Technological innovations have allowed a gradual change to take place in dairy farm organization and management practices. Improved breeding and feeding have resulted in a steady rise in production per cow, and labor-saving devices have allowed herd size to expand. With new techniques in housing, feeding and milking, the possibility exists for one laborer to handle a larger number of cows. The result can be an increase in labor productivity.

In recent years, however, the cost of labor and capital has risen more rapidly than the price of dairy products. A c03t-price squeeze has occured in dairying, as it has in most other types of Midwest farming. For the majority of dairy farmers in Iowa and throughout the nation, over-all change in organization and in the scale of enterprise has been too slow to keep pace with rising costs. Consequently, returns to resources in dairying-particularly to labor-are lower than in many other types of farming.