A Comparative Study of Income and Employment in Farm and Non-Farm Sectors in Raipur District of Chhattisgarh

 

Dr. A.K. Pandey¹*, Dr. (Smt.) Radha Pandey², Dr. Ashok Sharma³

¹Professor, S.O.S. in Economics, Pt Ravishankar Shukla University, Raipur (C.G.)

²Principal, Govt. C.L.C. College, Patan, Dist. Durg (C.G.)

³Professor, Dept. of Commerce, Govt. Chhattisgarh College, Raipur (C.G.)

*Corresponding Author E-mail:- amarkantrsu@yahoo.co.in

 

INTRODUCTION:

In India, economic opportunities in the non-farm sectors have non-farm also increased.^* A comparative account of the sector in the rural vis-à-vis the urban sector however, shows significant disparity in terms of its size and growth.^** The lopsided nature of growth of the non-farm sector is causing a problem of rural - urban migration. The small base of the rural non-farm sector located within a large rural population is in fact indicative of the employment potential in the rural non-farm sector (RNFS).

 

The rural non-farm sector (RNFS) encompasses all non-agricultural activities: mining and quarrying, household and non-household manufacturing, processing, repair, construction, trade and commerce, transport and other services in villages and rural towns undertaken by enterprises varying in size from household own-account enterprises to factories.

 

Rural farm and non-farm employment play an important role in the economies of marginal, small, medium and large farmers under rain-fed rice production system of Chhattisgarh State. Non-farm income is an important source to the marginal and small farmers during slack period, because Chhattisgarh State is belonging to mono-crop rainfed rice production system. Instead of farm sector, non-farm sector is also facilitating to structural transformation for providing the non-farm goods to the farmers. Many studies have been conducted by researchers at country, state and regional levels to examine the significance of rural non-farm and on-farm employments, their trends and determinants. Thus, it becomes necessary to find out the significance of on-farm and non-farm employment in the context of mono-crop rainfed production system in Raipur district of Chhattisgarh State for formulation of appropriate policies. Hence, in the present paper, an attempt has been made to analyze the income and employment inequalities in on-farm and non-farm sectors amongst the farmers of different farm size categories

 

OBJECTIVES:

The objectives of the present paper are given as follows:

1.       To examine the income and employment pattern in rural non-farm and farm sectors in Raipur district of Chhattisgarh State.

2.       To analyze the income and employment in-equalities in non-farm and farm activities amongst the farmers of different farm size categories.

3.       To suggest some policy measures on the basis of findings of  the study.                                

 

RESEARCH METHODOLOGY:

The present paper is based on primary data collection. Informations regarding    income and employment of 200 sample households engaged in rural non-farm and farm sectors have been collected using pre-tested schedule.  The random sampling method was adopted for selection of villages and households. For the selection of farmers, 10 percent farmers from the total population of marginal      (<1 hect.), small (1-2 hect.), medium (2-4 hect.) and large (>4 hect.) farm size groups have been considered for the study. Thus, total sample households are 118, which comprises of 56, 30, 21 and 11 households under respective farm size groups.

 

For the analysis of data collected from field survey, simple average and percentage methods have been used for fulfillment of objectives of the study. Gini coefficient ratio has been calculated to estimate the contribution of income in-equalities amongst the sample households engaged in farm and non-farm sectors. Decomposition of Gini coefficient ratio is useful to identify the relative contribution of each income source to the overall inequality. For the decomposition of Gini coefficient, the pseudo Gini coefficients are multiplied by the income share to each source to the total income and summed overall sources of  income. The formula of Gini coefficient ratio is given below :

 

G = 1+ ( 1/n ) – 2 /  ( n2 µ ) ( 1Y1 + 2Y2 + 3Y2 +- -n Y²n ), Where:

Y1 = Highest income.

Y2 = Second highest income.

Y3 = Third highest income.            

Yn = Lowest income.

n  = Number of households and

µ = Mean income.

 

RESULTS AND DISCUSSION:

1.       Pattern of Employment by Gender: Table-1 presents the pattern of employment in rural non-farm and farm sectors.

 

Table – 1  Employment in Rural Non-farm and Farm Sectors ( in days/year/household )

Particular	Male	Female	Total	% of  Employment
Farm Sector	155.66 (58.36)	111.05 (41.64)	266.71 (100.0)	65.45
Non-farm Sector	138.01 (98.04)	02.76 (01.96)	140.77 (100.0)	34.55

Note: Figures in brackets show percentages to total.

 

 

 

Table-2 Employment Rate in Rural Non-farm and Farm Sectors (in %)

Employment in	All Farm Size		Total
	Male	Female
Farm Sector	21.43	19.93	41.36
Non-farm Sector	19.00	0.46	19.46
Total Employment	40.43	20.39	60.82

 

It has been observed that employment in farm sector was highest and found to be 65.45 percent followed by 34.55 percent in non-farm sector. Thus, agricultural employment (on-farm and of-farm employment) contributes nearly 2/3 employment during kharif season. Women work participation in non-farm employment was found to be negligible.

 

 

Table-3 Average Annual Income and Per Capita Income ( in Rs./year/household )

Source of Income	Farm Size Category
	Marginal	Small	Medium	Large	Total
Farm Sector	10149.50 (52.59)	6900.55 (43.36)	5476.20 (45.19)	12293.90(50.83)	8691.65 (53.800
Non-farm Sector	6067.20 (37.410	9015.20 (56.64)	6642.20 (54.81)	11890.90 (49.87)	7462.10 (46.20)
Total	16216.70 (100.0)	15915.75 (100.0)	12119.20 (100.0)	24184.80 (100.0)	16153.75 (100.0)
Per Capita Income	2804.07	2396.95	1470.76	2144.04	2341.12

   Note: Figures in brackets show percentages to total.

 

Table-4 Income Inequalities and Decomposition of Total Income

Farm Size/ Income Source	Income Share	Pseudo Gini Ratio	Contribution to Income Inequalities	Gini Concen. Ratio
Marginal Farm Non-farm	0.6763 0.3236	0.3195 0.4263	45.1800      54.8200	0.2571
Small Farm Non-farm	0.6675    ---	0.2543    ---	43.3100          ---	0.3380
Medium Farm Non-farm	0.7319 0.2681	0.1999 0.7603	41.7100      58.6700	0.3474
Large Farm Non-farm	0.7999 0.2001	0.2448 0.3786	72.1000      27.9000	0.2716
Total Farm Non-farm	0.7100 0.2899	0.3952 0.5181	59.0300      41.5800	0.3612

Note: Farm sector includes both on-farm and off-farm employment and on-farm income is sum of income by sources through on-farm employment and sale of farm products.

 

Analysis of data also shows that diversified job opportunities are available in rural areas by means of small scale industries, transportation, construction works, shopkeeping and other services, but it could not have been sufficient to provide the employment for all job seekers during slake period because Raipur district and Chhattisgarh State as a whole provide one season employment only.

 

2. Rates of Employment by Gender:

Table-2 presents the available labour force and rates of employment by gender in rural non-farm and farm sectors in Raipur district of Chhattisgarh State.

 

It is seen that the rate of employment in farm sector which includes both on-farm and off-farm activities is more (41.36%) when compared with the employment in non-farm sector which is only 19.46 percent. The proportion of employment among females in non-farm sector is lesser (0.46%) when compared with the proportion of male workers (19.0%). Thus, it can be said that a total of 60.82 percent labour force has got employment irrespective to the farm size categories and gender and remaining 39.18 percent labour force is found to be unemployed.

 

3.  Share of Income and Per Capita Income:

Share of income and per capita income through farm and non-farm employment of sample households in Rs. per year per household are presented in table-3.

 

It is observed that employment in farm sector which include both on-farm and off-farm employment has generated maximum income (Rs. 8691.65 / household) while non-farm sector has contributed Rs. 7662.10 / household. Hence, the rural non-farm employment is a major source of income. Table-3 also shows that the share of non-farm income is maximum (56.64% ) under small farm size category. The per capita income through farm and non-farm employment is decreasing across the farm size categories except large size category and found to be Rs. 2804.07, Rs. 2696.95, Rs. 1470.76, and Rs. 2144.04 under marginal, small, medium and large farm size respectively.

 

4. In-equalities in Income and Decomposition of Total Income: Table-4 presents income in-equalities and decomposition of total income by estimation of Gini coefficient ratio and pseudo Gini coefficient.

 

Table-4 reveals that the contribution of on-farm income is increasing with the increase of farm size category. The study also shows that on-farm income contributes more percentage of income to the total income inequalities in large farm size category. It is, because of more crop income earned through sale of farm produce than that of marginal small and medium farm size categories of farmers. These three categories of farmers are earning more income through non-farm employment which has contributed major source to income inequalities.

 

FINDINGS:

The present study reveals that 60.82 percent labour force has got employment irrespective to the farm size categories and remaining 39.18 percent labour force is found to be unemployed. It creates the personal hardship among the rural labour force and also indicates unhealthy economy of Raipur district and Chhattisgarh State as a whole. Thus, it is being suggested to the Government of Chhattisgarh to encourage the public and private investments for the establishment of rural based industries. The study also finds that the proportion of female workers who have got employment in non-farm sector is lesser when compared with the male workers. Hence, to increase women labour participation in non-farm employment, establishment of women based small scale industries and cottage industries should be established. In conclusion, it can be said that although, agriculture plays a leading role in the generation of employment in rural areas of Raipur district and diversified job opportunities are available , but these are not sufficient to generate the non-farm employment. So, it should be strengthen through promotion of agro-based industries.

 

^*Though proportion of household income separately available from the agriculture and non-agriculture sector varies across regions, the studies have generally found that non-farm activities on an average contribute between 25 and 35 percent of the total household income in rural India.

^**The non-farm sector is loosely referred to as the unorganized sector; and the Ninth Five-Year Plan document says that more than 90 per cent of employment growth during the 1990s was from the  unorganized sector.

 

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