Description

Indicator is used to monitor progress towards SDG 2 on ending hunger and malnutrition; which is embedded in the European Commission’s 2024-2029 Priorities under ‘Sustaining our quality of life: Food security, water and nature’. Agricultural real factor income measures the income generated by farming, which is used to remunerate borrowed, rented or own factors of production (capital, labour and land). Annual work units (AWUs) are defined as full-time equivalent employment (corresponding to the number of full-time equivalent jobs), which is calculated by dividing total hours worked by the average annual number of hours worked in full-time jobs within the economic territory. This can be interpreted as a measure of labour productivity in agriculture. The data stem from the Economic Accounts for Agriculture (EAA), which provide detailed information on agricultural sector income.
Rationale

SDG 2 aims to ensure access to safe, nutritious and sufficient food. Improving agricultural productivity and the incomes of food producers are key factors in achieving this goal. Data source is Economic accounts for agriculture (EAA) using agricultural statistics plus administrative information. The EAA are satellite accounts of the European System of Accounts, providing complementary information and concepts adapted to the particular nature of the agricultural industry. Although their structure very closely matches that of the national accounts, their compilation requires the formulation of appropriate rules and methods.
Content and progress

One of the five general objectives of the Common Agricultural Policy (CAP) is to ensure a fair standard of living for farmers. The CAP is financed by two funds: the European Agricultural Guarantee Fund (EAGF), which finances direct payments to farmers as well as market measures, and the European Agricultural Fund for Rural Development (EAFRD) under which rural development programmes are financed. EU subsidies and direct payments have become an important share of the agriculture factor income.
Long-term objective

to enhance the productivity and profitability of the agricultural sector through:

  • Increasing real factor income
  • Reducing agricultural labor
  • Stabilizing agricultural income
Back to top