Agriculture: Supply and Demand
Great Bend Tribune
Published December 13, 2015
As you read this the Fall Semester at Barton has just ended. Most of the students in the agriculture program have headed back to help on the family farm or some other agriculture operation. Numbers are good for the agriculture program at Barton and for most other two and four year institutions providing a variety of programs for the agriculture industry. This is in spite of an improving economy and slight declines in enrollment for many other areas of study across the state. What makes agriculture such a hot area?
There is an article (http://www.forbes.com/sites/jeffreydorfman/2015/12/04/want-a-job-study-food-and-agriculture/) from Forbes titled “Want A Job? Study Food And Agriculture” making the rounds on agriculture themed social media. It states the USDA forecasts the need for graduates in the area over the next five years is almost 58,000 per year or 290,000 over that period. However currently the graduation rate is forecasted at only 35,400 per year. Hence the title of this article. And please, to the economists out there, this is a simplified explanation.
In economics in free markets, the market determines the price of a commodity as buyers and sellers come together to find the equilibrium or market price, where supply equals demand. When the supply is greater than the demand a surplus exists. In order to move the supply, prices will decrease to increase demand and decrease until demand increases. And supply will decrease as at lower prices, less will be produced to supply the market until equilibrium is again reached.
The other disequilibrium situation is when the supply is less than the demand or a shortage. Here in order to increase the supply, consumers will pay more to obtain what they need and the price will continue to increase to increase the supply of the desired good. And as prices for the good increase, the production of the good will increase in response to the increased value of the product until supply meets demand. This is the situation in the agriculture job market.
These jobs are not just in production of food, fiber and fuel but in all phases of the industry. They do not necessarily require a four-year or advanced degree but often a two-year degree or certificate. Across all jobs termed “agriculture” the starting salary averages $47,300 per year with a $5,000 annual bonus. Two items, first this is an average which can be misleading and it includes everything from IT and operations managers to entry level workers. However, if you look around this area, many of the highest paying jobs with good benefits are in the Ag sector.
Just a little over a year or so ago, there was an article stating Ag and Ag related fields was the worst choice for a college major. Guess maybe they were wrong.