultural Researcher
- Forest Fire Management
- Engineering Equipment Operator
- Food scientist
- Nursery/Florist management
These jobs and career opportunities are just some of the fulfilling paths of agricultural work that help the US economy.
United States Agricultural Economy Statistics
The massive size, scope, and importance of agriculture to the United States economy is evident when you look at the underlying statistics. Consider these modern data points about US ag:
- In 2020, nearly 20 million full and part time jobs were related to agriculture. This is over 10 percent of total US employment. Direct on-farm jobs accounted for over 2.6 million jobs, which is almost 1.5 percent of total jobs in the country.
- Food accounted for over 10 percent of US household expenditure in 2020. This is third in total household spending behind housing and transportation.
- Farms and farmlands have decreased in recent years, but farmlands and commercial farms have increased in the highest economic classes. This could indicate that dedicated farming operations are becoming more consolidated to give an economic advantage to entrepreneurs.
- Both 2021 and the projections for 2022 indicate record exports and profits for agriculture and the United States economy. The percentage of the domestic and international market share has also risen for United States farmers in that time.
These numbers are just some of the leading indicators proving that agriculture remains extremely important to our country’s financial health. Even more important, they show that there is room to join the agricultural sector for employment or entrepreneurship in the future.
Agricultural Lending Options
- Farmer Mac Loans: The Federal Agricultural Mortgage Company (FAMC) is also known as Farmer Mac. Since 1980, its role is to create a secondary market for agricultural lending that provides flexible terms and low-cost options for farmers looking to finance a farm, ranch, or agricultural venture.
- FSA Loans: The Farm Service Agency (FSA) provides direct and guaranteed agricultural workers, farmers, and ranchers, including:
- Farm Operating Loans
- Farm Storage Facilities Loans
- Farm Ownership Loans
- Fisheries Finance Program
- Farm Labor Housing
- Agricultural Home Loans: A USDA-backed program, agricultural home loans are common first-time farmer loans. They allow for mixed-use facilities such as cattle ranches or crop development facilities that also house the owner-operators and a staff.
It has never been easier to get funding for an agricultural project, and the economic opportunity remains strong for United States farming. Make sure to work with reputable lenders to create long-standing financial success for you and your business.
Community West Bank is the California Central Coast’s Leader in Ag Lending
At Community West Bank, we work to create financial opportunities for agribusiness in California. Our experienced team has spent decades helping farmers and entrepreneurs start and extend projects that build local and national economic growth.
If you are looking to take the next step to securing funding, please reach out to us today. We work to provide the best agricultural lending programs on the Central Coast. Our team aims to fulfill the financing needs of agricultural and agribusiness clients with Farmer Mac mortgage loans.
For information about available funding for land acquisitions, refinancing, or other lending options for agricultural projects, please contact us to get started. Call Laura Maffei at (209) 679-9244 or (805) 692-4394.