Christian Kerr writes:

What good timing. One of the first big publications to land in the in-trays of new Nationals Senators Barnaby Joyce and Fiona Nash will be the Productivity Commission’s Trends in Australian Agriculture, out this morning.

The paper finds that agricultural output, despite drought and other seasonal variations, has increased by around two and a half times in real terms over the last four decades. That will make them happy.

But they should also note that this increase in output was achieved without an increase in the number of agricultural workers, reflecting strong productivity growth in the sector.

It’s important that they also read the parts that spell out how, with even more rapid growth in other parts of the economy, notably the services sector, agriculture’s share of output has declined from around 14% of GDP in the early 1960s to 4% in 2003-04 – and that agriculture’s share of employment has also more than halved since the late 1960s.

That’s not necessarily bad news. The Commission’s own release talks about a number of significant changes in the make-up of the sector over the last two decades:

Australian farms are now fewer but larger, and production has become more concentrated on the larger farms. Australian agricultural industries have become more export oriented. Exports have also become more diverse, with less reliance on traditional commodities such as wool and more on processed products such as wine, cheese and seafood. The agriculture workforce has seen a decline in the proportion of employers and contributing family workers, and an increase in the proportion of employees. Off-farm employment has also become increasingly important to maintaining family farm incomes.

Export operations need to be able to stay in touch. More broadband in the bush, anyone?

Peter Fray

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