by Buddhadasa Hewavitharana
Labour Economics Series
Employment in non-farm activities has become an important aspect of the lives of a large number of people in the rural areas of Sri Lanka as in several other developing countries. While this is basically an economic phenomenon, it has an important social aspect because those affected are mostly the rural poor. For the growing numbers of these people who are not being absorbed fast enough in agriculture or in urban-based industry, and are actually obliged to leave the land partially or fully, non-farm activities are perforce a part of their personal survival strategies. The pattern of employment that has so resulted is as complex as the conditions and factors that have given rise to this variety of activities. Analytically, the resultant employment situation signifies structural impoverishment and current trends point to its possible deepening. It is in this setting that rural non-farm (r n-f) employment has emerged in Sri Lanka, as in certain other developing countries, as a theme around which study, analysis and action can be organised. Yet, a fuller understanding of the issues has been hampered by a paucity of data and a failure to develop appropriate perspectives.
This paper which is structured in seven sections attempts to develop some useful perspectives, to provide a better understanding of the issues by assembling and interpreting a wealth of data found scattered in numerous sources, and to present a strategy for the promotion of r n-f employment. Sections one and two, which focus on the macro-level issues, analyse the evolution of the r n-f sector and forecast its likely course in terms of its underlying factors. Sections three and four move on to the micro and household levels to observe how the r n-f sector currently operates by analysing patterns of activities, their determinants and the characteristics of family labour participation in the sector. Section five analyses structural patterns and focuses on structural changes and trends over time, while section six delves into the critically important demand-side issues. Section seven works towards a demand-led development strategy, which is theoretically well-grounded and practically feasible, for the r n-f sector.