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Spotlight on Economics: Occupational Safety at Agricultural Cooperatives

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Erik Hanson, assistant professor, NDSU Agribusiness and Applied Economics Department (NDSU photo) Erik Hanson, assistant professor, NDSU Agribusiness and Applied Economics Department (NDSU photo)
Improved occupational safety may yield business benefits for agricultural cooperatives.

By Erik Hanson, Assistant Professor

NDSU Agribusiness and Applied Economics Department

As the harvest season approaches, attention once again will focus on the occupational safety hazards agricultural producers face during this busy time of the year.

Dangerous machinery, heavy workloads and fatigue contribute to elevated farm injury rates in the late summer and fall months.

The harvest season also is a stressful time for agricultural cooperatives, which provide inputs and services vital to America’s agricultural economy. A survey of several agricultural cooperatives in the upper Midwest indicates that injuries are more common during the harvest season than other times of the year. However, compared with the dangers farmers face, the safety hazards at agricultural cooperatives receive relatively little publicity.

From 2012 to 2017, surveyed agricultural cooperatives averaged more than six injuries per 100 full-time workers per year, a rate roughly double that of U.S. private industry. As a result, many agricultural cooperatives are attempting to improve safety performance.

The most basic motivation for improving occupational safety is an altruistic desire to improve employee well-being. Beyond that, safety directors at surveyed agricultural cooperatives cited better business operations as a key motivation for improving safety performance. Specifically, safer workplaces have fewer work stoppages and worker re-trainings caused by occupational injuries.

Safety directors also value workplace safety because it assists in employee retention. That is, safe workplaces are more desirable for long-term employment. Retaining talent is key for all businesses, particularly those in rural areas. These and other financial benefits can add up for agricultural cooperatives, thereby boosting returns to their owner-members.

So what is standing in the way of improved safety performance at agricultural cooperatives? Many firms have made investments in safety equipment, training and personnel in recent years. However, at this point, safety directors indicate that insufficient firm resources are not necessarily the biggest obstacles to improved safety.

Managers’ motivation to comply with policies and procedures was identified as a driver of strong safety performance. Considerable research supports the view that managerial actions and attitudes are key to developing a strong “safety culture.”

Safety directors are focused on increasing accountability rather than simply increasing funding for safety training or education. In other words, internally imposed consequences for occupational health and safety incidents are critical for improving safety outcomes.

Internally imposed consequences include warning systems, financial penalties and even termination for failure to adhere to firm safety rules. Because managers must administer these penalties, the importance of safety-first managerial attitudes is once again evident.

Unfortunately, as agricultural cooperatives increase their workload to meet harvest demands in the coming weeks and months, on-the-job injuries are likely to occur. However, this stressful time should remind agricultural cooperatives of safety’s importance.

What is worth remembering is that attempts to enhance the effectiveness of safety investments may reap rewards not just for individual employees, but also for firm finances.


NDSU Agriculture Communication - Aug. 8, 2018

Source:Erik Hanson, 701-231-5747, erik.drevlow.hanson@ndsu.edu
Editor:Ellen Crawford, 701-231-5391, ellen.crawford@ndsu.edu
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