A recent survey by the Minneapolis Federal Reserve has cast a spotlight on a pressing issue facing the agricultural sector: labour shortages. This survey, engaging with agricultural bankers across the ninth district, which includes Minnesota, Montana, North Dakota, South Dakota, and Wisconsin, paints a picture of growing concern. A significant 63% of the respondents flagged labour availability as a major challenge, while the rest acknowledged it as a minor yet notable concern.
Bankers, particularly those based in Minnesota, have voiced their struggles in securing adequate labour for agricultural operations. The survey underscores a stark contrast in the availability of workers, with livestock workers being harder to come by than those in crop production. Moreover, the challenge intensifies when seeking long-term help, a reflection of the agricultural industry’s inherent seasonality.
Looking back over the past five years, the situation appears to have deteriorated. About 39% of those surveyed believe that labour availability has markedly worsened, and 44% perceive a slight decline in the situation.
The Minneapolis Fed attributes this growing challenge to a couple of key regional factors. One is the relatively low influx of migrant workers in the area, a trend supported by U.S. Census Bureau data.
This data reveals that only 10% of animal production employees in the district are foreign-born, compared to a national average of 18%. The disparity is even more pronounced in crop production, with a mere 5% of workers being foreign-born against a 32% national average.
Another factor is the region’s notably low unemployment rates, coupled with an ageing workforce. The median age of workers in this sector has risen from 51 to 56 in 2021. Over the last decade, there’s been a decline in the workforce aged 45 to 54, although there has been a slight uptick in those aged 25 to 44 and a more substantial increase in workers over 55.
This survey from the Minneapolis Fed brings into focus the labour challenges that the agricultural sector is grappling with, underscoring the need for effective strategies to tackle the issue of labour shortages and their impact on the industry.
