As growers many of you have likely gone to your bank or other financial institution and found many new, young faces. The account officers or relationship managers that you or your parents have done business within the past are no longer there. This can be very unsettling, as for most of us it is human nature to be comfortable with consistency and familiarity. The problem is the “Baby Boomer” generation is retiring at a very rapid rate and thus leaving you in the hands of younger, less experienced personnel. The coronavirus pandemic has accelerated the Boomer retirement rate by 3.2M over 2019.
To make matters worse in the 1990s and early 2000s when ag financial institutions should have been hiring replacements for eventual retirement of these Boomers, the ag account officer type positions were not being pushed by university counselors and therefore these institutions found themselves with a shortage of young employees willing to be mentored by the exiting Boomers for the next several years. Therefore, a gap developed between the older, retiring Boomers and now the very young job seekers from about 2010 to today.
Many of these Baby Boomers likely grew up on farms and transitioned into ag finance out of necessity as farm positions became less available over the years. Along with them came that hands-on experience was not available to subsequent generations.
The result is today we have a much younger college educated workforce with ag business, or similar degrees, with minimal or no actual farm employment experience. Some may have advanced degrees as well. They have organizational, analytical, and technical skills that leave many (not all) Boomers in the dust. We must take advantage of those skills and learn from them.
So, what does this mean for the future of agricultural finance experience from the borrowing side or the lending side. We cannot change the past and no good ol’ boy lenders are going to magically start appearing at your local bank. Therefore, we owe everyone involved, the financial institutions, their employees, the borrowers, and all of us involved in agriculture to educate these young lenders.
I am sure you may be asking what can I do as borrower? Be patient with these young lenders and take every opportunity to educate them about all your crops, livestock or ag business and the details of how your business operates. Will there be some silly questions – maybe? Keep in mind none of us knew everything right out the gate, but we eventually learned. Speaking from personal experience I may have learned more from my borrowers over the years than any other group. So do not sell your educating skills short.
Those of us lenders in senior positions have the same obligation to mentor these young financial institution employees rather they work for our organization or someone else’s. The future of agricultural finance depends how well we accomplish this today.
If you’re ready to refinance or make your next land purchase and have questions, start the process by contacting a Conterra Ag Capital lending specialist today.
