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Agriculture has historically been the backbone of Nebraska's economy, with cattle, corn, hogs, and soybeans leading the state's list of farm products. However, Nebraska is attempting to diversify its economy and has been successful in attracting new business, in large part because of its location near western coal and oil deposits. The largest portion of the state's labor force is employed in agriculture, either directly or indirectly—as farm workers, as factory workers in the food-processing and farm-equipment industries, or as providers of related services. The service sector, which includes not only the servicing of equipment but also the high growth areas of health and business services and telemarketing, expanded at an annual rate of 4.4 percent during the 1980s. The trend intensified in the late 1990s, as general services grew at an average annual rate of 7.7% 1998 to 2001, and financial services grew at an average rate of 5.7%. Nebraska was not deeply involved in the information technology (IT) boom of the 1990s, and therefore was not deeply affected by its bust in 2001. Coming into the 21st century, the state economy grew an a moderate average rate of about 4.1% (1998 to 2000), which fell to 2.4% in 2001. In 2001, declines in manufacturing employment were off-set by increases in the services and government sectors. The job losses became more severe in 2002, by the 8th quarter, the unemployment rate had eased to 3.3%, down from 3.9% in April 2002.

With technological advances in farming and transportation, and consolidation in the agricultural sector, Nebraska's rural counties have been losing population since the 1970s. In 2002, 66 of Nebraska's 93 counties had lower populations than in the 1970s, and in 21of these, population loss accelerated during the 1990s. Drought conditions in 2002 disrupted cattle production because of shortages of hay and pasture. Drought persisted into the winter of 2002–03, and the state is likely to face long-term water shortages.

Nebraska's gross state product in 2001 was $57 billion, the 36th highest among the states, to which general services contributed $11.5 billion; trade, $13 billion; financial services, $9 billion; government, $8.2 billion; manufacturing, $7 billion; transportation and public utilities, $6.3 billion, and construction, $2.7 billion. The public sector in 2001 constituted 14.4% of gross state product, above the average of 12% for all the states.