Dairy Sector Development and Poverty Reduction
In a recent comprehensive report produced by the GDP in conjunction with the Food and Agricultural Organization of the United Nations (FAO), the value of dairy sector development has been shown to be a powerful driving force in poverty reduction, the first of the sustainability development goals. This intensive analysis of the link between dairying and the improvement of human welfare and socio-economic conditions can be summarized with several key findings, illustrated below.
Household Level Findings
Dairy farming results in substantial employment generation and value-addition beyond the farm gate, which in turn spurs development and poverty reduction in the wider community.
Farms with dairy cows, in addition to generating significantly more employment per cow that farms without dairy cows, also paid higher wages.
In Bangladesh, Ghana, Kenya and India, studies show that raw milk collection and distribution creates between 20 and 40 full-time jobs per 1,000 litres of traded milk.
In India, and Bangladesh, milk processing generates another 60 to 100 jobs per 1,000 litres of processed milk.
Economy-wide level Findings
Studies from the USA and Canada indicate that 0.3 to 1.5 non-dairy farm jobs are created for every dairy farm job. For the processing sub-sector, overall employment is lower, but multipliers are higher, ranging from 3.3 (Virginia) to 6.6 (Colorado) in the available examples.
An indication of the potential magnitude of employment generation by a vibrant dairy industry is provided by an assessment of the Kenyan dairy industry (USAID 2014). The study estimates that for every on-farm dairy job, an additional 1.3 jobs are created in the processing and service sectors for a total of 2.25 million jobs generated by the entire Kenyan dairy industry in 2012. This would represent employment for around 13.5 percent of the country’s labour force.