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Is Agriculture Pennsylvania’s “Number One” Industry?

A recent research white paper from Penn State’s Department of Agricultural Economics and Rural Sociology sheds light on the commonly heard claim that agriculture is Pennsylvania’s largest industry.  The paper, “Is Agriculture Pennsylvania’s ‘Number One’ Industry?”, uses Department of Commerce and other data to answer this question with a definitive “no.”  Yet it goes on to argue that no matter agriculture’s rank in Pennsylvania compared to other industries, for a variety of reasons it is a vitally important part of the Commonwealth.

The paper furthermore discusses that the ‘Ag is Number One’ myth glosses over the important fact that Pennsylvania’s agricultural economy is actually two separate but related agricultural economies; (1) a consumption agricultural economy composed of Pennsylvania’s grocery stores, restaurants, and other businesses which primarily exist because Pennsylvanians have to ea; and (2) a  production agricultural economy composed of farms, farm supply firms, and food processors which exist because Pennsylvania has farms and farm production due to its good soils and climate.   The consumption side far outweighs the production side in economic size, and is not directly dependent upon Pennsylvania farm production.

The paper argues that there is significant economic development potential in recognizing and bridging these two agricultural economies; Pennsylvania has a large market of over twelve million residents who must continually buy food products from somewhere.  If they’re not buying from Pennsylvania farms and food manufacturers, their food dollars simply leave the Commonwealth and thus are unavailable to be spent on other goods and services in Pennsylvania.  Increasing the overlap between the consumption and production of Pennsylvania-grown foods would increase opportunities for farmers, increasing local food production through local sales and keeping more dollars in Pennsylvania.

The White Paper is available on-line, at: http://extension.aers.psu.edu/pubs/IsAgNumberOne.pdf