(Image Source: Preston Bousley / Unsplash)
Wisconsin IDEA
Insight • Data • Economics • Analysis
Wisconsin Experienced a 24 Percent Decrease in Farms between 2002 and 2022
Farming is an integral part of Wisconsin’s economy, self-identity, and culture, a fact reflected in the names of two of the state’s three professional sports teams, the Green Bay Packers and the Milwaukee Brewers, which are both inspired by farming-related activities. Unfortunately, as highlighted in a recent analysis by Hadachek and Deller (2024) of the latest Census of Agriculture, the number of farms in Wisconsin has been steadily declining, dropping from 77,131 in 2002 to 58,521 in 2022. The decline in dairy farms is even more dramatic, decreasing from 16,886 in 2002 to just 6,216 in 2022. Several factors contribute to this trend, including the aging farm population and the high costs of starting a farming business for younger farmers. A critical reason for the decline is that many farms are unable to generate sufficient income to support a farm family or household.
Figure 1. Wisconsin Off Farm Household Income
One strategy that many farm families use to supplement their income is through off-farm employment. Historically, off-farm jobs have provided access to health insurance, with the income from these jobs viewed as supplementary. By using data from the USDA Agricultural Resource Management Survey (ARMS) for Wisconsin, we can track the reliance of farm families on off-farm income across various types of farms. Between 2018 and 2022, on average, 79.3% of farm family income came from off-farm sources, a percentage that has remained relatively stable over the past five years. This reliance inversely correlates with the size of the farm. For instance, off-farm income for the largest farms (with sales of $1 million or more) accounted for only 15.1% of total farm family income. However, for smaller farms (with sales of less than $100,000), off-farm income averaged 102.5% of farm family income, indicating that off-farm income is not just supplementary but is also supporting the farm enterprise itself.
This high level of dependency on off-farm income suggests that without such income, the farm enterprise would not be sustainable. Alarmingly, nearly three in four (76%) Wisconsin farms fall into the category of having sales less than $100,000. Only 3% of Wisconsin farms have sales of $1 million or more, while 3.7% have sales between $500,000 and $999,999. The policy implications are evident: the dependency of rural communities on farming has reversed, with typical Wisconsin farms increasingly relying on rural communities and the employment opportunities they provide. Therefore, an immediate strategy to help ensure the survival of many Wisconsin farms is to create and maintain off-farm employment opportunities.
