California Pistachio Growers Packing a Punch
Pistachio growers create nearly $3.6 billion in economic output in the state of California, generating jobs and spending across multiple sectors of the state’s economy, according to a new economic impact study announced recently at the 11th Annual Pistachio Industry Conference by American Pistachio Growers (APG). “These findings demonstrate how important a role pistachio growers and processors play in strengthening the economic climate of the state,” said Dennis Tootelian of Sacramento-based consulting firm Tootelian & Associates, which specializes in economic impact studies. “Their activities are diffused throughout California’s economy, touching nearly every aspect of life in the state.”
APG is a voluntary trade association representing members who are pistachio growers, processors, and industry partners in California, Arizona, and New Mexico. Tootelian was the keynote speaker at the annual conference, which was held in Palm Desert in March, as it will be in 2019. Among his report’s findings:
Economic Output — The overall economic output total of nearly $3.6 billion, the best measure of economic activity, equates to nearly $9.8 million each day of the year. This includes direct spending by the growers and processors as well as additional business activity triggered by that spending.
Jobs — More than 22,600 jobs are created as a result of spending by growers and processors, in addition to the multiplier effect their purchases generate in other sectors of the economy. These jobs are calculated on an annual full-time equivalent basis.
Labor Income — Nearly $1.1 billion in labor income is generated by the business activities of these growers and processors. This results from additional people employed and current employees earning more (for example, from overtime pay). These dollars are diffused throughout the state’s economy as money is spent on an array of goods and services. According to the report, the largest share of these funds is likely to be spent on housing, transportation, and food, based on consumer purchasing patterns.
Business Taxes — More than $120.6 million in additional indirect business taxes, not including income tax, is generated by grower and processor spending. The report notes that these funds could help pay for state and local programs that benefit Californians. For example, the $120.6 million in indirect business tax revenue would cover slightly more than the entire 2016-17 state funding allocation for the California Conservation Corps, which was approximately $112 million.
“This analysis quantifies the impact that pistachio growers and processors have on the lives and businesses of Californians in every corner of this state,” said Richard Matoian, APG Eexecutive Ddirector, which commissioned the study. “The economic activity, jobs, wage income, and purchasing power which spring from this industry improve lives and help California prosper. In cities and suburbs far removed from the more than 250,000 acres of California farmland that produce pistachios, the positive impact of these growers and processors is felt every day.”
The study’s analyses were based on an annual net total spending by the growers and processors, which means that the economic impact reported in the study is expected to occur each year, given the same level of spending.
The study utilized data from a variety of sources, including the California Department of Food and Agriculture, U.S. Bureau of the Census, U.S. Bureau of Labor Statistics, University of California, USDA, and APG.
Beyond the Golden State
American Pistachio Growers also announced the findings of a study it commissioned by Arizona State University’s Seidman Research Institute to estimate the economic impact of pistachio growers and processors in the states of Arizona and New Mexico.
In Arizona, researchers estimated the total economic output of pistachio farming at $31.3 million, 303 jobs, and $13.3 million in labor income. In addition, the study found that the industry in Arizona is responsible for more than $2.3 million in direct and indirect state and local taxes.
In New Mexico, the total economic output of pistachio farming on that state’s economy is estimated at almost $7.1 million by state, 89 jobs and $3.1 million in labor income. The study found that the industry in New Mexico is responsible for $543,104 in direct and indirect state and local taxes.
A crop that adapts well to scarce water supplies, pistachio orchards flourish in California’s driest counties and the high deserts of Arizona and New Mexico. It is estimated the average pistachio farm size in California is 180 acres, with 100-acre and 50-acre farms in Arizona and New Mexico, respectively.