Economic Impacts on Rural Economies

Proponents of CAFOs invariably promote factory farms as a logical strategy for rural economic development. The promoters point to employment in CAFOs as providing new job opportunities for local unemployed workers. Local leaders rationalize the tax breaks and subsidies with claims that workers in new factory farms will bring more economic activity and more local tax revenues to the community to support local public services, such as roads, schools, police protection, healthcare, and other social services. As a result, CAFOs are frequently offered preferential tax assessments, tax credits, and various economic incentives.

Promoters of CAFOs typically rely on economic impact assessment models to support their claims. However, more than 50-years of real world experience refute the economic models.

Factory farms inevitably employ fewer people than the number of independent family farmers they displace. Between 1980 and 2008, as industrial livestock operations displaced independent farmers, USDA statistics indicate the number of beef cattle operations fell by 41%, hog farms declined by 90%, and dairy farms fell by 80%.* The CAFOs were producing a similar number of animals with far fewer farmers. This is the logically expected impact on employment because the economic efficiency of industrialization arises from lower costs of labor and management.

Poor working conditions, lower-skilled work, and pressures for lower labor costs, typically result in workforces composed largely of immigrant workers desperate for employment. A University of Wisconsin study found the percentage of immigrant workers on Wisconsin dairy farms increased from 5% to 40% between 1998 and 2008, years of rapid growth in dairy CAFOS.1 Workers who migrate into CAFO communities are often from less-developed countries. They add cultural diversity to rural areas but add a far larger burden on local public services – particularly public schools, police protection, and public health care – than their meager wages yield in local tax revenues. Even without tax subsidies, higher costs for local public servicers, road maintenance due to heavy truck traffic, increased water treatment costs, and other public infrastructure expenses more than offset any increase in local tax revenues.

A 2006 study commissioned by the State of North Dakota Attorney General’s Office reviewed 56 socioeconomic studies documenting the negative economic impacts of factory farming on rural communities: “Based on the evidence generated by social science research, we conclude that public concern about the detrimental community impacts of industrialized farming is warranted. In brief, this conclusion rests on five decades of government and academic concern with this topic, a concern that has not abetted [sic], but that has grown more intense in recent years, as the social and environmental problems associated with large animal confinement operations have become widely recognized. It rests on the consistency of five decades of social science research which has found detrimental effects of industrialized farming on many indicators of community quality of life, particularly those involving the social fabric of communities.”2 Fifty years of experience has proven that factory farms do not support rural economies.

1), “Immigrants now 40% of states dairy workforce,” November, 2009.

2 Curtis Stofferahn, “Industrialized Farming and Its Relationship to Community Well-Being: an Update of the 2000 Report by Linda Lobao,” special report prepared for the North Dakota, Office of Attorney General,

Economic Impacts used with permission from the Iowa Alliance for Responsible Agriculture