Economic Impact of Organic Production Systems

From the National Research Council recent report Toward Sustainable Agricultural Systems in the 21st Century come these factoids related to the economic impact of organic productions systems:

... Production costs per acre for the organic system were lower. Total labor for the organic system was higher, but because it was spread more equally through the growing season, the organic system had fewer off-farm hired workers.
- p. 228

... despite the lower yields of organic crops compared to conventional crops, organic systems can still be more profitable than conventional systems because of lower input costs and organic price premiums. When organic premiums were not included, conventional systems were generally more profitable.
- p. 229

... Organic practices tend to be more labor intensive (Klepper et al., 1977; Pimental et al., 2005) and often need more intensive management time (Porter et al., 2003) than conventional agriculture. In general, unpaid family members provide a larger proportion of the overall farm labor (Tegegne et al., 2001; Macombe, 2007; MacRae et al., 2007). As a result, the economic performance of organic farming systems can depend heavily on the input costs attributed to unpaid family labor (Hanson et al., 1997; Brumfield et al., 2000).
- p. 229

So, to push forward some discussion points:

• Organic production systems may create year round jobs better than conventional systems, thereby assisting the stability and growth of rural communities.
  
• Some organic producers may be profitable because they receive free labor.
  
• Organic needs a price premium in order to achieve profitability, to cover the additional labor costs (and other costs?). A price premium of 10% may be the magic number, but this is determined by the market pricing.
  
• Hiring people is always seen as a drain on the bottom line; however what we need is job creation.

Can we consider that hiring and paying people to work is good business?