Growth of Rural Non-Farm Employment in India: Pre and Post Reform Trends and Patterns

In India rural employment is considered to be equivalent to employment in agriculture. Over the years, the rural non-farm sector has been gaining importance in providing gainful employment and additional income opportunities to the growing rural workforce. Occupational diversification away from farm activities, that is, agriculture and allied activities in favour of rural non-farm activities has generated a lot of interest among researchers; therefore it is interesting to understand the status and growth of rural non-farm employment in India. The present study investigates the pre- and post-reform period trends and patterns of the rural non-farm sector employment in India and reveals that the sector has grown over a period of time both in terms of generating additional employment opportunities for the rural workforce and also in its share as a part of rural Net Domestic Product, especially after the reforms, which provides evidence that the sector has a significant potential for growth in the future. As India is still struggling to move rural workers away from agriculture, it becomes necessary to make rural non-farm activities lucrative enough to attract the growing rural workforce. Analyzing the barriers of entry into this sector employment and also the different activities undertaken in each state or region plays an important role in evaluating the quantum of employment in the rural non-farm sector.