Farm Household Economics and Well-Being: Historic Data On Farm Operator Household Income

NA = Not yet available.
f = Forecast.

1/ Prior to the Agricultural Resource Management Study (ARMS) and its predecessor, the Farm Costs and Returns Survey (FCRS), operator household income was derived by assuming farm operator households received all of the income from the farm business. This is no longer a valid assumption, since contractors now receive about one fourth of aggregate farms sector net cash income. Nevertheless, data users frequently request a time-series extending further into the past than the ARMS can provide. Data from 1960 through 1987 are provided here, although they are not consistent with the FCRS and ARMS data available from 1988 forward.

2/ This income series was developed to be definitionally consistent with the CPS family/household income series. Gross rental value of farm dwellings, the value of home-produced food, and the value of the change in inventories were subtracted from net farm income, while the value of wages that farm businesses paid members of farm operator households was added when it became available in 1982. This series was based on the assumption that farm operator households received all of the income from the farm business, an assumption which is no longer valid. The estimates presented in this table utilize the methodology presented in Ahearn, with revised sector estimates. See: Ahearn, Mary. Financial Well-Being of Farm Operators and Their Households. AER-563. USDA, ERS, Sept. 1986.

3/ The current definition of a family farm for the 2005 and 2006 estimates based on the Agricultural Resource Management Survey is one in which the majority of the business is owned by individuals related by blood, marriage, or adoption. In 2005, 94 percent of farms were classified as family farms, and 96 percent in 2006. Immediately prior to the implementation of the current definition, farm operator households consist of all members of the households of the primary operators of farms organized as individual operations, partnerships, and family corporations. Household members include all persons dependent on the household for financial support, whether they live in the household or not. (Students away at school, for example, are counted as household members if they are dependents.) The total income of farm operator households includes income from both farm and nonfarm sources. Consistent with the Census Bureau's definition of self-employment income, farm income to the household is defined as the net cash farm income less depreciation (adjusted for the share received by the primary operator household in the case of multiple-household farms). We also include the income that all farm household members receive from all other sources. Most farm households receive some off-farm income, including off-farm wages and salaries, the net income of any off-farm businesses, interest and dividends, and any other off-farm cash income received by household members. Data for all years are expanded to represent the number of farms and ranches in the contiguous United States. See: Revised table 2, Economic Indicators of the Farm Sector: National Financial Summary, 1993. ECIFS 13-1. USDA, ERS, December 1994.

4/ For 1960-66 data are for families. For 1967 forward, data are for households. Source: US Dept. of Commerce, Bureau of the Census, Money Income of Households, Families, and Persons in the United States. Series P-60 Reports, various years, and unpublished Historical Income Tables--Households, Table H-5 (http://www.census.gov/hhes/income/histinc/h01ar.html), revised August 27, 2004.

5/ For 1960-87, calculated as column (A)/column (E); for 1988 forward, calculated as column (D)/column (E).

6/ Revised estimates, based on weights that expand the count of farms to match the official USDA number of farms. These estimates differ from other 1988-1990 estimates based on earlier weights that expanded the count of farms to represent the farm operator households surveyed in USDA's Farm Cost and Returns Survey, (FCRS).