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Pesants, the most unequal of professions

Summary:
The French and European agricultural crisis has demonstrated that no sustainable development trajectory is possible without a drastic reduction in the social inequalities and glaring injustices of our economic system. Instead, the public authorities in Paris and Brussels are embarking on an old-fashioned headlong rush to relaunch pesticides and pollution, without giving themselves the means to tackle injustices and liberal dogmas. This is all the more ill-adapted given that the farming world today is the most unequal of all professional universes. No viable solution can be found without starting from this basic material reality. Let’s take a step back. In recent weeks, French public opinion has been struck by a widely shared statistic: The average annual income of farmers reached

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The French and European agricultural crisis has demonstrated that no sustainable development trajectory is possible without a drastic reduction in the social inequalities and glaring injustices of our economic system. Instead, the public authorities in Paris and Brussels are embarking on an old-fashioned headlong rush to relaunch pesticides and pollution, without giving themselves the means to tackle injustices and liberal dogmas. This is all the more ill-adapted given that the farming world today is the most unequal of all professional universes. No viable solution can be found without starting from this basic material reality.

Let’s take a step back. In recent weeks, French public opinion has been struck by a widely shared statistic: The average annual income of farmers reached €56,014 in 2022, a much higher level than sometimes imagined. The data, compiled by the Ministry of Agriculture’s statistical services for European comparison purposes, is also available at the most detailed level, by farm type and by income decile.

In order to interpret it correctly, however, several points must be taken into account. First of all, the study excluded some of the smallest farms. The Ministry specified that 95% of surfaces and 99% of production were covered. However, between 10% and 20% of farmers were excluded, depending on the sector.

Secondly, and most importantly, consider the concept of income used in the study. It is the average annual income per full-time farmer, after deduction of all operating expenses, including financial charges (loan interest) and equipment amortization charges, but before deduction of income tax and all social security contributions. This largely explains why the average income of €56,014 is so high.

If the average remuneration per employee (full-time equivalent) in France in 2022 is calculated, including all employee social contributions (deducted from gross salary) and employer social contributions (paid by employers in addition to gross salary), then we also arrive at an average of around €60,000 per year, close to that of farmers, or a little higher. With an equivalent concept, the average income of doctors reaches €120,000 per year (90,000 for general practitioners, 150,000 for specialists).

It’s true that farmers, like all self-employed people, have much lower social security contributions than salaried employees, so their average disposable income after deducting contributions is significantly higher. But these lower contributions also translate into lower pensions and other social entitlements, forcing farmers to save more to compensate.

Even more so than doctors and other self-employed people, farmers are also forced to tie up extremely large amounts of capital, which they can in principle sell when they retire, although this operation is not without risk. In the end, the farmers’ average income of €56,014 is in no way exorbitant when compared with the rest of the country’s working population.

What really sets farmers apart, however, is the extreme inequality of pay distribution around this average. According to the data available, farmers even appear to be the most unequal of all professions in France today. Generally speaking, pay inequalities within self-employed occupations are significantly higher than within salaried occupations, owing in particular to difficulties in accessing capital and equipment.

And among the self-employed, income inequalities are significantly higher among farmers than in other professions, such as shopkeepers, restaurateurs, bakers, transport and construction.

In concrete terms, for an average income of €56,014, according to the statistical services of the Ministry of Agriculture 25% of farmers exceed €90,000 and 10% exceed €150,000. Incomes of several hundred thousand euros a year are not uncommon, particularly among the current leaders of the FNSEA farmers’ union, who often combine their activity as a farmer-manager with that of a shareholder in the agro-industry.

At the other end of the scale, the lowest-paid 10% of farmers earn less than €15,000, in many cases well below the minimum hourly wage, given the long working days. There are also considerable differences between farm categories, with average incomes ranging from €19,819 for cattle and goat farmers to €124,409 for pig farmers, whose incomes have varied widely but have risen sharply over the last 30 years.

What can we conclude from all this? Firstly, that global solutions make no sense. Abolishing the tax on agricultural diesel or reintroducing pesticides will obviously bring in much more money for those already earning €150,000 than for those on €15,000. Secondly, that it makes no sense to respond to competition from foreign pesticides by reducing standards on French production.

A much better solution would be to immediately introduce safeguard measures aimed at making the imports concerned pay for the undue benefit they derive from non-compliance with French standards. It is by tackling the inequalities of the farming world and the challenges of organic farming head-on that we will emerge from the current crisis.

Thomas Piketty
Thomas Piketty (7 May 1971) is a French economist who works on wealth and income inequality. He is a professor (directeur d'études) at the École des hautes études en sciences sociales (EHESS), associate chair at the Paris School of Economics and Centennial professor at the London School of Economics new International Inequalities Institute.

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