The role of rural non-farm employment in Philippine development

Abstract

Increasing interest in rural non-agricultural development, especially among researchers and policymakers, has brought about an increased awareness of the significance of rural non-farm employment in development. Consequently, in most developing economies, the development of rural non-farm activities has become an integral part of their general development program. It is even considered an alternative to past development strategies which failed to generate employment, improve income distribution, and alleviate poverty. There are various reasons for this increasing interest. Binswanger (1982) cites the following: 1. An apprehension that the agriculture and the urban industrial sectors may not be able to provide sufficient employment opportunities for rapidly growing labor forces in many parts of the developing world. 2. A concern about alleviation of poverty in regions with limited agricultural potential and rapidly growing population. 3. A concern about creation of employment opportunities to avoid apparent or real excess urbanization. 4. A concern about the decline of rural crafts and, correspondingly, of income-earning opportunities, which accompanies the transformation of subsistence-oriented economies into exchange economies. Ho (1986) suggests that the non-farm sector has become important in recent years because economic development based on large-scale, urban-concentrated, and capital-intensive industries has not provided the desired impact on employment and equity. At the same time, Shand (1983) argues that there are "severe limitations on the capacity of the agricultural sector to absorb the existing supply of rural labor and to satisfy even the minimum subsistence requirements of a large proportion of the rural population."