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Lauver: Agriculture, the sector the recession hasn't touched

Posted on October 11, 2012 at 3:43 PM by Iowa Corn

Article written by Andrew Lauver, andrew.lauver@iowastatedaily.com.  To read the original article, click here.
 

During the last decade, we have seen the U.S. economy move up and down like a roller coaster. The negativity surrounding the current 8.2 percent unemployment rate seems to dominate the media. Nevertheless, even in this decade — where we hear about a recession and a high unemployment rate — there is a yellow brick road leading to a land of plenty, if you search in the right area.

So where should you start searching to find this bright spot?


It is the agricultural sector of our U.S. economy that I’m referring to as the shining star in our country during this so-called recession. Locally, the Iowa State's College of Agriculture and Life Sciences is enjoying a 98 percent graduation placement rate. The students in the College of Agriculture and Life Sciences are taking jobs around the globe as farmers, agronomists, extension agents and veterinarians. Many students who are graduating this year are deciding between three to four companies when making a final decision on where to begin their career.

The U.S. Department of Agriculture has projected a need for 54,400 new undergraduates to work in agriculture from 2010–15. To put it into perspective, the College of Agriculture and Life Sciences hosted 177 companies at the career fair last fall and anticipates over 190 companies present this year. These companies are looking for hardworking students that are looking to make an impact immediately, to increase market share and growth within their companies during these prosperous times.

How has agriculture survived the recession?

Cereal grains and livestock are in high demand because they are needs not luxuries. In contrast, tourism, recreation and entertainment as a whole can be eliminated from consumer spending. To put it into perspective, let’s use corn — with a value in the state of Iowa of $14.5 billion last year.
Corn is a hot commodity due to an increased need to feed livestock by foreign countries and initiatives to invest in renewable fuels. As the ethanol industry has grown and developed, we now have over 27 percent of corn processed by ethanol plants. Iowa is No. 1 in ethanol production when benchmarking our production nationally. With an increased need for corn due to renewable fuels and feed for livestock, we have seen corn valued at more than $8 per bushel on the Chicago Board of Trade. Many farmers around the North American region had seen prices around $2 per bushel several years before.

This has created profit margins for farmers that have never been seen before in the U.S. corn belt. The Federal Reserve Bank of Kansas City has summarized the boom we have seen documenting these record profit returns. They also point that agriculturalists must be cognizant of the fact that the economy is cyclical and must prepare for a downturn at some point.

The most recent boom in agriculture has offered opportunities for many companies that provide to the American farmer the tools with which to grow and develop. DuPont Pioneer, headquartered in Johnston, Iowa, is a world leader in agronomy employees in over 90 countries. They are currently expanding the number of employees working in Iowa at an extremely strong rate, in turn boosting Iowa's economy. For example, they built a new facility in Johnston that now provides new jobs for over 400 Iowans.

Is agriculture strong internationally, too?

Fortunately, agriculture is a bright spot in many economies across the globe. According to the International Labor Organization, more than 1 billion people are employed by agriculture worldwide, making it the second-largest employer in the world. In fact, agriculture accounted for 35 percent of total employment in the world in 2009.

Today’s growing agricultural sector requires tech-savvy, business-minded students who can communicate, innovate and lead teams of people with diverse backgrounds across the globe. Agriculturalists have learned over the past few years in terms of investing in technology and innovations. Now agriculturalists around the world must look forward to the fun and challenging opportunities ahead capitalizing on areas of prosperity.

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