Rural Non-Farm Sector Employment in India: Distress Driven or Growth Driven? Vinoj Abraham Centre...
Transcript of Rural Non-Farm Sector Employment in India: Distress Driven or Growth Driven? Vinoj Abraham Centre...
Rural Non-Farm Sector Employment in India:Distress Driven or Growth Driven?
Vinoj AbrahamCentre for Development Studies
Trivandrum, kerala
INTERNATIONAL CONFERENCE ON EMPLOYMENT OPPORTUNIES AND PUBLIC EMPLOYMENT POLICY IN GLOBALISING INDIA ,TRIVANDRUM:
3RD- 5TH APRIL, 2008
• Background
• Trends in rural employment
• Patterns of rural non-farm employment
• Distress in agriculture and RNFE
• Determinants of employment in RNFS
Background
• Structural transformation in india’s output but not in employment
• Transformation in employment and income from agro based rural economy to industry based urban economy is associated with a vibrant RNFS.
• Performance of RNFS is strongly related to agriculture sector
Background
• A highly productive agriculture sector generates a vibrant RNFS , which is growth driven.
• A stagnant agriculture sector coexists with a low value adding RNFS that is residual of farm sector.
• What about INDIA?
Trends in rural employment
• Some positive trends in 61st round NSS Report
– Both LFPR and WPR had increased after nearly a decade of jobless growth
– Rise of self employment and decline of casualisation
– intersectoral mobility of male workers increased
• Can distress lead to employment increase?– Yes , under certain conditions– When income from the main bread winner of
the household does not meet even basic needs then the usually dependent members of household may join Labour force.
1. female LFPR, after declining continuously since the peak in 1987-88, rose for the first time in 2004-05 to 24.9
percent. 2. Moreover, this rise is the largest between any two NSS
thick rounds, from 23.5 to 24.9 percent
Female LFPR
0
50
100
150
200
250
300
1983 87-88 93-94 99-00 2004-05
Female Female above 60
increment in LFPR -99-00 to 04-05
-40 -20 0 20 40 60
5-9
15-19
25-29
35-39
45-49
55-59
persons
female
male
Change in WPR 99-00 to 04-05
-40 -20 0 20 40 60
5-9
15-19
25-29
35-39
45-49
55-59
persons
female
male
under employment in rural india
0
1
2
3
4
5
6
7
8
9
10
1983 87-88 93-94 99-00 04-05
RM_PS+SS
RM_CDS
RF_PS+SS
RF_CDS
growth of real wages in rural india
0 1 2 3 4 5 6 7
male
female
Persons
male
female
Persons
Reg
ular
Cas
ual
1999-2004
1993-1999
1983-1993
Share of RNFS in Rural India
22.826.1 26.3
28.833.8
13.817.5 15.3 15.9
18.6
0
10
20
30
40
1983 87-88 93-94 99-00 04-.05
Male RNFS Female RNFS
status of rural male employment (%)
0
100
200
300
400
500
600
700
Self-Employ Regular Casual
Rural Male
1993-94
1999-00
2004-05
status of employment - male- secondary sector (%)
0102030405060
Self-Employed Regular Casual
Secondary sector 1993-94 Secondary sector 1999-00
Secondary sector 2004-05
RNFS-concepts
• Rural non- farm sector employment is defined as any form of employment other than farm employment in the type of wage, self, or unpaid family labour.
• Farm employment is taken to be those agricultural activities such as• growing of crops ;• market gardening; horticulture ( NIC 011)• farming of animals (NIC 012)• mixed farming ,i.e., both crops and animal farming combined (013); • agricultural and animal husbandry service activities (NIC 014);• hunting and related services (NIC 015)
Data used
• Household level data of 61st NSSO round on employment-unemployment
• number of observations -145443 individuals in 62056 households.
• After cleaning -145359 observations in 62016 households.
• All tables generated below and the analysis done is based on this dataset.
RNFE and Gender
Sector of Employment by Gender - Share
Female Male Total
Farm employment 37.61 62.39 100
Non-farm employment 22.13 77.87 100
Gender by Sector of Employment - Share
Female Male Total
Farm employment 72.18 55.02 60.43
Non-farm employment 27.82 44.98 39.57
100 100 100
Distress in Farm Sector and Employment
Patterns • we divide the regions into agriculturally distressed and
non-distressed regions
• GoI (2007) ‘Report of the Expert Group on Agricultural Indebtedness’, Department of Economic Affairs, Ministry of Finance, Government of India, July
• 100 distressed districts identified by the expert group is the distressed region. Non-distressed is the rest of the region
Feminization of work in distressed region
6455.5
78.31 75.7769.74
63.06
3644.5
21.69 24.2330.26
36.94
0
10
20
30
40
50
60
70
80
90
ND D ND D ND D
Farm Non-farm Total
Male
Female
Underemployment among UPS main workers
0
5
10
15
20
25
farm non-farm
total farm non-farm
total
Non-distressed region Distressed region
< than 1month
1 to 2 months
3 to 6 months
Share of workers by status
Non-Distress region Distressed Region
Farm Non-farm
Total Farm Non-farm Total
self-employed 38.45 39.35 38.81 29.55 39.29 33.18
employer 1.91 0.94 1.52 1.72 0.83 1.39
unpaid family worker 30.9 11.03 22.94 34.96 14.88 27.47
regular salaried/ wage employee,
1.59 27.79 12.09 0.79 24.02 9.45
casual labour: in public works
0.04 0.59 0.26 0.1 0.84 0.38
casual labour on other works
27.11 20.31 24.39 32.88 20.15 28.13
Total 100 100 100 100 100 100
Variables used in the logit model
sex female =0 Male =1 ,
Age Age of the workers
age2 Square of age
Edu_lit Illiterate = 0 Not illiterate , but has not attended a formal school
Edu_prim Priamry education
Edu_mid Middle education
Edu_sec Secondary education
Edu_high Higher education
Percap_landown Average Land owned by a household/no. of persons in the household
Percap_landcult Average Land cultivated by a household/no. of persons in the household
HH_size Size of the household
Soc_OBC General category = 0
Belonging to other backward classes
Soc_SC/ST Belonging to other scheduled castes and scheduled tribes
DETERMINANTS OF RNFE
• LOGIT MODEL
• Dependent variable – Employed in farm sector = 0– Employed in non-farm sector =1
The exercise is done for distressed and non-distressed region separately for four category of workers
Casual, regular, self employed, unpaid family workers
Effect of Gender on Prob. of RNFE(Male =1,Female =0)
0.533540.74261
0.91079
1.54736
-0.12242
-1.53367
0.420080.22733 0.25795 0.23465
-2
-1.5
-1
-0.5
0
0.5
1
1.5
2
NON-D Distress NON-D distress NON-D distress NON-D distress NON-D distress
Total Casual w ageemployment
Regular w ageemployment
Self employed Unpaid familylabour
Effect of AGE on Prob. Of RNFE
-0.0027
0.03762
0.0112
0.02166
-0.05494
0.07408
-0.0084
-0.03786
-0.01728
-0.00405
-0.08-0.06-0.04-0.02
00.020.040.060.08
0.1N
ON
-D
Dis
tres
s
NO
N-D
dist
ress
NO
N-D
dist
ress
NO
N-D
dist
ress
NO
N-D
dist
ress
Total Casual Regular Self employed Unpaid family
Age
age2
Education and RNFS - Casual
-0.2
0
0.2
0.4
0.6
0.8
1
Edu_lit Edu_prim Edu_mid Edu_sec Edu_high
Casual NON-D Casual distress
Education and RNFE - Regular
0
1
2
3
4
5
Edu_lit Edu_prim Edu_mid Edu_sec Edu_high
Regular NON-D Regular distress
education and RNFE -Self employment
0
0.2
0.4
0.6
0.8
1
1.2
1.4
Edu_lit Edu_prim Edu_mid Edu_sec Edu_high
Self employed NON-D Self employed distress
education and RNFE - unpaid family
0
0.10.2
0.3
0.4
0.50.6
0.7
Unpaid family NON-D
Unpaid family distress
Percap_landown and RNFE
-0.001
-0.0005
0
0.0005
0.001
0.0015
0.002NO
N-D
Distr
ess
NON-
D
distr
ess
NON-
D
distr
ess
NON-
D
distr
ess
NON-
D
distr
ess
Total Casual Regular Self employed Unpaid family
Percap_landcultivated and RNFE
-0.008-0.007-0.006-0.005-0.004-0.003-0.002-0.001
0
NO
N-D
Dis
tress
NO
N-D
dist
ress
NO
N-D
dist
ress
NO
N-D
dist
ress
NO
N-D
dist
ress
Total Casual RegularSelf
employedUnpaidfamily
HH_size and RNFE
-0.2
-0.15
-0.1
-0.05
0
0.05NO
N-D
Dist
ress
NON-
D
distre
ss
NON-
D
distre
ss
NON-
D
distre
ss
NON-
D
distre
ss
Total Casual Regular Self employed Unpaid family
social groups and RNFE(Gen cat = 0)
-0.6 -0.4 -0.2 0 0.2 0.4 0.6
NON-D
Distress NON-D
distress
NON-D
distress
NON-D
distress
NON-D
distress
Tota
lC
asual
Regula
r
Self
em
plo
yed
Unpaid
fam
ily
Soc_SC/ST
Soc_OBC