Aging Farmers, Fewer Farms a Societal Problem

February 9, 2000

The number of farmers 55 years and older continues to increase. But with fewer, larger farms generally producing enough food and fiber to meet domestic and export needs, the unmet need for younger, beginning farmers is a daunting issue for policymakers.

A new study from USDA. s Economic Research Service notes the average age of farmers is 54.3 years and the proportion of farmers age 55 and older has increased from 37% in 1954 to 61% in 1997. The share of farmers younger than 35 years has declined from 15% in 1954 to 8% in 1997.

The "traditional pool of new entrants into farming" . white males in their 20s growing up on family farms . is shrinking from about 700,000 in 1990 to "perhaps" 365,000 today, the study says. "This shrinkage is attributable both to the decline in farm numbers and to the fact that farm families have fewer children than in the past," the study adds.

Young (under 40) commercial farmers whose primary occupation is farming can be divided into those who entered with capital, usually inherited from family, and those who did not. Young commercial farmers with more than $150,000 in net worth operate about 5% of all farms and are less likely to display financial stress than with fewer resources. These farmers are more likely to use commercial rather than subsidized credit.

In contrast, young, low-resource farmers, who operate about 2% of all farms, either must borrow more or find other sources of equity. "There appear to be considerably fewer young, low-resource farmers than young established farmers, suggesting the importance of the capital requirement as a barrier to entry into farming," says the report.

"The net result of entry and exit into the farm sector over decades has been fewer farmers," the report continues. "Increases in labor productivity, however, have been rapid enough to maintain farm output even in the face of fairly strong declines in the number of farmers. As a result, changes in the age composition of the farm population or in its overall size have not and will not likely have adverse implications for the nation. s food security.

"However, these shifts may raise concerns about the structure of farming and the concentration of agricultural production."

The study is available on the Internet at http://www.econ.ag.gov/whatsnew/issues/beginning/index.htm