Report: Off-farm income in Alberta
“This report explores the importance of off-farm income for family farms in Alberta and makes comparisons with the other two Prairie provinces of Saskatchewan and Manitoba,” says Ryan Furtas, market analyst/coordinating researcher, AF, Edmonton. “This report also discusses the major determinants of family farms’ participation in off-farm income employment. These are related to individual characteristics of family farm members as well as to farm-specific and socio-economic factors.”
The analysis shows that the off-farm income portion of the average Prairie family farm’s total household income is increasing.
“In 2001-2013, contribution of off-farm income to total household income was, on average, 79 per cent for Alberta, 70 per cent for Manitoba, and 74 per cent for Saskatchewan on average,” says Furtas. “The main source of off-farm income in each province was off-farm employment income (approximately 70 per cent). In all three Prairie provinces the off-farm income was steadily growing over time, while farm income remained quite volatile year after year. This demonstrated a high reliance by family farms on off-farm income in order to maintain a higher standard of living and/or to be able to invest a portion of off-farm income back into the farm. Therefore, one of the major reasons for off-farm employment is risk management strategy in agriculture (as a form of risk diversification). Another reason is that many family farms are too small to be economically viable without off-farm income.”
The report is available on AF’s website.