Record farm incomes are pushing the state economy to buck the national trend, according to the latest report from the Nebraska Business Forecast Council.
University of Nebraska-Lincoln Bureau of Business Research Director Eric Thompson forecasts steady employment and income growth in most industries the next two years, paced by strong farm incomes.
“In fact, a record year; we project that farm income will reach $5.4 billion in 2011,” Thompson says. “Not only that, we expect that the strong farm income will continue into 2012.”
A farm income of $5.4 billion would be a 35% increase from 2010. The Forecast Council expects farm income to remain strong in both 2012 and 2013. The report predicts strong income overall, both farm and non-farm, in 2011 with growth of 1.2% in 2012 and 1.8% in 2013. Non-farm incomes, according to the report, should grow a healthy 5.4% this year and nearly 4% in 2012 and 2013.
Nebraska farms have benefitted from rising commodity prices, increasing cooperation between the crop and livestock sector and producer management skills.
Employment in the service sector should grow this year by 2.3%, according to the report, which expects about the same growth the next two years. Between 6,000 and 9,000 new jobs are expected in health care, professional and scientific jobs with growth in arts, recreation and entertainment as well.
The report expects the manufacturing sector to remain solid, due to its ties to agriculture. It predicts manufacturing job growth of just over 4% this year and about half that in 2012 and 2013. That will contrast the financial sector, which is expected to lose a few jobs this year before rebounding slowly in 2012 and 2013. The housing slump has dragged down the finance, insurance and real estate sectors.