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In some ways, Nebraska is no longer an agricultural state. There are now fewer farmers in the state. They produce less of the state’s goods and services. You can see that fact in the numbers.

  • The number of farms in the state peaked in 1934 when there were 135,000 farms. In 2001, there were just 53,000 farms in the Nebraska.

  • In part, the number of farms dropped because farms got bigger. In 1935, an average size farm was around 350 acres; by the end of the 2oth century, an average size farm in Nebraska was 875 acres.

  • But the number of farms has also dropped because the total number of acres devoted to farming had dropped as well. In 1950, there were 48.4 million acres in the state devoted to farming. In 2001, that number had dropped to 46.4 million acres.

  • Agriculture in the year 2000 contributed only about $2.5 billion of the state’s total of $56 billion in goods and services produced. Agriculture accounts for only 4.4% of the overall economy, behind construction (4.8%); wholesalers (7.6%); retailers (8.8%); transportation and utilities (10.8%); government including education (13.7%); manufacturing (14.3%); finance, insurance and real estate (15.6%); and service industries (19.7%, including hotels, personal services, repair companies, health and legal services, and museums and tourism).
Nebraska’s Economy in 2000
Nebraska’s Economy in 2000.

To a certain extent, the numbers may be misleading because agricultural related companies may be included in other market segments. For example, Nebraska has a healthy industries manufacturing agricultural and garden equipment. The state has also developed new biotechnology and veterinary medicine companies. And Nebraska has always been a leader in the processing of food products. All of these industries are included in other categories, even though they are related to agriculture.

But, as agriculture changes, state leaders are searching for ways to diversify the economy. Many Nebraska communities have turned to new industries — including telecommunications and computer technology — to develop new markets that can transcend the limitations of vast spaces on the plains.

Recent planning efforts have identified several new target industries. Some of these new industries are related to Nebraska’s traditional economy.

  • Food processing companies. One of the largest processors of food is already headquartered in Omaha, ConAgra. State leaders want to expand this industry even further.

  • Alternative fuels. Ethanol is a fuel additive that helps gasoline burn cleaner and better. It’s produced by distilling corn and other grains, and Nebraska is already a leader in ethanol production.

  • Insurance companies. Nebraska is a leader in the insurance industry, and leaders are looking for ways to use the Internet to expand this business even more.

  • Online stock brokers. One of the major online stock trading companies is now headquartered in Omaha.

  • Metal products. Nebraska is already a dominant manufacturer of farm and garden equipment. Other new companies may grow to fabricate, stamp and bend metal products of all kinds.

Some of these target industries are part of a new economy.

  • Biotechnology. New varieties of crops are being produced by manipulating the genes of existing varieties. Biotechnology is also being used to produce new drugs for both humans and animals. Nebraska has major biotech companies and is looking to expand those industries.

  • Electronics manufacturing. The world now needs more and more computers, telecommunications and electronic components. Nebraska has a significant presence as a producer and supplier of these components, and the industry will develop further.

  • Software development. Software makes the computers run, and Nebraska has several companies writing major software products already.

What sets these new economic developments apart from the old economy is that most of the time it doesn’t matter where you’re located. What’s most important is knowledge and education, as well as access to telecommunication networks. Nebraska has built a strong educational system and is developing the communication network. The state is actually ahead of many other states in the percentage of schools and communities connected to the Internet. But there is more yet to be done.

In addition, agriculture itself has been changed by new technology. Farmers are learning to use computers to determine everything from how much fertilizer to apply to cropland to how to seek out the best markets in which to sell their products. One of the major suppliers of data to farmers is based in Omaha. Farmers have always worked with land, labor, capital, and management economic factors; they are now adding computer technology, which will greatly add to their ability to acquire the knowledge, needed to most effectively utilize the factors of production.

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