Off-farm business ventures generate more income than onfarm diversification

A chart showing the multi-enterprise farm household activities in 2007.

Historically, many U.S. farm households have engaged in other income-generating activities independent of commodity production to support their lifestyles and to help maintain the economic viability of their farm operations. These business ventures can be classified into two broad categories distinguished by the degree to which farm resources are employed or leveraged. Onfarm diversification uses amenities and other attributes of farmland resources and lifestyles to create additional businesses, while other farms operate off-farm businesses in other sectors of their local economy. In 2007, farm households engaged in 791,000 distinct alternative entrepreneurial ventures that generated $26.7 billion in household income. Onfarm diversification and off-farm business ventures each accounted for about half of these activities, but off-farm business ventures generated more than 80 percent of noncommodity business income accruing to farm households. This chart is found in the ERS report, Multi-Enterprising Farm Households: The Importance of Their Alternative Business Ventures in the Rural Economy, EIB-101, October 2012.

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