Farms’ Role In Idaho Economy Declines High-Tech Industry Growing In Importance, UI Study Says

Agriculture’s dominance of the state economy is declining as electronics and other high-tech business grows, a University of Idaho study says.

“They’re not making more land,” agricultural economist Jim Nelson said. “There’s really not much room for ag and ag-related sectors to grow much.”

The challenge facing Idaho policymakers is to find ways to support agriculture and other resourcebased industries, which provide the bulk of income and employment, while encouraging the high-tech upstarts leading the economy’s growth, Nelson said.

Farmers now worry that their industry’s waning economic prominence is leading to a loss of political clout. They’re about to join with dairymen and ranchers to form a political action committee aimed at helping candidates friendly to agriculture.

In 1993, agriculture contributed 14 percent of the state’s gross product and food processing chipped in 10 percent, according to the economic analysis by agricultural economist Roger Coupal.

The study considered each sector’s direct contributions to the economy through out-of-state exports and its indirect benefits with in-state spending and respending of export earnings. It relied on the most recent available data from the U.S. Department of Commerce.

Government - primarily federal spending - contributed 20 percent of the 1993 gross state product, followed by wood products at 11 percent, construction with 10 percent and electronics at 7 percent.

The resource extractive industries of agriculture, mining, food processing and timber together accounted for more than 35 percent of the state’s gross product and 33 percent of employment. All resource-related industries, including tourism, added up to almost 66 percent of the state’s gross product.

“It generally is a healthy economy,” Coupal said. “It’s diversified. It tends to be growing in those parts of the economy where we have growing demand nationally: tourism, food processing, electronics.”

Any future growth in agriculture will likely come from the development of new crops or “value-added” products such as specialty cuts of beef, said university farm economist Neil Meyer.

“I don’t see huge changes in agricultural productivity or new areas coming into production,” he said.

The state’s top 1993 contributor to employment was government at 23 percent followed by agriculture at 12 percent, construction with 11 percent, food processing at 10 percent, wood products with 9 percent and electronics at 6 percent.

From 1983 to 1993, job growth occurred fastest in the state’s manufacturing, trade and service sectors. Employment in agriculture fell from 25,918 in 1983 to 23,630 in 1987 and 20,985 in 1993.

MEMO: This sidebar appeared with the story: GROSS PRODUCT In 1993, agriculture contributed 14 percent of the state’s gross product and food processing chipped in 10 percent. Government contributed 20 percent, followed by wood products, 11 percent; construction, 10 percent; electronics, 7 percent.