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Corn+Soybean Digest

Farm Labor Compensation: How Do Your Employees Rank?

While technology and larger equipment have increased farming efficiency, there is still a need for the human element in both labor and management roles. Compared to your father, the acreage you are farming has increased exponentially in some cases, with fewer man-hours of labor. But good employees can improve the profitability of an operation, and that requires well thought out salary and benefit programs to attract and retain them. If you have employees, where do they fall on a Corn Belt salary scale?

Wages and benefits for farm workers will vary widely across the country, and range from minimum wage and no benefits for some itinerant workers to higher salaries for valued employees with a lengthy tenure on an operation. Extension Specialists Barry Ward and Chris Zoller at Ohio State University surveyed farm operators in Ohio, seeking details for both full time and part time employees. Their findings were based on surveys covering 171 farm workers. While it does not cover the Corn Belt, nor is it a comprehensive view of Ohio, it represents a sample that depicts current trends in salary and benefits for farm employees.

For fulltime workers, the average cash wage was $28,265 in return for 2,374 hours worked/year, representing $11.91/hour. Part time employees received $9.22/hour. When benefits were valued, the fulltime worker received an additional $5,960 in benefits for a total compensation cost to the operation of $34,225. The survey found that 55.5% of farm workers earned between $20,000 and $40,000/year. Nearly 14% earned less than $15,000 for fulltime employment, and 4% received more than $50,000.

The survey found that 40% of fulltime workers received some form of insurance, with 34% getting health insurance for themselves, and 11% received it for their family. Twenty-nine percent received some type of housing, with that benefit valued at $6,933/year, and some of them included paid utilities valued at nearly $2,000.

Other benefit packages included bonuses for 43% of the employees and use of machinery and equipment for 25% of employees. Retirement plans were provided for 15% of workers, and were valued at $1,655/year. Seven percent received personal use of a vehicle, 13% received meals and 22% received some type of produce or commodities raised by the farm with an average annual value of $360. Education was paid for 11% of workers and 21% received a $143 clothing allowance.

Of the 171 employees covered in the survey, about half worked on farms with field crop production as their primary responsibilities. Specific duties included field equipment operation and maintenance, trucking, seed/fertilizer/chemical procurement, organizing and cleaning up, managing employees, marketing grain and bookkeeping. In total, their wages averaged $26,855, and with a $7,045 benefit package their compensation was $33,901. Their farm labor experience exceeded 12 years, and they had been with that operation over nine years. While less than 10% of those fulltime workers received annual wages less than $15,000, about 60% of them received a wage between $20,000 and $40,000.

The researchers report, “Farm employers will continue to be challenged to find and keep quality employees. Maintaining acceptable wage and benefit packages to compete with other farms and other businesses will be a critical component of the farm business human resource plan.”

They add that a benefit package beyond an hourly wage may make the employment more attractive to prospective employees, but they may not recognize the total dollar value of what is being provided to them.

Good labor is just as important as good management on most farming operations, and being able to retain reliable workers can be made easier with a well thought out compensation and benefit package. While the bulk of farm workers are being paid between $20,000 and $40,000/year, their benefit can vary widely, depending on whether it includes insurance, housing or other personal amenities. Those benefits can help attract good workers, but workers should also know their total compensation includes such benefits.

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