Survey provides dairy farm employee compensation benchmarks

By Steve Maier

“What do other farms pay their employees?”  “What benefits do they offer?”  “How do you compete for good employees?”

Our team at Agri-Business Consultants, LLC is often asked these questions.  To help farms benchmark their employee compensation and benefits, we conducted a survey of 50 Midwest dairy farms this summer and summarized the results.

Click here for the full report.

Recruiting and retaining employees
Farm owners – and those of us who work closely with them – have observed a growing challenge in hiring, training and retaining quality employees.  Survey respondents identified skill set, wage level and competition for workers as the three biggest challenges to finding employees.

That said, our survey also revealed that 78% of farms are staffed at 90% capacity or greater.  Almost 40% of farms have an average employee longevity of greater than five years.

Compensation and benefits
Most of the farms surveyed (54%) said they compensate employees with an hourly wage.  The herdsperson and mechanic earn the highest hourly wages on the farm, averaging $17.61 and $18.70, respectively.  The average starting salary is $11.80 for milkers, $14.40 for feeders and $12.92 for calf feeders.

Housing is provided in some form by 71% of the farms surveyed.  Most of these farms (51%) provide housing at no cost and 20% offer housing at a discounted rent rate.

In addition, farms provide a wide range of other benefits to employees.  Examples include performance bonuses, paid vacation, sick pay, health insurance, 401(k), farm clothing, use of farm vehicles, and free Internet and cable TV.

Contact Agri-Business Consultants if you are interested in taking a closer look at your farm’s business management and finances.

About the author:  Steve Maier is a financial consultant with Agri-Business Consultants LLC (ABC), a Vita Plus company.  He grew up on his family’s dairy farm in Chippewa Falls, Wisconsin.  Maier earned his bachelor’s degree from the University of Wisconsin-River Falls.  He previously worked as a nutritionist and agricultural lender, and also owned and operated his own dairy farm.  At ABC, Maier works with clients on a variety of projects, including quarterly and annual financial management monitoring, feasibility studies, and business succession planning.