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Dairy farmer career paths: getting in, out, and by (Research Brief #26)

Posted February 1998

The experiences of New Zealand’s dairy farmers may help their colleagues in Wisconsin boost the state’s dairy industry. That’s the conclusion of a study on dairy farmer career paths sponsored by the Center for Integrated Agricultural Systems (CIAS).

New Zealand historically has attracted young people into farming through dairy industry leadership efforts and the creation of formal, well-articulated career paths that aspiring farmers can count on. Similar supports in Wisconsin may help reverse the trend of declining numbers of young people entering farming and may help older farmers retire profitably.

Steve Stevenson, CIAS sociologist, studied New Zealand dairy career paths with an eye toward finding ways to improve farm entry and exit in Wisconsin. He collaborated on field research in New Zealand with Russ O’Harrow, an Oconto County dairy farmer and former CIAS Citizens Advisory Council member, and Doug Romig, a former CIAS research assistant.

The study was co-sponsored by the UW-Madison Babcock Institute for International Dairy Research and Development and the Agricultural Technology and Family Farm Institute (now the Program on Agricultural Technology Studies). Also sponsoring the study was the Wisconsin Farm Entry and Exit Coalition, formed to help develop mechanisms to help people get into and out of farming.

An integrated agricultural system

The primary finding of the research: New Zealand’s historical success and current tensions relating to farmer career transitions are due to the integration of three key components of that nation’s dairy industry.

Supportive dairy farming systems.

New Zealand’s dairy farming systems are built on a favorable physical climate and intensive grazing techniques. These have made possible the lowest variable costs of production in the world. This has helped aspiring farmers enter the industry relatively easily in the past…though rising land costs increasingly undercut this trend.

A nationally integrated organizational structure.

New Zealand has integrated its dairy industry nationally. The New Zealand Dairy Board heads that structure, providing leadership on important dimensions of the dairy industry, particularly marketing opportunities for new,
existing, and potential products. In 1993, the Dairy Board marketed New Zealand dairy products in more than 100 countries with a specialized, value-added strategy yielding nearly $3.5 billion worth in sales.

Institutionalized farmer career paths.

New Zealand has developed a career structure that enables committed, energetic persons from farm and non-farm backgrounds alike to enter, advance within, and retire from dairy farm careers and enterprises fairly smoothly.

Wisconsin and New Zealand farming at a glance
New Zealand Wisconsin
Average herd size (1992-94) 190 50
Average farm acreage (1992-94) 195 293
Total dairy herds (1992-94) 14,597 30,156
Average age of farmer 39 48
Percent of farmers from
nonfarm backgrounds
33 <5

New Zealand’s career structure

Stevenson feels it’s the third of the above features that may have the most to teach Wisconsin about its farm entry and exit challenges. “The first component, variable costs of production, are clearly higher in Wisconsin than in New Zealand,” he says. “And the second, a nationally integrated organizational structure, isn’t likely in the U.S., given the marketplace structure here.”

“We in Wisconsin stand to learn something from New Zealand’s dairy career structure, though,” says Stevenson.

Formal dairy career paths

New Zealand’s formal career structure has the following components:

  • Dairying in New Zealand has clear career stages. These steps in a career pathway have been institutionalized, and role models are plentiful for farm families at all ages.
  • High quality training and farm apprenticeships prepare young, aspiring farmers for successful entry into dairying.
  • A system of effective mid-career transitions lets young farmers move through the system. Contract and sharemilking arrangements allow farmers to defer land ownership until the middle stages of their careers while accumulating capital in the form of cattle.
  • Entry and exit strategies complement each other. Phased-in retirement and farm exit strategies complement staged farm entry strategies.
  • Institutional support from both the public and private sectors coordinate and legitimate the overall farmer career structure.

“New Zealand’s dairy farm career system poses challenges and opportunities for Wisconsin’s,” notes Stevenson. “That’s not to say that their way of doing things can be plugged into the structures here, but there are lots of opportunities for continued exchange between Wisconsin and New Zealand that could help make dairy farming a more viable career option for young people here.”

Opportunities, challenges for Wisconsin

Stevenson and his colleagues identified three opportunities and challenges for Wisconsin’s dairy community:

  • Develop effective and rewarding dairy farmer career structures. This includes the recruitment and training of new dairy farmers, ways to make effective mid-career transitions, planning for farmer retirement and exits from farming, and coordination and support of these structures.
  • Develop institutional arrangements that respond to farmers and provide industry leadership. This includes planning for marketing dairy products and securing the support of key industry components, developing farmer-responsive cooperatives and other organizations, and addressing larger issues of how to integrate the industry with community development.
  • Adapt pasture-based production and management systems for Wisconsin. This includes facing environmental challenges (like climate and groundwater protection), developing labor and management practices that are effective in Wisconsin, learning more about the relationship between lowering capital costs and entering farming, evaluating farm safety, assessing differences in quality of life between pasture-based and confinement-based systems, and understanding the economic impacts of grass-based systems.

Finally, Stevenson and his colleagues point out that one of the great, as-yet-undeveloped opportunities lies in the potential for exchanges between Wisconsin and New Zealand.

“Relationships among people are the basis of any successful industry,” observes Stevenson, “and exchanges between Wisconsin and New Zealand among farmer training organizations, industry leaders, farmers and academic researchers, and students in both places could be deeply instructive for everyone.”

Forthcoming Research Briefs will focus on New Zealand’s dairy farmer career paths and sharemilking arrangements.

A full copy of the 54-page report, Dairy Farmer Career Paths-Farm Entry and Exit Transitions in New Zealand and Wisconsin: Observations, Challenges, and Opportunities for Exchange, is available from CIAS. A summary of this report and order information are available online.

Contact CIAS for more information about this research.

Published as Research Brief #26
February, 1998