Iowa Select: Livestock Operations are Lifeblood of Rural Communities

If we’ve heard it once, we’ve heard it a thousand times—rural Iowa is declining and urban centers are growing. Our state leaders have tried numerous policies and programs to grow rural Iowa, but while doing so, it can be easy to overlook who may be holding it all together—our farmers.

According to Dermot Hayes, Charles F. Curtiss Distinguished Professor in Agriculture and Life Sciences at Iowa State University, Iowa’s “Hometown Hero” might just be of the porcine species.

A study conducted by Hayes measured the economic contribution of Iowa Select Farms to the State of Iowa. The results of the study confirmed previous work which explored what caused some rural communities to decline and others to grow.

These results of the previous work showed:

  • Rural counties grew more slowly than urban counties, however rural counties with livestock growth fared better
  • Rural counties that do not benefit from livestock growth experience an annual loss of $17 million in county income
  • Livestock growth effectively offsets, and even reverses, the economic decline in rural counties

As farmers and Iowans, we’re humbled by the responsibility and opportunity we have to create economic growth for our agricultural counties. In his new study, Hayes confirmed that Iowa Select Farms’ projected 2019 direct, indirect and induced employment would total 10,961 Iowans, an increase of nearly 4,700 jobs compared to 2016.

The study also reveals that by 2019, Iowa Select Farms will generate:

  • $633 million in total annual income for the direct, indirect and induced jobs created
  • $1.5 billion in total annual economic output for the state of Iowa
  • $3.2 billion in total economic impact to the packer-processor industry
  • $52 million in annual state government tax collection when you add in the packer-processor contribution

Young Farmers: They Do Exist
Common descriptions of rural communities often include “young people are leaving rural Iowa.” A closer look at the facts shows quite the contrary. In fact, livestock is an open doorway for a young person to be involved in agriculture. At Iowa Select Farms, 405 employees are between the ages of 18 and 30. Add in young contracted farm managers, and that number grows to nearly 750.

“A large focus in rural areas is how to retain our youth and bring in new, young professionals,” said Brandy Ripley, Sac County Economic Development. “Having businesses like Iowa Select Farms offering competitive pay, benefits, and community support is essential to doing just that.

Mike Gaul, Iowa State University College of Agriculture and Life Sciences (CALS) Director of Career Services, is proud of the fact that graduates of CALS get job offers that keep them in Iowa.

“Contrary to concerns regarding the ‘brain drain’ of college graduates out of Iowa, it’s refreshing to have a large population of our graduates seek employment in many of our rural communities,” he said. “For the past decade, nearly 70% of CALS graduates have remained in Iowa for their first employment experience— that’s nearly 20% higher than the university average.”

Iowa Select Farms creates many of those employment opportunities for graduates by increasing their year-on-year ISU CALS hires. The company is ranked sixth for largest ag employer in 2016-2017, moving up from the number nine spot in the previous year.

“The results of the study are clear,” said Hayes. “One can reasonably conclude that through direct and indirect job creation, Iowa Select Farms is helping parts of rural Iowa offset, or even reverse, long-term economic decline experienced in more economically-stagnant areas.”

$3,333 for Every Iowan
When it comes to the Iowa pork industry, everyone’s a winner. “When you look at the total contribution of the Iowa pork industry to the state’s economy— $10.89 billion—that’s a $3,333 economic benefit for every Iowan,” Hayes said.

“Based on Iowa Select Farms’ sow farm growth plan, they will soon account for 14% of Iowa’s total pork production.”

“We’re very proud of the economic impact the entire pork industry has on Iowa,” said Jeff Hansen, owner and CEO of Iowa Select Farms. “We know that it’s not just pork farmers—but thousands of other Iowans, as well —that are crucial to the success of our industry.

Livestock Growth Helps Reverse Iowa’s Budget Shortfall
Hayes’ study also found tax payments attributable to Iowa Select Farms’ direct economic contribution (sales, excise, and state income tax) will soon total $32 million—up 75% from 2016. An additional $20 million in taxes will be generated by Iowa Select Farms’ contribution to the packer-processor sector.

Hayes estimates total state taxes generated based on Iowa Select Farms projected 2019 levels will likely exceed $52 million. This comes at a time when the Iowa Legislature grapples with finding the dollars to fund primary and secondary education, Medicaid and mental health programs, and other initiatives critical to Iowans’ quality of life.