Fresh produce industry vital to Arizona economy, research shows

12/04/2013 03:37:00 PM
Mike Hornick

The Nogales, Ariz., fresh produce industry and related businesses account for just over a third of all economic activity in Santa Cruz County — $437.7 million, according to University of Arizona researchers.

Beside putting hard numbers to fresh produce jobs, wages and tax revenues, their study “Fresh Produce and Production-Sharing: Foundations and Opportunities” suggests paths Nogales might take to growth, including extending its season.

“It really showed the region here is heavily dependent on fresh produce,” said Lance Jungmeyer, president of Nogales-based Fresh Produce Association of the Americas.

“When you look at direct and secondary impacts, fresh produce accounts for more than 20% of jobs and nearly 25% of wages.”

Findings

The 51-page study, released in September, was prepared for Nogales Community Development by the university’s Eller College and Department of Agricultural and Resource Economics.

Authors Vera Pavlakovich-Kochi and Gary Thompson found that fresh produce generates:

 

  • $303.4 million in direct output;
  • $134.3 million in secondary output;
  • 2,644 direct jobs and $146.6 million in wages;
  • 1,375 secondary jobs and $43.6 million in wages; and
  • $45 million in state and local tax revenue.

 

Every 100 fresh produce jobs generate 52 more in related fields, according to the study.

That’s an additional 29 cents in wages for each dollar in fresh produce wages, and an added 44 cents output for each dollar of fresh produce output.

Competition

Even though total dollar value has been trending upward in Nogales, compared to other ports of entry — especially in Texas — its share is declining.

Exports from central Mexico shipped through Texas ports have been on the rise, and Texas is more convenient for fresh produce trucks bound for the Midwest or Northeast.

But the larger issue is that unlike central Mexico, Sinaloa and Sonora — the sources of the Nogales industry — do not grow year-round.

Recommendations

The study recommends pursuing relationships with Instituto Tecnologico de Sonora and other Mexican universities that have developed pilot programs for new plant types and technologies that might begin to extend the limits of the western deal.

Makers of forklifts and heavy equipment; packaging materials; seeds and fertilizers that operate largely outside the country are a source of opportunity according to the study, which refers to them as “missing industries.”

Other barriers to growth in Nogales include workforce availability and qualifications.

The study is available at http://tinyurl.com/pjjeuvq.



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