Michigan Land Use Institute

MLUI / Articles from 1995 to 2012 / Study Says Buying Local Food Would Boost State Economy

Study Says Buying Local Food Would Boost State Economy

Forecast sees almost 2,000 new jobs, jump in farm profits

September 5, 2006 | By Patty Cantrell
and Michael Hamm
Great Lakes Bulletin News Service


Michigan is second only to California in the diversity of its agricultural products.

Beulah — Robust efforts to increase sales of fresh, local foods in Michigan could significantly boost employment and personal income across the state, according to a new study by university and nonprofit researchers.

Eat Fresh and Grow Jobs examines six different scenarios in which existing farmers double or triple the amount of fruits and vegetables they sell into fresh produce markets, such as wholesale grocery sales and farmers markets. Using an economic modeling tool customized to Michigan, the study determined the shift could increase net farm income in Michigan by $164 million, or nearly 16 percent. As farm families spend this new income, the study shows they could generate up to 1,889 new jobs across the state and $187 million in new personal income from those jobs.

“What this study shows is Michigan can improve the economy by creating linkages between farmers and consumers throughout the state,” said co-researcher Michael Hamm, director of the C.S. Mott Group for Sustainable Food Systems at Michigan State University. 

“There are big opportunities for Michigan farmers to tie into the national trend toward local food, use that to add to their bottom line, and create jobs with their increased spending capacity,” he said.

The study is the first job-forecasting model for fresh foods in Michigan and one of the most comprehensive of its kind in the country. It is a collaborative effort of Michigan State University’s C.S. Mott Group for Sustainable Food Systems, the Michigan Land Use Institute’s Entrepreneurial Agriculture Project, and the W.E. Upjohn Institute for Employment Research based in Kalamazoo.

Fresh Food, Fresh Recommendations
Eat Fresh and Grow Jobs includes a number of recommendations for how state leaders can help more Michigan farms take advantage of fresh marketing opportunities. 

Strengthening efforts to promote Michigan-grown foods is a top priority. Already, the state’s Select Michigan campaign, which provides a marketing boost to Michigan producers in grocery stores, has increased sales of Michigan products despite a limited scope and meager budget of around $300,000 per year.

Michigan asparagus growers, for example, went from selling about 5 percent of their crop to fresh markets in 2002 to fully 25 percent in 2005, thanks in large part to Select Michigan.

John Bakker of the Michigan Asparagus Advisory Board says, “Select Michigan was exactly what we were looking for to revitalize and jumpstart our fresh market efforts.”

Overall, the study’s projections for up to 1,889 jobs could warrant a state economic development investment of at least $9.5 million toward marketing Michigan foods and helping farms and related businesses supply more fresh markets.

A Good Deal
That investment amounts to just $5,000 per potential job compared to the more typical level of economic development investment at $15,000 per job nationally. Many of the study’s recommendations are no- or low-cost changes in state government, from new coordination among agencies on food system goals to putting more emphasis on fresh market opportunities in existing agriculture programs.

The Michigan Food Policy Council, which will soon release its recommendations to Governor Jennifer M. Granholm, is one body that focuses on how the state can accomplish a range of goals − from improving public health to saving farmland − by building better market links between Michigan farms and consumers.

“Michigan’s dynamic agriculture industry continues to contribute significantly to the health of our communities and our economy,” said Michigan Department of Agriculture director Mitch Irwin, who leads the Council. “We are keenly focused upon keeping up the momentum of this growing sector through the promotion of our quality, homegrown products.”

The reasons for Michigan farms to expand into fresh markets are compelling:

  • Currently 74 percent of Michigan fruits and 44 percent of its vegetables are sold at relatively low prices as ingredients for canned, frozen, dried, and other processed products.
  • Much of the $1.9 billion of higher-value fresh fruits and vegetables consumed in Michigan comes from other states and countries.
  • Michigan farms can meet a broad range of fresh produce market demands.
  • Michigan-grown fresh produce is gaining in competitive advantage through new consumer demand for locally grown food.

“Consumers are beginning to buy more local foods for a variety of reasons,” said co-researcher Patty Cantrell, director of the Entrepreneurial Agriculture Project at the Michigan Land Use Institute.

“It ranges from restaurant chefs who know they can sell the story of the local farm along with the farm’s sautéed greens to parents getting kids excited about fruits and vegetables by offering them juicy, fresh-picked varieties.”

She adds: “It’s time to take these opportunities seriously and invest in them significantly.”

Patty Cantrell directs the Michigan Land Use Institute's Entrepreneurial Agriculture Project. Reach her at patty@mlui.org. Michael Hamm directs Michigan State University's C.S. Mott Group for Sustainable Food Systems.

Michigan Land Use Institute

148 E. Front Street, Suite 301
Traverse City, MI 49684-5725
p (231) 941-6584 
e comments@mlui.org