Determinants of off-farm employment in eastern rural Nepal

Stagnant agricultural productivity and low returns in farming have led rural residents in Nepal to look elsewhere for alternative or supplemental income opportunities, primarily though off-farm employment. Off-farm employment provides supplemental income to support household expenditure. This study examined the contribution of off-farm employment to total household income for two ecologically distinct districts of Eastern Nepal and identified factors differentiating households with on-farm, off-farm and, both on-and off-farm labour. Variables that differentiated wage labour, skilled labour and trade employment were determined. Participatory rural appraisal workshops (n=6), key informant interviews (n=9) and household socio-economic surveys (n=150) were used to gather data. The lacks of productive land, increased household sizes and higher educational attainment of household members were all positively associated with off-farm employment. There were fewer employment opportunities in locations away from major market centres and for women and disadvantaged groups. The Brahmin/Chhetri/Newar ethnic group dominated most of the off-farm employment opportunities. The study suggests that policy intervention measures such as the provision of irrigation and skill-based training would improve the well-being of rural women, disadvantaged people sub-groups and those located away from major employment centres. Market linkages are also an important factor in increasing off-farm employment opportunities and thus household income.