Rural Non-farm Employment in Uttar Pradesh: A Regional level study based on NSSO and PLFS Data

Abstract

Abstract The study examines the drivers of rural non-farm self-employment in Uttar Pradesh, India. The state has considerable regional diversity in the structure and growth of the rural non-farm sector (RNFS), which is the main driver of job growth in the rural economy. The western region is one of the fastest expanding regions, while the southern region has lagged behind. The study uses a multinomial logit model to analyze the determinants of non-farm employment across different regions. The analysis highlights regional differences within the state and makes an effort to account for these differences. The study concludes that the variables influencing the rise in non-farm employment vary across regions, with demand-pull factors playing a role in the western region and distress-push factors in the central and southern regions. In Uttar Pradesh, we observed that a higher proportion of the casual workforce and stagnation of rural manufacturing activities are more pronounced in the southern region of the state compared to the western part, which all contributed to the casualization of the rural workforce. It is also found that a significant number of educated, landowning, and socially dominant caste people were diversifying their employment in the rural non-farm sector in western Uttar Pradesh, whereas such transitions were nonexistent in the southern region. JEL Classification: R11, J21, J24