Determinants of non-farm employment in Punjab: Evidence from National Sample Survey Rounds

Abstract

There is growing consensus among the social scientist that for the development of rural economy, rural non-farm sector should be thriving. The present study is an attempt to study the factors enabling the rural households of Punjab to participate in the rural non-farm activities. In the present study, the household level data of National Sample Survey Organization’s employment-unemployment 50th round and 68th round is utilized. The rural households of Punjab are categorized into; self-employed, casual labourer, regular or salary earners and others in farm as well as non-farm sector. The logit regression model for both the rounds are utilised to study the factors impacting the participation as self-employed, casual labourers, and regular wage earners in rural non-farm sector. As compared to the year 1993-94, in the year 2011-12, the proportion of households earning their livelihood in rural non-farm sector has increased. Moreover, the proportion of casual labourer in rural non-farm sector has also increased. The choice of occupations among the self-employed, regular salary earners and causal labourer in the rural non-farm sector is also changing in Punjab. The factors like education, number of skilled members in the households, head’s education, household belonging to developed districts significantly impacted the choice of working in rural non-farm sector of Punjab. The study recommends that with increase in investment in education and developing the infrastructure in rural areas can develop the rural non-farm sector.