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The growth and variations of rural non-farm activities in Sri Lanka since independence Hasbullah, Shahul Hameed 1989

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THE  GROWTH AND VARIATIONS OF RURAL NON-FARM ACTIVITIES IN SRI LANKA SINCE INDEPENDENCE  by SHAHUL HAMEED HASBULLAH B.A., U n i v e r s i t y of Peradeniya, M.A., U n i v e r s i t y of B r i t i s h  S r i Lanka. Columbia.  A THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE  REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY  in THE  FACULTY OF GRADUATE STUDIES DEPARTMENT OF GEOGRAPHY  We accept t h i s t h e s i s as conforming to the required  THE  standard  UNIVERSITY OF BRITISH COLUMBIA OCTOBER 1989  (c) Shahul Hameed Hasbuilah, 1989  In  presenting this  degree at the  thesis  in  partial  University of  fulfilment  of  of  department  this thesis for or  by  his  requirements  British Columbia, I agree that the  freely available for reference and study. I further copying  the  her  representatives.  an advanced  Library shall make it  agree that permission for extensive  scholarly purposes may be  or  for  It  is  granted  by the  understood  that  head of copying  my or  publication of this thesis for financial gain shall not be allowed without my written permission.  Department The University of British Columbia Vancouver, Canada  Date  DE-6 (2/88)  |?  Ay*>L>S*-  Abstract The as  encouragement of  part  of  a  alternative Countries  the  general  strategy (LDCs).  agricultural rural  countries.  A  of  shift to  LDCs  activities  in  of  from  labour  (RNA),  programme,  progress  is  an  Less  Developed  low  productive  n o n - a g r i c u l t u r a l employment could  T h i s t h e s i s focuses  of a Less Developed Country and of RNA  non-farm  development  for  employment  areas  rural  enhance on  incomes  S r i Lanka as  analyses  in  an  in  those  example  the growth p a t t e r n  from S r i Lanka's independence i n 1948  t o the  present  day. The  t h e s i s poses s e v e r a l q u e s t i o n s . Why  changes slow d u r i n g variations  in  contributed  the  to  the  last  regional  the  scheme of RNA these  f o u r decades? Why growth  patterns  r e g i o n a l growth i n RNA? growth and  were employment  of  of  RNA?  spatial  were  What  factors  distribution  T h i s t h e s i s proposes a  and  conceptual  t e s t s s e v e r a l hypotheses t o answer  questions. Data used i n t h i s t h e s i s were d e r i v e d from t h r e e  of magnitude: (village). obtained (  there  macro The  from  ( n a t i o n a l ) , meso ( r e g i o n a l ) ,  macro  and  secondary  meso  1986  Statistical  and  1987.  Package  The for  survey data  Social  U n i v e r s i t y of B r i t i s h Columbia.  and  micro  information  sources.  i n f o r m a t i o n came from a f i e l d during  level  levels  The  micro  were level  conducted i n S r i Lanka  were  analysed  Science  using  (SPSS:X)  at  the the  The  thesis  finds  regionally  and  occupational  c a t e g o r i e s . The  by  low  is  that  levels  second  of  category  persons  with  the  growth  concentrated  often  higher  city  of  Colombo  varies  contrasting  and  income.  government-related  status  and  two  skills  and  and  education.  s i g n i f i c a n t growth i n both types was the  RNA  f i r s t category i s c h a r a c t e r i z e d  productivity, is  in  of  The  employs  Regionally  seen i n f r i n g e a r e a s of  i n areas  of  state  investment  for  a g r i c u l t u r a l development. RNA  growth was  structure  of  1950s and  1960s which  1970s.  Slow  the  l a r g e l y due population.  the  to  the  open  changes  Population  led to  rapid  expansion  of  grew  labour  s t r u c t u r a l change and  economy r e t a r d e d leading  to  force  i n the  age  rapidly  in  growth  in  poor performance employment  unemployment,  of  the  opportunities  under-employment  and  landlessness. Household areas.  employment  The  increased  households  encouraged  RNA.  The  middle  facilities  and  strategies  labour  part-time, upper  provided  force  by  the  providing  rural  people,  opportunities agricultural  and  social by by  the  Lankan governments  and  low  income  seasonal  and  low  paying  in  the  economic w e l f a r e  the  educational rural  areas  occupations.  encouraging  influenced  rural  the  state  areas,  the  among  expanding the  development  in  income groups u s i n g  q u a l i f i e d f o r government r e l a t e d By  varied  benefits  state sector migration  the  of  employment labour  post-independence  employment  for  situation  to Sri and  the  growth  creation because  of RNA.  of RNA  RNA  Direct has  not  consequences.  considerations Therefore,  a n a l y s i s of S r i Lanka's RNA develop p o l i c y  o t h e r LDCs.  always  expansion i s a l s o  and p o l i t i c a l  to  government  intervention  had  the  influenced  f o r the  desired  by s o c i a l ,  effect ethnic  which o f t e n  l e a d t o unexpected  conclusions  derived  growth alone may  prescriptions  f o r the  not be  from  the  adequate  implementation i n  T a b l e o f Contents Abstract  i i  L i s t of Tables  vi  L i s t of Diagrams  ix  Acknowledgments  xi  Chapter One:  Introduction  1  Chapter Two:  The Conceptual and M e t h o d o l o g i c a l Issues i n the Study of R u r a l Non-Farm Employment  Chapter Three: R u r a l Non-Farm A c t i v i t i e s i n A s i a , 1950-1980 Chapter Four:  Chapter F i v e : Chapter S i x :  The S t r u c t u r a l Changes i n Economy and Employment i n S r i Lanka s i n c e Independence  29 60  97  The Growth of R u r a l Non-Farm A c t i v i t i e s i n S r i Lanka  161  The S p a t i a l D i s t r i b u t i o n of R u r a l Non-Farm A c t i v i t i e s and the V a r i a t i o n s i n t h e i r R e g i o n a l Growth i n S r i Lanka  208  Chapter Seven: Case Study: RNA  i n Ketakumbura  Grama  Sevaka D i v i s i o n of Kandy D i s t r i c t  2 68  Chapter E i g h t : C o n c l u s i o n  317  Bibliography  323  Appendix One  3 60  Appendix Two  368  Appendix Three  373  L i s t o f Tables l.la 1.1b 1.2 3.la 3.1b 3.2 3.3 3.4 3.5 3.6 3.7 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 5.1 5.2 5.3 5.4  P o p u l a t i o n by R e l i g i o u s Groups, 1981 12 R e l i g i o u s Composition o f E t h n i c Groups, 1981 12 The Changes i n S o c i a l I n d i c a t o r s During t h e Post-independence P e r i o d i n S r i Lanka 21 Economic and Demographic I n d i c a t o r s f o r S e l e c t e d C o u n t r i e s i n A s i a ( S e l e c t e d Years) 62 The F a c t o r s a s s o c i a t e d with RNA i n A s i a 63 Employment C o n d i t i o n s i n LDCs, 1960-1980 73 Rates o f Employment Change by s e c t o r s i n S e l e c t e d A s i a n C o u n t r i e s , 1960-80 74 Percentage o f R u r a l Persons Who Consider RNA as T h e i r Main Source o f Income i n S e l e c t e d Asian Countries 77 The Share o f Off-Farm Income o f Farm Households i n East A s i a 81 R e l a t i v e C o n t r i b u t i o n of t o Family Income o f D i f f e r e n t Income Sources i n R u r a l I n d i a 81 Share o f D i f f e r e n t C a t e g o r i e s of RNA i n S e l e c t e d South and Southeast A s i a n C o u n t r i e s 86 S e c t o r a l D i s t r i b u t i o n (%) o f Gross Domestic Product (GDP) i n S r i Lanka - 1961, 1973, 1980 and 1985 99 The D i s t r i b u t i o n and Change i n Employment by S e c t o r s , S r i Lanka - 1953, 1971 and 1981 102 A b s o l u t e Change i n Employment i n R u r a l and Urban Areas by Industry d i v i s i o n , 1971-81 104 Growth r a t e s o f P o p u l a t i o n and Labour Force and Changes i n A c t i v i t y Rates, Census Years A f t e r 1953 106 Changes i n Labour Force, Employed and Unemployed P o p u l a t i o n , 1953-1981 107 Ten I n d u s t r y D i v i s i o n s i n Ranking Order (3 D i g i t a l Group) Which Show Increase i n T o t a l Employment, 1953-71 and 1971-81 117 Ten I n d u s t r y D i v i s i o n s i n Ranking Order (3 D i g i t a l Group) Which Show D e c l i n e i n T o t a l Employment, 1953-81 and 1971-81 133 Employment Change i n R u r a l Manufacturing S e c t o r (3 D i g i t a l Group), 1971-1981 ...147 Estimated Unemployment (% of Labour Force) i n S r i Lanka, 1962 - 1982 154 The D i s t r i b u t i o n and Change i n Farm and Non-Farm Occupations i n t h e R u r a l Areas o f S r i Lanka 1963-1981 164 R u r a l Employment Change by Major O c c u p a t i o n a l C a t e g o r i e s , 1971-1981 166 S i x t e e n O c c u p a t i o n a l C a t e g o r i e s (2 D i g i t a l Group) Absorbing Nearly 90 Per Cent o f T o t a l Employment I n c r e a s e During 1971-1981 168 O c c u p a t i o n a l C a t e g o r i e s i n Which 90 p e r cent of Employment Growth Occurred i n R u r a l areas, 1971-81 (Re-Grouped Using Table 5.3) 170  5.5 5.6 5.7 5.8 6.1 6.2 6.3a 6.3b 6.4 6.5 6.6 6.7 6.8 6.9 6.10 6.11 7.1 7.2 7.3 7.4 7.5 7.6 7.7 7.8  Ten O c c u p a t i o n a l c a t e g o r i e s i n Ranking Order Which Showed D e c l i n e i n T o t a l Employment, 1971-1981 173 Average Monthly Income (Per Person) by Major O c c u p a t i o n a l C a t e g o r i e s , 1981/82 176 Highest and Lowest Income R e c e i v e r s by Occupations (2 D i g i t a l Group) i n R u r a l Areas, 1981/82 177 The Expansion of State Sector A c t i v i t i e s and Growth i n Employment, S e l e c t e d Years 192 The percentage o f Employed P o p u l a t i o n Engaged i n Non-Farm A c t i v i t i e s by D i s t r i c t , S e l e c t e d Years 211 R u r a l Non-Farm Employed by W h i t e - C o l l a r , B l u e C o l l a r and S e r v i c e Occupations, 1981 213 RNA and R e l a t e d V a r i a b l e s by A g r o - E c o l o g i c a l Zones, 1981 214 RNA Growth and R e l a t e d V a r i a b l e s by AgroE c o l o g i c a l Zones, 1953-1981 214 The Percentage Changes i n Employment by D i s t r i c t , 1963-71 and 1971-81 216 R e l a t i o n s h i p s Between S e l e c t e d Demand and Supply F a c t o r s (1981) and t h e S t r u c t u r e o f RNA i n 1981....221 M u l t i p l e Regression A n a l y s i s of S e l e c t e d Demand and Supply F a c t o r s i n 1981 and S t r u c t u r e o f RNA i n 1981 221 R e l a t i o n s h i p s Between S e l e c t e d Demand and Supply F a c t o r s and t h e Growth o f RNA , 1963-1981 225 M u l t i p l e Regression A n a l y s i s o f S e l e c t e d Demand and Supply F a c t o r s and t h e Growth of RNA, 1963-81 225 RNA Growth Regions 230 The Changes i n RNA arid t h e Background v a r i a b l e s by Re-Grouped d i s t r i c t s 231 S e l e c t e d Independent v a r i a b l e s by Re-Grouped Districts 232 The Increase o f R u r a l Establishments i n t h e Study Area 283 Employment S i z e o f t h e Surveyed E s t a b l i s h m e n t s i n t h e Study Area 283 The Changes i n Type of R u r a l I n d u s t r i e s and Employment i n t h e Study Area 285 The Changes i n Type of R u r a l Commercial E s t a b l i s h m e n t s and Employment i n t h e Study Area 285 The Growth o f Employment i n R u r a l E s t a b l i s h m e n t s 1948-1987 296 D i s t r i b u t i o n o f Male, Female and C h i l d r e n Employed i n t h e Surveyed R u r a l Establishments 296 The O c c u p a t i o n a l D i s t r i b u t i o n o f S e l e c t e d Households Heads 3 01 Employment H i s t o r y o f the Heads o f the Households 301  7.9 7.10  The Main and Other Occupations o f t h e Heads o f t h e Households S e l e c t e d f o r t h i s Study Other Sources of Income and Income L e v e l s o f the S e l e c t e d Households  305 305  L i s t o f Diagrams 1.1 1.2 2.1a 2.1b 4.1 6.1 6.2 6.3 6.4 7.1 7.2 7.3 7.4 7.5 7.6 7.7 7.8  A g r o - e c o l o g i c a l Regions of S r i Lanka P o p u l a t i o n D i s t r i b u t i o n by D i s t r i c t , 1981 Conceptual Scheme of RNA Growth The Role of S t a t e i n RNA Growth The S t r u c t u r a l Change i n P o p u l a t i o n , 1950-80 S r i Lanka: A d m i n i s t r a t i v e D i s t r i c t s at the Time of 1971 Census The D i s t r i b u t i o n of Re-Grouped D i s t r i c t s by RNA Growth Regions ' L i f e - T i m e M i g r a t i o n Stream i n S r i Lanka, 1981 The D i s t r i b u t i o n of S t a t e Investment i n S r i Lanka Since Independence The L o c a t i o n of the Study Area RNA and R e l a t e d Aspects i n the R u r a l Areas of the Kandy D i s t r i c t The Changes i n the Land-Use i n the Study V i l l a g e The L o c a t i o n of Establishments at the Time of the Survey, 1987 Establishments Before 1965 E s t a b l i s h m e n t s Between 1966-76 Establishments Between 1977-87 The D i s t r i b u t i o n of Work P a r t i c i p a t i o n of Family Members of the Households During One Year P e r i o d  ix  13 ....14 45 45 110 210 233 265 266 272 274 ...278 ...284 284 290 290 3 08  To my f o r t h e i r guidance,  Parents  support and encouragement  i n a l l my endeavours  Acknowledgments I  am  Lanka)  indebted  for  studies  granting  and  providing  to  to  me  me  the  with  the  U n i v e r s i t y of  leave  to  University a  Peradeniya  undertake  of  British  stimulating  my  (Sri  graduate  Columbia  environment  for  during  my  studies. I McGee  am  very  and  other  Professors Morrison  g r a t e f u l t o my members  of  supervisor  my  Professor  dissertation  Nancy Waxier Morrison,  Trevor  Terry  committee  Barnes and  f o r t h e i r encouragement and guidance i n my  -  Barrie  graduate  work. I wish t o thank P r o f e s s o r M o r r i s o n assistance for  i n the  a l l o w i n g me  research.  In  t o use Sri  i n d i v i d u a l s who I am  field  very  survey  and  for his  financial  f o r the Marga  Institute  their village  Lanka,  a s s i s t e d me  I  am  study  thankful  i n the f i e l d  a  t h a n k f u l t o Sandy Lapsky, V i j i t h a  assistance  Special  to  thanks  i n the  to  development  Professors,  of  graduate  support  during  my  stay  at  the  number  my of  Rajendran,  Gunawardene f o r  this  dissertation.  students  members a t the Department of Geography f o r t h e i r and  in  survey.  Saman Fernando, Kandiah Selvaratnam and R.S. their  materials  University  and  staff  assistance of  British  Columbia. Finally, patience  and  I  am  g r a t e f u l to  encouragement  and  undergo i n S r i Lanka d u r i n g my thankful  to  my  family  my  the  wife  Suatha  s u f f e r i n g she  graduate s t u d i e s .  members  for  and  had  I am  friends  her to also  whose  encouragement helped level.  me  t o continue  my  studies  up  to  this  1  CHAPTER  ONE:  INTRODUCTION  The f e a t u r e s of the growth of r u r a l non-farm (hereafter thesis.  RNA)  The  i n S r i Lanka  period  of t h i s  Lanka's independence this  thesis  broadly  study  theme  economic  farm and non-farm  of  this  i s from the date of S r i  (1948) t o the p r e s e n t day  a l l rural  into  form the main  activities  activities  activities.  (1988) . are  The  In  divided  former i s  concerned l a r g e l y w i t h a g r i c u l t u r e but i n c l u d e s f i s h i n g  and  forestry  and  while  the  later  relates  to  industry,  trade  service.(1) 'Rural'  and  'Urban'  are  flexible  terms  of  universal  a p p l i c a t i o n . However, these terms pose c o n s i d e r a b l e problems in  scholarly  analyses  (Moore,  I984b:6). L i p t o n  (1984:155)  says t h a t t h e r u r a l / u r b a n d e f i n i t i o n i s not a c a t e g o r i z a t i o n of space a l o n e . The d i s t i n c t i o n i n v o l v i n g t h e c a t e g o r i z a t i o n of r u r a l / u r b a n areas i s more complex and o v e r l a p p i n g . In S r i Lanka,  'rural'  activities often  refers  t o g e o g r a p h i c a l areas where  a r e predominantly f a r m - r e l a t e d .  economic  R u r a l areas a r e  c h a r a c t e r i z e d by lower p o p u l a t i o n d e n s i t i e s and  dynamic  socio-economic  change  when  compared  with  less urban  areas. The  growth  indication  of  of  RNA  change  i n the  assumed t o be a s s o c i a t e d The  growth  economic  of and  RNA  is  with  i s often  spatial  assumed rural  to  be  economy  increasing accompanied  modifications  an  important  and  is  often  household income. by  other  which  socioindicate  2  agricultural  change  and  increasing  integration  of  rural  areas w i t h the r e s t of the economy. An  important  strategies  in  feature  Less  of  the  Developed  recent  Countries  development  (LDCs)  is  the  emphasis on the development of the non-farm s e c t o r i n r u r a l areas  (ILO,  1983a  s t i m u l a t e RNA agencies  Organization)  rationale the  1987).  Growth-oriented p o l i c i e s  to  were v i g o r o u s l y promoted by i n t e r n a t i o n a l a i d  (e.g.,  governments  and  the  and in  World  Bank,  implemented LDCs  the  by  (Chuta  a  and  International number  of  Liedholm,  Labour  individual 1979).  The  behind the emphasis on the development o f RNA  realization  of the e x i s t e n c e  of the problem  of  is  rural  poverty. Seventy  two  out  developing countries  of  126  Report of 1985.  LDCs  remain  Product  economic  conditions  expectancy, located  poor  in  Asia,  characteristically countries people  such  i n the  areas  and  areas  of  stagnation.  are the  as  The  agrarian  National  are  grouped  as  (or LDCs)(2) by the World Bank's World  Development still  countries  (GNP)  among  Africa  and  differ Taiwan  poorer  other low  nutrition  from and  poorer  The changes  in LDCs  by  a  low  Gross  unsatisfactory  literacy  level,  others). Latin  newly  Korea.  economies  farm-related display  The  America  the  South  developing  engaged  of a number of  characterized  and  (e.g.,  economies  socio-  low LDCs and  live  they  of in  activities.  i n p o p u l a t i o n growth,  are  developing Most  social  life  and  the  rural Rural  economic  agricultural  3  modernization occurred  infrastructural  i n many LDCs have  improvement rural  and  (increasing be one  not g e n e r a l l y  i n the q u a l i t y  population.  The  development  of l i f e  that  l e d t o a marked  f o r the m a j o r i t y  deteriorating  have  employment  unemployment and underemployed)  of t h e  situation  i s considered to  of the most c r u c i a l contemporary problems  f o r those  poor LDCs. The  development  1950s and  policies  1960s were p a r t l y  employment  problems  of  which  were  responsible  the  LDCs.  A  adopted  f o r the  major  in  the  increasing  thrust  of  the  development p o l i c i e s i n the 1950s c e n t r e d on economic growth anticipating  ^trickle  expected b e n e f i c i a l the  effects  of  down'  effects  did  not  impact on the r u r a l poor.  import  substitution  and  have  the  So a l s o  were  industrialization  policies  on which the LDCs p l a c e d t h e i r  stages.  These p o l i c i e s were inadequate t o ease the problems  of growing demand f o r employment.  hopes  i n the  The development  early  policies  i n t h e 1960s focused on improving the use of more advanced technologies  and  intensive  use  of i n p u t s .  These  changes,  g e n e r a l l y d e s c r i b e d as the "Green R e v o l u t i o n " , were a b l e t o i n c r e a s e food p r o d u c t i o n and a g r i c u l t u r a l benefits  were  community. over  Studies  felt  Development  space.  condition  not  While  by  a l l persons  effects  the  incomes but  richer  were  in  the  unevenly  farmers  some  countries  point  to  rural  distributed  benefited,  o f the poorer farmers appears t o have in  their  an  l a n d l e s s n e s s and unemployment as a consequence  the  worsened.  increase  in  (De Koninck,  4  1979 and Byres, 1982). However, i n other r e g i o n s Asia),  rural  income i n c r e a s e d  causing  an  (e.g.,  East  i n c r e a s i n g demand  f o r wage labour(Oshima, 1984). The uneven and  1960s  subseguently l e d p o l i c y  importance as  a  of the development  way  increase areas.  impact of development p o l i c i e s  to  activate  income Ho  and  (1985)  makers t o emphasize  of the r u r a l  "integrated  employment  explains  i n t h e 1950s  rural  non-farm  sector  development"  opportunities  this  the  as f o l l o w s  i n the  and rural  "...Interest i n  r u r a l n o n - a g r i c u l t u r e development has been growing among t h e policy this  makers  and  i s that  economic  urban-centred the  desired  development general  development  and  of  development  capital  impact  on  rural  development  has  been  non-farm  were g e n e r a l l y 1982:  10).  disparities income  flow  increased  By  large-scale,  and  equity.  i s seen  as  as  Thus, a  an  part  be c r e a t e d  the development income  as r u r a l  urban  consumption  through t h e "backward"  a  of t h e  rural  i n r u r a l areas.  More  f o r l a n d l e s s and  encouraging  the  of  alternative  poor  land-poor  (Johnston and  non-farm  areas  could  of the r u r a l l y and  be  produced  "forward" l i n k a g e s  income  The  slowed  who  Clark,  activity,  c o u l d be reduced i n the r u r a l areas. to  the  (1985: 1).  argued t h a t  defined  on  activities,  programme,  non-farm s e c t o r would i n c r e a s e employment c o u l d  based  reason f o r  i n t e n s i v e i n d u s t r i e s has not had  employment  s t r a t e g y f o r development" It  economists. One  rural  down  by  items,  and  between  farm  and non-farm s e c t o r s w i t h i n the r u r a l economy i t s e l f ,  rural  5  development (Sethuraman  can  be  advanced  at  a  much  faster  pace  and Bangasser, 1984; Chuta and Liedholm, 1979;  APO, 1985). In  order  to  test  these  growth-oriented p o l i c i e s  assumptions  i n different  concerning  RNA  LDCs, i t i s important  t o understand t h e f e a t u r e s of t h e r u r a l non-farm s e c t o r and employment  i n LDCs. The e m p i r i c a l  research  i n this  respect  i s i n i t s i n f a n c y i n s e v e r a l LDCs i n c l u d i n g S r i Lanka. study  using  a geographical  research  framework  This  attempts t o  i d e n t i f y t h e growth p a t t e r n s of RNA and examine how f a r they have been s u c c e s s f u l  i n rural  areas over a p e r i o d  of three  decades.  l.l  G e o g r a p h i c a l Approach t o Development  Geographers  have  been  Issues  increasingly  study o f development and underdevelopment  involved  i n the  i n LDCs i n r e c e n t  y e a r s . Geographers suggest t h a t many o f t h e i r  own c o n c e p t s  and t e c h n i q u e s may have c o n s i d e r a b l e r e l e v a n c e t o t h e study of  development.  Porter  (1974)  Forbes and  (1981), McGee  Brookfield  (1974), De Souza and  (1973)  have  documented  i n d i v i d u a l geographers' c o n t r i b u t i o n s t o development Geographers  have  development  through  tried  attempted  t o understand  different  approaches.  t o e x p l a i n development as r e s u l t i n g  d i f f u s i o n o f i n n o v a t i o n s and modernization.  issues.  the process Some  of  o f them  from a p r o c e s s o f Some approaches  6  attempt t o r e l a t e uneven r e g i o n a l development t o v a r i a t i o n s i n t h e d i s t r i b u t i o n o f f a c t o r s of p r o d u c t i o n . Geographers, theories  (e.g.,  using  already  established  modernization,  t h e o r i e s ) have analysed  Marxist  the d i f f e r e n t  development  and  neo-Marxist  i s s u e s o f development  geography. Each o f these t h e o r e t i c a l schemes has c o n t r i b u t e d to  development  fact  theory.  t h a t geographers have continued  empirical  studies.  i s the  t o c a r r y out d e t a i l e d  s t u d i e s o f c o u n t r i e s undergoing development  providing  an  important  body  of  data  based  on  thus  country  Each o f these approaches has i t s m e r i t s and may be  utilized for this Pattison a  But perhaps more important  discipline  study.  (1964: 211) was o f t h e view t h a t geography as had a c q u i r e d  four great  traditions.  The f o u r  g r e a t t r a d i t i o n s a r e t h e s p a t i a l t r a d i t i o n , t h e area s t u d i e s tradition,  t h e man-land  tradition.  Therefore,  tradition  geographical  and  the  earth-science  methods and  techniques  are c e n t r e d around s p a t i a l and r e g i o n a l a n a l y s i s . With r e g a r d t o development geography, t h e g e o g r a p h i c a l approach which emphasizes t h e s p a t i a l v a r i a t i o n s i n economic a c t i v i t i e s can make an important  contribution.  This i s ,  in  p a r t , because many other d i s c i p l i n e s a r e not concerned w i t h t h i s aspect at  o f t h e development process  the non-spatial  which  often  Isard  (1968)  level.  has l i m i t e d  This validity  i n h i s study  presenting  results  arguments  i n generalization  at the r e g i o n a l  of L o c a t i o n  and Space  level. Economy  i n d i c a t e d t h a t t h e a n a l y s i s o f g e o g r a p h i c a l d i s t r i b u t i o n and  7  v a r i a t i o n s o f economic f a c t o r s p r o v i d e a f u l l e r of  spatial  economic  modernization found  that  dependency  the  explaining uneven  and  the  activities.  economic  study t h e  in  LDCs  analyses  helpful  and  in  particularly  (e.g.  De  Souza  and  the geographic p e r s p e c t i v e has been u t i l i z e d  to  labour market and employment-related i s s u e s (see f o r a summary and see  1984a and 1984b),  i t has  t o be used w i t h the major t h e o r e t i c a l  l a b o u r market s t u d i e s  neo-Marxist) The important  is  used  1970; Armstrong and McGee, 1985).  a l s o Freeman and N o r c l i f f e ,  to  their  approach  Van Der Laan and Van Der Meulen, 1987  potential  in  development  development  P o r t e r , 1974; R i d d e l l , Though  of  geographers who  theories  geographical process  The  explanation  (neo-classical,  (Van Der Lann,1987:  study  of s p a t i a l  contributions  great  approaches  p o s t - K e y n e s i a n and  325-338).  mobility  was  one  of the  most  of geographers t o t h e study o f the  labour market s i t u a t i o n i n LDCs. Such e x t e n s i v e s t u d i e s were conducted  i n v a r i o u s p a r t s of LDCs:  Riddell  (1981)  i n West  A f r i c a ; McGee (1982a and 1982b) and Hugo (1982) i n South and Southeast  Asia.  effectively  These  analysed  geographers  and  the labour m o b i l i t y  s i t u a t i o n u s i n g a g e o g r a p h i c a l approach. West  African  weakness  of  migration, the  Riddell  existing  (1981)  approaches  conducted.  Likewise,  McGee  (1984)  indicated  Forbes  that  and the  labour  have  market  emphasized  and  i n which the f u t u r e m i g r a t i o n (1982a  and  others  In t h e a n a l y s i s of  directions  and  also  the  suggested  research  1982b),  could  Hugo  patterns  of  new be  (1982) Asian  8  labour  mobility  of  in fact  'circulatory'  have  similarities  migration  already  to  the  observed  features  in  Africa.  Off-Farm employment i n terms of c i r c u l a t o r y m i g r a t i o n important  phenomenon throughout the T h i r d World.  Geographical  analysis  employment-related First, the  space  geographical  the  research  matching  Secondly,  collection  is  an  for  (distance) p r e s e n t s  effective  labour.  and  researcher  the  approach i n data to  of  the  important  the an  analytical provides  following  important  demand  the  and  framework  reasons.  supply  based  flexibility  causal  i t enables  interpretation  a  data enables  factors associated Finally,  of  labour  In t h i s r e s p e c t ,  market  and  the  labour  market  formation  in  the  employment-  r e l a t e d i s s u e s can be a d i s t i n c t c o n t r i b u t i o n t o the of  on  in  exercise  of  the i d e n t i f i c a t i o n of r e g i o n s of v a r y i n g r a t e s of  labour f o r c e and o c c u p a t i o n a l changes.  study  for  c o n s t r a i n t on  for,  a n a l y s i s . Such an  interpret  tool  w i t h the v a r i a t i o n s i n the labour market behaviour.  spatial  i s an  less  broader  developed  countries.  1.2  The  The  Study of the Growth of RNA  study  of  employment  i n S r i Lanka, 1948-88  change  during  the  post-  independence p e r i o d of S r i Lanka p r o v i d e s an e x c e l l e n t case study of the changes i n RNA.  During t h i s p e r i o d , S r i Lanka,  l i k e s e v e r a l other d e v e l o p i n g c o u n t r i e s , e x p e r i e n c e d employment-related  problems  such  as  serious  increasing  9  unemployment,  decreasing  productivity of labour  stagnation of s p a t i a l and sectoral  and the  labour movements.  The  causes of the employment problems were b a s i c a l l y demographic and  economic.  political  However,  socio-ethnic,  demographic  and  developments during the post-independence period  of S r i Lanka also contributed to the employment change. The  central  aim of t h i s  research  features of the growth of RNA. during  the reference  However,  growth  during  of  significant.  RNA For  slow and proportionately  the regional v a r i a t i o n s i n the the  example,  regions while stagnant  of the  The o v e r a l l growth of RNA  period was  insignificant.  i s a study  same  RNA  period  growth  i n others.  appear  was  rapid  to  be  i n some  The understanding  of the  geographical v a r i a t i o n s of the growth of RNA w i l l lead to a better  explanation  of  the  factors  associated  with  RNA  growth. In order to present the major features c h a r a c t e r i z i n g RNA  growth i n t h i s thesis, i t i s important  major socio-economic, of  to i d e n t i f y the  demographic and p o l i t i c a l developments  post-independence S r i Lanka and also to provide  related  background geographical information about the country.  1.3 Land and P e o p l e ( 3 )  S r i Lanka i s an island of approximately  25,000 square  miles i n area and i s located i n the Indian Ocean (south of the  Indian  Sub-Continent) within 5 and 9 degrees l a t i t u d e  10  north  of  the  equator.  characteristics  arising  However, from  the  true  l o c a t i o n are  overshadowed  the South-Asian monsoonal c l i m a t i c c o n d i t i o n s . distribution (the  c o a s t a l and  than 100 west  varies geographically. hilly  of  the  The  south-west  island  of  the  north  and  region  receives  eastern  by  rainfall  inches of r a i n f a l l per annum mainly from the  monsoon. Most  country  areas)  The  tropical  parts  more south-  of  the  r e c e i v e l e s s than 75 inches of r a i n f a l l per annum.  Geomorphologically, S r i Lanka i s d i v i d e d i n t o two divisions:  c o a s t a l low  elevation  gradually  country.  The  together  determine  Combining  climate,  lands  increases  elevation  and  central h i l l y  towards  the  lands.  interior  ( i n c l u d i n g s o i l types) and  the  nature  geomorphology  of  natural  and  soil,  major The  of  the  rainfall  vegetation. Sri  Lanka  is  d i v i d e d i n t o f o u r major and twenty one minor a g r o - e c o l o g i c a l zones. The low  f o u r major a g r o - e c o l o g i c a l zones are the wet-zone  country,  zone  and  the  the  wet-zone  dry  zone.  hill The  country,  the  geographical  a g r o - e c o l o g i c a l zones i s shown i n Diagram Agro-ecological the  nature  population  of  factors  economic  in  Sri  influence  activities  Lanka.  As  and  intermediate  distribution  of  1.1. land-use  the  Diagram  patterns,  distribution 1.2  shows,  of the  v a r i a t i o n s i n p o p u l a t i o n d i s t r i b u t i o n are c l o s e l y a s s o c i a t e d with is  agro-ecological factors. much  higher  ecological related  The  population  in  the  low-country  factors  are  more  economic  activities.  wet-zone  favourable Rural  concentration  to  population  where  agro-  agriculturedensity  is  11  much h i g h e r decreases  in this  towards  zone. The c o n c e n t r a t i o n of p o p u l a t i o n  the dry-zone  areas  where  densities  are  low. Economic  activity  dominated by r i c e on  the  cultivation.  wet-zone  are  country  Rice c u l t i v a t i o n  is  i s carried  a r e c o n c e n t r a t e d i n the c e n t r a l h i l l y  carried  domestic  out on a l a r g e s c a l e .  agriculture  vegetable  activities  At t h e same  found  l o w - l y i n g areas o f the c e n t r a l h i l l y i n t h e dry-zone  it  difficult  of  t h e low r a i n f a l l  has  to cultivate  developed  (Leach,  over  without  the  rural  ethnic  and  The  1.1b).  Hinduism,  Rice i s the  rainfall  of  makes  Because  irrigation  i n the d r y zone o f S r i Lanka  major  The  and  a t 17 m i l l i o n s i n  population  is  r e l i g i o u s groups  followers  Christianity  of  and  four  religions  Islam)  ( S i n h a l e s e , Tamil  Sinhalese  language  Muslims speak  and t h e i r  and c u l t u r e .  are  and Moor)  identity Hindus  t h e Tamil language,  divided  live into  (see T a b l e 1.1a (Buddhism,  grouped and o t h e r  Veddas and Burghers) e t h n i c groups.  ethnically Sinhala  rice,  valleys  t w o - t h i r d s o f the t o t a l p o p u l a t i o n  areas.  different  (Malays,  the  1980).  Approximately  three  lands.  system  The t o t a l p o p u l a t i o n was estimated 1988.  of  irrigation.  a h i g h l y complex t h e years  time,  in river  but i n s u f f i c i e n t rice  areas and  (the c u l t i v a t i o n  and s p i c e s ) a r e commonly  major crop  in  low  i n s m a l l h o l d i n g s . The p l a n t a t i o n a g r i c u l t u r e crops ( t e a  and rubber)  and  in  into minor  Buddhists are  i s based  are Tamils.  on t h e While  they a r e e t h n i c a l l y of a  T a b l e l . l a : P o p u l a t i o n by R e l i g i o u s Groups, 1981. Religion  Population  Buddhists  10,288,325  69.3  Hindus  2,297,806  15.5  Muslims  1,121,717  7.5  Roman C a t h o l i c s  1,023,713  6.9  Other C h r i s t i a n s  106,855  0.7  8,334  0.1  14,846,750  100.0  Other A l l Religions  %  T a b l e 1.1b: R e l i g i o u s Composition o f E t h n i c Groups, 1981. Religion  E t h n i c Group Sinhalese  Buddhists  Sri Indian S r i Lanka Tamil Lanka Tamil Moors  Burge rs  Malay Others  93.3  1.8  1.8  0.2  2.9  2.1  7.5  Hindus  0.1  80.7  90.0  6.7  0.4  3.4  15.3  Muslims  0.1  0.7  0.5  92.6  1.6  89.2  48.7  Roman Catholics  6.0  14.3  6.2  0.3  79.5  2.2  11.6  Other Christians  0.4  2.4  1.4  0.1  15.1  0.6  12 .1  Other  0.1  0.1  0.1  0.1  0.5  2.5  4.8  Total  100.0  100.0  100.0  100.0  100.0  100.0  100.0  Source: Department o f Census and S t a t i s t i c s ,  1986c.  13 Diagram 1.1: A g r o - E c o l o g i c a l Regions of S r i Lanka  Source: Based on the Map S r i Lanka.  of A g r o - E c o l o g i c a l  Zones of  Diagram 1.2: P o p u l a t i o n D i s t r i b u t i o n by D i s t r i c t , 1981  }  • 5,000 Persons • 20,000 Persons O 100,000 Persons  DISTRICTS A - Colombo B - Gampaha C - Kalutara 0 - Kandy E - Matale F - Nuwara Eliya G - Galle H - Marara 1 - Hambantota J - Jaffna K- Mannar L - Vavuniya M-Mullairivu N- Barticaloa 0 - Ampara P - Trineomalee Q- Kurunegala R- Puffalam S - Anuradhapura T - Polonnaruwa U-Badulla V - Moneragala W- Rafnapura X- Kegalla  MILES SCALE:-  Source: Based on 1981 P o p u l a t i o n Census, S r i Lanka. Department o f Census and S t a t i s t i c s , V a r i o u s Years.  15  different speaking  Buddhist  total  Sinhalese  both  Sinhalese  c o n s t i t u t e about  i n t o two  country.  groups: the c o a s t a l and  Tamils  Tamils  (about  Indian  Tamils  and  and  i n most  Tamils  of  groups  the  S i n h a l e s e a r e subthe Kandyan. p a r t of  groups: Indian  Sri  origin  The this  Lankan (5.5%).  were brought from I n d i a d u r i n g t h e  early  The  twentieth  concentrated  Muslims  centuries.  The  i n the Northern  (7.5%)  live  mainly  late  S r i Lankan and  in  suburban areas and are e q u a l l y d i s t r i b u t e d i n both and Tamil  of  of  are descendants of p l a n t a t i o n e s t a t e workers  are mostly  The  Tamil  two-thirds  i n the h i l l y  c o n s t i t u t e two  13%)  and  Provinces.  concentrated  too  (tea and rubber) who nineteenth  predominant  i n the n o r t h and e a s t . The  Kandyans are mainly  Tamils  are  p o p u l a t i o n . They are  country except divided  There  Christians.  The the  stock.  Eastern  urban  and  Sinhalese  areas. geographical  distribution  ( S i n h a l e s e i n the south and  of the  two  c e n t r e and  major  ethnic  the T a m i l s  in  North and East) strengthen t h e i r e t h n i c i d e n t i t y and h e l p t o perpetuate is  the  substantiated  1968)  when  ethnic  they  groups  p r e s e r v e and has this  divisions  played  by  others  argue is  between the two  that  an  (Pounds, the  important  1972  country.  in later  and  view  Freeberne,  regional concentration factor  maintain ethnic i d e n t i t i e s . a major r o l e  groups. T h i s  which The  political  helps  of to  ethnic factor development  in  16  There (Farmer,  have  1966).  thrived  and  the  The  island.  and  population  kings  recurrent  move  the  S r i Lankan  Buddhist  north  central  South-Indian  towards  part  the  where  of  this  Sinhalese the  present  S i n h a l e s e p o p u l a t i o n i s concentrated. As a r e s u l t , tanks other  irrigation  abandoned and  schemes  in  after  1505,  the i s l a n d was  colonizers.  However, u n t i l  independent.  The  colonizers ruled followed  The  British  years  (1795 During  transformed and  rubber  the B r i t i s h plantation colonial  north-central  part  and were  l e f t i n r u i n s a f t e r the t e n t h c e n t u r y .  Secondly,  who  of  well-developed  invasions  south  This  i n t h i s area. I t  forced  the  civilization  century.  provided  malaria  history  tenth  for rice cultivation  widespread to  the  around  Sinhalese  facilities  of  Sinhalese  before  centred  believed that  island  phases  a  flourished was  irrigation  three  First,  civilization  is  been  1815  Portuguese  r u l e d by  European  the Kandyan area  remained  were  the  S r i Lanka between 1505  and  the  Portuguese  ruled  the  who  remained  country  for  first  European The  Dutch  i n power u n t i l  1795.  one  1658.  hundred  and  fifty  - 1948). the B r i t i s h p e r i o d  (1795-1948), the economy  i n t o a p l a n t a t i o n e x p o r t - o r i e n t e d economy. c u l t i v a t i o n was  carried  i n v e s t o r s i n the h i l l y exports  rulers.  provided The  a  on,  on  Tea  a l a r g e s c a l e by  p a r t of the c o u n t r y .  significant  was  income  for  The the  development of the p l a n t a t i o n s e c t o r  led t o a well-developed  t r a n s p o r t network between p l a n t a t i o n  areas  Colombo.  and  the  port  of  Cheap  labour  was  brought  17  from South I n d i a t o work on t e a and the e s t a b l i s h m e n t  rubber  estates.  Since  of the p l a n t a t i o n s e c t o r , the c o u n t r y  has  j  become  a  major  exporter  of  tea  and  rubber  to  the  world  economy  on  the  local  market. The  impact  of  the  (Kandyan) people  was  great.  the  British  capitalist  agriculture of the  limited  As Bandarage  expansion  the  traditional  plantation  i n the  (1983)  form of p l a n t a t i o n  economic development  Kandyan v i l l a g e s . At  indicates,  the  and  expansion  same time,  immigrant Indian e s t a t e workers were c o n f i n e d t o the areas  which  as  Moore  (rural  and  estate)  mutual  antagonism  (1983)  i n the  indicates created  Kandyan  between these  areas  two  and  a  the  estate  dichotomy  also  communities  led  to  (Robinson,  1975). Sri British in  Lanka was Empire  The  political 1931),  (e.g.,  administration introduction  (e.g.,  c o l o n i z a t i o n schemes) and urban  rich)  a model c o l o n y  reforms  in  unlike i n introduced  of  universal  b u i l d i n g of social the  the  railways,  neighbouring a  number  of  suffrage  in  agriculture  (English education  early  of  B r i t i s h administration  almost u n d i s t u r b e d  British  economic  t o be  (Namasivayam, 1948).  S r i Lanka was  India.  considered  twentieth  f o r the  century.  The  e d u c a t i o n a l and  employment p o l i c i e s of the B r i t i s h  colonial  r u l e r s have had  a significant  Regional  impact on  society.  d i s t r i b u t i o n of e d u c a t i o n a l f a c i l i t i e s was  uneven w i t h  regions,  Golle  districts,  especially  the  Colombo,  Jaffna,  and  r e c e i v i n g g r e a t e r b e n e f i t s (Tambiah, 1955) .  some Kandy The  18  unequal social  educational and  o p p o r t u n i t i e s were  political  to  r e p e r c u s s i o n s i n the  have  economic,  post-independence  period.  1.4  Changes s i n c e Independence  At the  time  well-developed parliamentary economic and of  independence, t h i s  agriculture-based political  political  system  concept. vote  parliamentary The  divided  export  inherited  economy  with  into  several  the  a  result  rule.  system was  of  a  socio-  l e g a c i e s which have been the  a l l persons  c i t i z e n s (5)  and  other  based  on  the m u l t i - p a r t y  members of parliament were e l e c t e d  e x e r c i s e d by were  country  along  f o u r hundred years of c o l o n i a l The  who  of  over  21  years (4)  country.  electorates.  by  The  The  of  popular age  and  country  was  electorates  were  demarcated on the b a s i s of area as w e l l as the s i z e of  the  population.  the  The  densely  p o p u l a t i o n belonged represented majority  populated  t o the  i n Parliament.  wet-zone area where  S i n h a l e s e e t h n i c group was The  political  h i s c a b i n e t . ( 6 ) Each government, once e l e c t e d ,  c o u l d c o n t i n u e up t o a p e r i o d of f i v e  two  the  i n p a r l i a m e n t formed the government l e d by a Prime  M i n i s t e r and  The  party having  well  post-independence  major p o l i t i c a l  parties  years.(7)  governments  were  formed  by  the  (the U n i t e d N a t i o n a l P a r t y  and  S r i Lanka Freedom Party) which were overwhelmingly  dominated  by the S i n h a l e s e community and had s m a l l number r e p r e s e n t i n g  19  other  ethnic  (Tamils) as  The  largest  minority  ethnic  came t o be r e p r e s e n t e d by Tamil p o l i t i c a l  well.  had  groups.  The e t h n i c - o r i e n t e d  great  impact  political  on the employment  group parties  developments  changes  have  i n the post-  independence e r a . Since process  the ultimate  (i.e.,  achieving  left  t o t h e people  were  directly  decision  making  i n the  p o l i t i c a l c o n t r o l o f one p a r t y ) was  o f t h i s country,  responsible  the p o l i t i c a l  to the e l e c t o r a t e .  and e l e c t o r a l p o l i t i c s  issues  such as s o c i a l w e l f a r e . These i s s u e s were by  independence development  a l l the major governments  o f domestic  were  centred  political  focused agriculture  around  parties.  in  parties  The  agenda  exploited  political  party  popular  vigorously The  particular  post-  on  the  and the promotion o f  s o c i a l s e r v i c e s f o r the people. The  problems o f t h e s m a l l h o l d e r i n t h e wet zone  landlessness received  and  greater  agricultural schemes  under-employment attention  development  i n which  new  in  were the  programmes.  becoming  worse  post-independence Village  a g r i c u l t u r a l lands  where  were  expansion  open  up and  a l i e n a t e d t o l a n d l e s s people were implemented i n many a r e a s . Another  policy  was t o develop  underpopulated dry-zone areas. irrigation  projects  were  new a g r i c u l t u r e  M u l t i - m i l l i o n rupee massive  undertaken  schemes t o improve t h e c o n d i t i o n  lands i n  i n the  colonization  of the farmers.  Landless  persons from t h e wet zone were s e t t l e d i n these c o l o n i z a t i o n schemes.  The i d e a of opening up the d r y zone which had once  20  been the c e n t r e of S i n h a l a c i v i l i z a t i o n was  an encouragement  in  re-settling  p u r s u i n g these c o l o n i z a t i o n schemes and  region.  The  domestic  zone encouraged  agricultural  the  dry  labour movements from d e n s e l y p o p u l a t e d  wet  zone t o the dry zone where about  development  100,000 wet  zone  families  and  homes i n  1985) .  The  dry  greatly  to  (mostly S i n h a l e s e ) were g i v e n c u l t i v a b l e the  dry  zone  areas  agricultural  (Wickramasekara,  development  contributed  in  that  land  zone  increased  r i c e p r o d u c t i o n i n the country. The  social  developments,  on  the  other  hand,  were  concerned w i t h the up-grading of the h e a l t h and e d u c a t i o n of the  people.  university,  In free  this  respect,  medical  facilities  were p r o v i d e d f o r the people. proportion  of  free  i t s income,  around  ten per  the post-independence  period,  either  as  as  1988: and  Table  92).  social  earnings  grants The  capital  investment  of  or  had  plantation  even  free  up  to  food(8)  The s t a t e spent a s i g n i f i c a n t  during  direct  and  education  on  been  agricultural  the  (Bhalla,  agriculture  e x t r a c t e d from exports  GNP  programmes  benefits  f o r both  mainly  of  welfare  indirect needed  cent  the  and  foreign  of  physical  have  produced  donors. The and  social  significant  state  investments  qualities  of  changes w i t h i n  aggregated  statistics  indicators  (e.g.,  improved  life  and of  the  people  a short period  indicate  infant  the promotion  of time.  (Table  mortality,  life  1.2),  As  the  health  expectancy)  remarkably. M o r r i s (1979), u s i n g a p h y s i c a l  quality  21 T a b l e 1.2: The Changes i n S o c i a l I n d i c a t o r s During t h e Post Independence P e r i o d i n S r i Lanka.  Year  Literacy Rate (%)  Infant Mortality Rate (per 1000s)  Life Expecttancy (Years)  Per C a p i t a Availability of Crop Land (Acre)  Total Open Unemployment (No.)  1940  39.9  149  31.7  1950  69.0  82  56.5  1.0  1960  77.0  57  62.0  0.4  526000  1970  78.5  48  64.0  0.4  839264  1982  87.2  32  69.0  0.2  897249  '-' I n f o r m a t i o n not a v a i l a b l e  Source: Column 1,2 and 3 are from B h a l l a and Glewwe, 1986; f o r column 4, f i g u r e s f o r 1950 and 1970 are from Department of Census and S t a t i s t i c s , 1983a and f o r 1960 and 1982 a r e from A s i a n Development Bank, 1986; f o r column 5 i s ( f o r 1971 and 1981) from Department of Census and S t a t i s t i c s , 1986c and ( f o r 1963) ESCAP, 1976.  22  of  life  index, ranked S r i Lanka as f i r s t  f o r t y - t w o low income c o u n t r i e s of under $300 US).  among t h e world's  (those d i s t i n g u i s h e d by a  The s o c i a l  i n d i c a t o r s such as e d u c a t i o n  level,  l i t e r a c y r a t e s a l s o showed an improvement d u r i n g  period  (Table  this  1.2).  However, the above led  GNP  mentioned development  t o some u n d e s i r a b l e  consequences.  The  efforts  also  improvements  in  the p h y s i c a l q u a l i t y of l i f e of the people, p a r t i c u l a r l y t h e sudden  decline  corresponding population  i n mortality decline  growth.  in  The  rates the  total  in  birth  the  absence  rates  population  of  of  accelerated this  country  almost doubled w i t h i n 25 years of independence (between and 1971). in  Such a p o p u l a t i o n  a rapid  matured, result, about  increase  the the  20  economy  also  Secondly,  the  agricultural established tensions  f o r employment  incidence cent  resulted  of  of  open  the  suffered creation  of  development  labour  Sinhala  projects,  colonies  to  rural  some  of  under which  i n the predominantly Tamil areas, c r e a t e d  the were  ethnic  (Kearney, 1988 and Ponnambalam, 1983).  performance  performance  during  weakened.  t h i s period  was  The due  an unchanged  economic  structure  the o v e r a l l  poor  economic  to several  i n c l u d i n g worsening world market c o n d i t i o n s exports,  The  a  under-employment.  While employment problems were i n c r e a s i n g , economic  As  increased  force.  increasing  as they  steadily.  unemployment  total  from  rose  1948  initially  i n the number of c h i l d r e n and  demand  per  "explosion"  a  factors  for agricultural where  agriculture  23  remained  the major  growth.  These  productive  the slow  been  Isenman, 1980; Gunasinghe,  1984  and o t h e r s . F u r t h e r , i t has  been i n d i c a t e d t h a t  economic p o l i c i e s and  this  weak  already  worsening  studied  in  economic  have  aggravated  problems  s e c t o r and  situation  depth  by  management  (Samarasinghe,  1980). With r e g a r d t o the employment problems, the economy not  able  to  change  structurally  from  low  value  was  primary  p r o d u c t i o n t o secondary and t e r t i a r y s e c t o r i n d u s t r i e s which could  provide  unemployment  additional  became  situation"  i n 1971  uprising.  Immediately  employment.  the  catalyst  increasing  an  "explosive  for  i n the form of the S i n h a l e s e r u r a l after  i n t r o d u c e d some economic  this  uprising,  Law  youth  t h e government  reforms i n c l u d i n g the  and implementation of the Land Reform agricultural  Thus  1972  introduction i n which t h e  lands a c q u i r e d under the land r e f o r m programme  were d i s t r i b u t e d among the unemployed S i n h a l e s e youth.  This  and o t h e r reforms i n c r e a s e d the s t a t e ' s r o l e i n t h e d a y - t o day economic  a c t i v i t i e s of S r i Lanka but d i d not p r o v i d e an  e f f e c t i v e s o l u t i o n t o employment problems. The l a c k of adequate p o l i t i c a l r e p r e s e n t a t i o n o f T a m i l s i n t h e c e n t r a l government r e s u l t e d interests  i n the  indicates, service, policies Tamil  the  national  were  society  agenda.  post-independence  education, against from  electoral the  the  i n the n e g l e c t As state's  and  Appathurai language,  resource  Tamils' i n t e r e s t s  mainstream  of  of Tamil  and  S r i Lankan  (1983) civil  allocation alienated society.  24  Radical  elements grew among the  limited  higher  educational  unemployment. In further war  1977  aggravated  situation'  Tamils,  their  and  a  ethnic  problems  from  perspectives  the  for  of  aspects  and  economic,  the  ethnic  present  ethnic  conflict  De  Tamils  a  x  civil  homeland  been  and  1988;  The of  led to  have  of  increasing  against  separate  ethnic  adequately s t u d i e d . As i s e v i d e n t the  a  This  a result  and  riots  S r i Lanka  Kearney, 1985  1979) .  geographic  ethnic  political,  (e.g.,  Arasaratnam,  1983  demand  Eelam.  youth as  opportunities  frustration.  the Tamil  The mainly  and  Tamil  for  analysed  historical Silva,  1982;  demographic  problems  and  were  not  i n t h i s study the r o o t s of to  the  changes i n the economic and demographic s i t u a t i o n d u r i n g  the  post-independence p e r i o d . the  two  state  major too  appears  aggravating this  and  term  The  to  were not  is crucial.  have  been  competition opportunities inter-ethnic  said  for has  been the  group c o n f l i c t s  role  of  of  the  significant  in  and  short-term  the p o l i t i c a l  ethnic  enmities. conflict,  the  an  decades,  and  cause  i n the  worsening  i n the e t h n i c  resources major  often  s o l u t i o n t o the  "...over  political  In such a c o m p e t i t i o n ,  were  unemployment  that  distribution The  very  policies  t o the r o l e of p o l i t i c s  (1979)  traced  employment s i t u a t i o n d u r i n g  h e l p f u l on  of  be  geographical  groups  state  problems  With r e g a r d Phadnis  The  probably  the s o c i o - e t h n i c and  period.  targeted long  ethnic  can  of  scarce  acute  economic  exacerbation  politics  of  of  S r i Lanka.  l e a d e r s h i p of both  the  25  Sinhalese  and the Ceylon Tamils manipulated  t o u n d e r l i n e the p o l i t i c a l  post-independence  gradually  strengthened  accumulating  lands  nationalization owned). As Lanka d u r i n g regulated even  state's land  (1984)  the p e r i o d  to  in  reform  Sri  Lanka  power  laws  and  ( f o r e i g n and  suggests,  1956 t o 1977 may  by the  local  the economy  of S r i  be c a l l e d  a state  T h i s s t a t e domination c o n t i n u e d  though the new encourage  (1979: 205) .  economic  of p r i v a t e c o r p o r a t i o n s  1977  attempted  governments  the  economic system.  after  consciousness"  through  Gunasinghe  symbols  i d e n t i t y of the r e s p e c t i v e groups  and thereby m o b i l i z e community The  ethnic  government  the  private  elected sector  in and  1977 its  investments.  The s t a t e was the major employer and t h e r a t e  of  sector  private  According  employment  t o the 1981  population  of t h e t o t a l employed p o p u l a t i o n i n the s t a t e sector. employees  were  mainly i n t h e r e c e n t decades.  during  absorbing increase  expansion This  of  continuously,  introduced  by  post-1977  is  25  percent  i n S r i Lanka were employed  service  and  were  recruited  This points to the i n c r e a s i n g  the the  government open  with  has  market  government  concerned  i m p l i c a t i o n s f o r the  However, w h i l e t h e employment  of employment c a p a c i t y  study  census r e p o r t ,  has important  i n r u r a l areas.  capacity  significant.  c a p a c i t y of the S r i Lankan s t a t e s e c t o r  t h e study p e r i o d  growth o f RNA  less  More than 90 per cent of t h e t o t a l o f  i n government  employment absorbing  was  economy  has  outside the  continued which  to was  contributed  t o the  the s t a t e  sector.  growth  aspects  of  26  employment sector  (RNA)  resulting  from  both  state  and  private  of RNA  growth  activities.  1.5 The O r g a n i z a t i o n o f the T h e s i s  Chapter Two which  is  p r e s e n t s a conceptual model  based  on  the  empirical  evidence  of  LDCs  p a r t i c u l a r l y from the A s i a n c o u n t r i e s . The  features  described to  of RNA  RNA  growth  i n Asian  countries  i n Chapter Three. The purpose of t h a t  identify  identify  of  the  spatial  t h e major  variations  factors  of  associated  RNA  are  chapter i s  growth  and  with d i f f e r e n t  to  types  growth i n A s i a .  Chapter population  Four and  considers  economy  of  the  major  changes  post-independence  in  Sri  Lanka.  While i d e n t i f y i n g the major socio-economic, demographic employment changes d u r i n g the study p e r i o d ,  the  and  the r o l e o f t h e  s t a t e and i t s economic and employment p o l i c i e s a r e examined. Chapter and  1981  overall  Five  using  analyses  macro-level  historical  the growth  of RNA  statistics.  patterns  of  RNA  between  It identifies growth  during  1948 the that  period. Chapter growth  S i x looks  a t the s p a t i a l  i n S r i Lanka. The d i s t r i c t  information  i s used t o analyse  level  district  variations (meso)  of  RNA  statistical  variations  growth and i d e n t i f i e s the r e g i o n a l p a t t e r n s o f RNA  of  RNA  growth.  27  Chapter Seven p r e s e n t s a v i l l a g e case study t o show how the study o f employment f e a t u r e s enable  more  informed  of RNA a t t h e micro  interpretation  of  level  macro-and  meso-  statistics. Finally,  Chapter  Eight  concludes  the a n a l y s i s  o f RNA  growth i n S r i Lanka w h i l e summarizing the major f i n d i n g s o f t h i s study i n t h e i r t h e o r e t i c a l and e m p i r i c a l c o n t e x t s .  28  Notes 1 The terms 'farm' and 'non-farm' are d e f i n e d and e x p l a i n e d i n Chapter Two S e c t i o n 2.4. 2 The term Less Developed C o u n t r i e s (LDCs) r e f e r s t o countries other than 'developed market economy' and ' c e n t r a l l y planned developed economy' c o u n t r i e s . I t i s used interchangeably with "Third World" and "Developing Countries". LDCs have a low per c a p i t a GNP a c c o r d i n g t o t h e World Bank c a t e g o r i z a t i o n of c o u n t r i e s . 3 For a more d e t a i l e d account of the a s p e c t s o f geography o f the S r i Lanka see Farmer (1957), P e i r i s (1977). 4 The minimum age o f e l i g i b i l i t y y e a r s t o 18 y e a r s i n 1957.  t o vote was changed from 21  5 The Ceylon C i t i z e n s h i p A c t of 1948, t h e I n d i a n and Pakistani Residents A c t of 1949 and t h e P a r l i a m e n t a r y E l e c t i o n (amendment) A c t o f 1948 removed t h e v a s t m a j o r i t y of I n d i a n Tamils from the e l e c t o r a l r e g i s t e r (De S i l v a , 1982: 161). 6 The c o n s t i t u t i o n o f S r i Lanka was amended p r o v i d i n g f o r an e l e c t e d e x e c u t i v e p r e s i d e n t .  in  1977  7 S i n c e 1977, t h e p e r i o d of p a r l i a m e n t has been s i x y e a r s . 8 F o r many years i n S r i Lanka, a f t e r World War 11, a s p e c i f i e d q u a n t i t y of r i c e was s u p p l i e d f r e e t o a l l poor f a m i l i e s i n S r i Lanka. The q u a n t i t y and t h e method o f d i s t r i b u t i o n v a r i e d over the y e a r s .  29  CHAPTER  TWO: T H E CONCEPTUAL THE  This  STUDY  thesis  Lanka. L i k e  OF RURAL  studies  several  AND METHODOLOGICAL NON-FARM  t h e RNA  other  less  ISSUES  IN  EMPLOYMENT  growth mechanisms  developed c o u n t r i e s  in  Sri  (LDCs),  S r i Lanka has f a c e d a number o f employment-related problems particularly employment  during  the l a s t  i n LDCs  have  forty  been  years.  closely  The changes i n  connected w i t h t h e  changes i n t h e p o p u l a t i o n and t h e economy. F o r example, t h e rate  of population  result,  growth  rose  significantly  t h e labour f o r c e p o p u l a t i o n i n c r e a s e d r a p i d l y .  i n c r e a s e d supply of labour r e s u l t e d and  and, as a  under-employment  i n many  The  i n growing unemployment  developing  countries  where  economic growth performance was poor. S r i Lanka's e x p e r i e n c e of  population  growth,  economic  performance and employment  c r e a t i o n were c h a r a c t e r i z e d by many o f these f e a t u r e s . This thesis of  the labour  i n v e s t i g a t e s t h e changing s p a t i a l  market,  which c o n t r i b u t e d study  t h e growth  o f RNA,  t o t h e growth o f RNA  period  under  i s between  sense,  the s t r u c t u r a l  and t h e f a c t o r s  i n S r i Lanka.  1948 and 1988.  changes  features  i n population  The  I n a broad and  economy  determine t h e f o r m a t i o n of the labour market. However, t h e employment order  changes a r e complex  to identify  changes  i n RNA  the h i s t o r i c a l  growth,  scheme which w i l l  and vary g e o g r a p h i c a l l y . I n  this  as w e l l  thesis  as g e o g r a p h i c a l  proposes a  conceptual  guide t h e a n a l y s i s o f t h e p r o c e s s o f RNA  30  change  i n S r i Lanka.  scheme of RNA  2.1  This  chapter  presents  the  conceptual  growth.  Issues on the Growth of P o p u l a t i o n , Economy  and  Employment i n LDCs  Population, interrelated  economy  in  relationships  their  argued t h a t the complex  features  the  other  developed  employment nature  activities  members  nature too  particularly age  or  complexity p a r t l y due  due  economy.  closely  other.  Such  Dixon, 1982a) have  of  countries.  not  cover  often  do  not  in  these  countries.  by  depend s o l e l y  salient  family  on  and  individual  360-62).  the  rural  by  complexity  to  the  participation  to h i s t o r i c a l factors  individual of  LDCs. Family  contribute work  Conventional  a l l the  influenced  of work p a r t i c i p a t i o n  i n the  of an i n d i v i d u a l partly  each  employment  are  illustrates  sex,  do  of  ( C a l d w e l l 1982:  The  of  in  s o c i a l groups and  choice  on  (e.g., Gregory, 1979;  than  of  Employment  impact  are  i s s u e s r e l a t i n g t o "employment" i n LDCs a r e  definitions of  employment  have been examined f o r LDCs i n r e c e n t decades.  Several researchers  more  and  work  members,  household in  rural  family  behaviour regardless  income.  The  societies  is  such as the r o l e and  status  i n the f a m i l y as w e l l as i n the s o c i e t y and  to  the  recent  In  fact,  the  i n d i v i d u a l workers i s not  changes  in  actual  work  population  and  participation  well represented  in  the by  statistical  31  information  such  as  include  such  areas.  For instance,  the  detailed  women i n r u r a l  work  censuses  information Dixon  is  collection  of  situations  p r e v a i l regarding  of  female  "distorted type".(l) that  resulting  in a Similar  work p a r t i c i p a t i o n  o f t h e LDCs'  with  non-wage  agriculture  and  unemployment  i n the r u r a l  (e.g.,  and Sabot,  open  markets o f LDCs a r e o f  T h i s idea has been supported by t h e  associated  description  i n the  labour u t i l i z a t i o n i n LDCs have l e d  the function  Berry  that  workers" whose  labour.  children's  t o t h e common b e l i e f t h a t t h e labour  fact  i n rural  excluded  labour  to  1978).  These f e a t u r e s o f  a  inputs  (1982a and 1982b) suggest  rural  underestimation  et a l . ,  of work  systematically  consistent  (Nag,  are too general  s o c i e t i e s are " i n v i s i b l e  participation  statistical  which  employment  urban  However,  1978; Gregory, market  market  particularly  unemployment  areas.  o f LDCs labour  labour  and  is in  disguised  recent  studies  1979) show t h a t t h e  as being  ^distorted' i s  not c o r r e c t . F o r example, Berry and Sabot (1978) say t h a t ". a  closer  unemployment  and  malfunctioning  other  suggests  misallocations misallocations functioning"  look  at  open  possible that  unemployment, types  they  of  may  than they appear, and o n l y be  (1978:  attributed 1199).  to  poor  In f a c t ,  be  disguised  labour  market  less  serious  i n part  can such  labour  i t may w e l l  market be t h e  case t h a t i n t h e LDCs, though t h e labour market mechanism i s  32  l o o s e l y organized,  i t i s neverthelesless functioning rather  well. Population employment complex  growth  is  activities.  set  of  the  But  variables  major  this  supply  term  relating  masks to  source  for  much  more  a  declining  infant  m o r t a l i t y and i n c r e a s i n g b i r t h r a t e which have a pronounced effect  on the numbers of people  and remaining in  the  e n t e r i n g the l a b o u r  w i t h i n the labour market.  population  structure  Therefore,  directly  and  force  changes  indirectly  i n f l u e n c e the employment s t r u c t u r e and i t s c h a r a c t e r i s t i c s . Rapid the  p o p u l a t i o n growth has been common i n many LDCs d u r i n g last  growth  three  i n most  annum d u r i n g which was  to  four  LDCs was  the l a s t  enough  decades. about two  The  rate  of  and a h a l f  f o u r decades  population  per cent  (United N a t i o n s ,  t o double the t o t a l  population  per 1986)  within  28  y e a r s . The t o t a l p o p u l a t i o n i n c r e a s e i n LDCs had much impact on  the  rapid  employment  population  situation.  growth  In the e a r l y  stage  (1960s),  r e s u l t e d i n the r a p i d i n c r e a s e i n  the dependent p o p u l a t i o n which was an economic burden on t h e working p o p u l a t i o n .  In the middle and l a t e r  demographic t r a n s i t i o n , increasing  the labour  numbers of people  of the  f o r c e growth r e s u l t e d i n  e n t e r i n g the l a b o u r  l e d t o growing unemployment, under-employment many low income  stages  f o r c e and  and p o v e r t y i n  c o u n t r i e s i n LDCs (Coale, 1983:  828-832) .  Economic growth i s the major f a c t o r c r e a t i n g t h e demand for  labour.  The  performance of  l e v e l and t h e nature  the  economy  of employment a b s o r p t i o n .  affects The  the  overall  33  economic  g r o w t h h a s b e e n s l o w i n many l o w i n c o m e L D C s .  the  W o r l d Bank R e p o r t s ( W o r l d Bank, 1971  the  growth  the  p r i m a r y s e c t o r c o n t i n u e d t o be t h e m a j o r c o n t r i b u t o r  the  GNP.  of  i n GNP  Both  i n LDCs r e m a i n e d  indicators  t h e s e economies  result, when  the  the  sixties.  and  capacity  supply  of  slow  f o r labour labour  i n income  structural  absorption  rural  rapidly  Finally, economic  and  that  aspects  of  studies  considered here.  introduced  underdevelopment L D C s . The  economic  main  Four  First,  argument by  rural  migration. growth  and The  interrelationships  performance  literature  (see  are  well  Fredericksen,  which synthesize the i n t e r r e l a t i o n s h i p s  numerous.  its  productivity,  1979).  growth,  are  the  interrelated.  the  a  improve  after  population  very closely  i n the development  population  bases  are  negative  and F r e e d m a n , The  LDCs  shown  p o p u l a t i o n g r o w t h and e c o n o m i c  documented 1969  be  performance  positive between  i t must  As  between  and u r b a n a r e a s i n c r e a s e d c a u s i n g r u r a l u r b a n  to  performance  d i d not  a r e a s and  while  change.  in agricultural  within  indicate,  fluctuated  overall  increased  D e s p i t e improvements  disparities  l o w and  show t h e p o o r their  t o 1988)  As  performance major  in  and  the  argument  employment  approaches  are  the d u a l i s t i c s e c t o r a l  mainly  Lewis  and  on  1954  economic to  sectoral of  labour s i t u a t i o n resulting  this  explain  model  which  indicators  employment i s that  in  briefly  model  the  of  was  nature  of  situation  in  the  from p o p u l a t i o n i n c r e a s e  surplus and  34  underdevelopment of the o v e r a l l sector  keeps wage r a t e s  below  economy the r e a l  i n the  traditional  wage.  Such  a  low  wage s i t u a t i o n f a c i l i t a t e s the i n c r e a s e of i n v e s t o r s ' p r o f i t and  i s c a l l e d " c a p i t a l i s t surplus". This c a p i t a l i s t  according  to  Lewis'  model,  modern s e c t o r of p r o d u c t i o n  be  re-invested  i n the  and would u l t i m a t e l y absorb the  surplus  labour  from  (Lesson,  1979).  T h i s assumes t h a t s u r p l u s labour c o u l d  a  in a  place  growing  correspondingly existent.  the t r a d i t i o n a l  (1963) absence  modern  sector  modern  labour  within  sector  i s therefore  a  number  of  the p o p u l a t i o n  o f employment  "Agricultural  other growth  change.  is  LDC  find  but  often  a  non-  not removed  factor  from  poverty.  Geertz's  I n v o l u t i o n " t h e s i s argues t h a t  Contrary  and  to this,  have  as t h e major  respect,  of economic development, p o p u l a t i o n  shared  a  sector  researchers  In t h i s  i n shared work ( d i s g u i s e d unemployment and  subsistence  sector.  Secondly,  mechanism  traditional  increasing Surplus  conceptualized  the  would  surplus,  growth  i n the results  under-employment)  Boserup  (1965)  and  o t h e r s argue t h a t p o p u l a t i o n growth s t i m u l a t e s t e c h n o l o g i c a l progress  and  employment  type of argument, ".  .  Bloom  . population  capacity.  Synthesizing  and Freedman  growth may  (1986)  enhance  this  latter  indicated  the a b i l i t y  that  of  an  economy t o s h i f t workers among s e c t o r s " (1986: 398) . Thirdly,  employment  changes are a l s o a n a l y s e d  o c c u p a t i o n a l m u l t i p l i c i t y p o i n t of view.  from t h e  The main argument  35  of  this  LDCs  approach  has  large  the  significantly  participation T h i s has  i s that  outside  r a p i d labour  increased the  formal  l e d to the s i g n i f i c a n t  variety  research  on  occupational  of  activities.  rural  Java  as  (different  household members. He  labour  sector  force  of  the  For  example,  well  age  as  and  (1976) says  the  economy.  White's  (1976)  significant  sex  groups)  "Each household  division  (1976:280). i n d i c a t e s the  of  the  labour  Likewise,  Hart's  among  multiplicity.  town may  income o p p o r t u n i t i e s  be  informal  He  survives highly  members"  s e c t o r as  (1973) says  derived  rather  household  rural  (1973) r e s e a r c h i n urban A c c r a  emergence of the  of o c c u p a t i o n a l force  of  in work  of  on a b a s i s of extreme ' o c c u p a t i o n a l m u l t i p l i c i t y ' and flexible  in a  multiplicity  the  in  work  i n c r e a s e of occupations  illustrates  activities  participation  the  f o r c e growth  than  from the merely  the  "The  form  magnetic  multiplicity  from  wage  of  levels"  (1973:88). Finally, changes  the  has  geographers'  focused  mainly  distribution  of  economic and  population  Further,  the  labour  which  approach on  to  spatial  results  mobility  from  the  s t r u c t u r e of a country  geographical  approach  the  unequal  growth.  The  spatial  economic  commonly analysed  geographers was  rural  regions  development aspect  and  changes  in  or a r e g i o n .  integrates  employment approaches i n the s p a t i a l context. labour m o b i l i t y between s e c t o r s and  employment  the  major  I t argues t h a t  i s the r e s u l t and  of  population  of labour m o b i l i t y by  to urban m i g r a t i o n .  McGee (1978b  and  36  1982a),  Forbes  (1984)  analyses  of A s i a n  of  urbanization  slow  and  Hugo  (1982  and  1984)  in  labour m o b i l i t y i n d i c a t e d t h a t t h e  modes of p r o d u c t i o n  and  the  persistence  encouraged the  between urban and r u r a l  of  their nature  traditional  'circulatory'  migration  areas.  The employment changes i n LDCs d u r i n g t h e l a s t t h r e e t o four  decades  then,  have  the  changes  in  economy  population  growth  has  been very and  been  clearly  associated  population.  The  r a p i d which made a  with  pace  of  significant  impact on employment change.  2 . 2 S t u d i e s i n RNA  The  emphasis  development  i n LDCs  on the development  strategies  development p o l i c i e s  in  LDCs  is  of RNA a  as one  recent  of the  one.  i n the 1950s were c e n t r e d on  The  "economic  growth" and " t r i c k l e down" approaches. The implementation those  policies  income  countries.  distribution,  growth  to  solve  Instead,  policies  respect,  and  achieve  t h e development  problems  aggravated  to  eliminate  self-reliance of RNA  was  fact,  unequal  low  income  or " r u r a l l e d "  poverty, in  aimed  i n c r e a s i n g unemployment and under-employment poor by  in  (Seers, 1977: 3 ) . The  l e d t o "bottom-up"  s t r a t e g i e s i n order needs  they  existing  unemployment and poverty  f a i l u r e o f those  basic  failed  of  LDCs.  provide In  this  at curbing  the  among t h e r u r a l  i n c r e a s i n g income o p p o r t u n i t i e s i n r u r a l  areas.  In  the promotion of t h i s development s t r a t e g y i s l a r g e l y  37  external.  Chuta  international  and  donor  agencies  developing  countries  increasing  attention  programmes  Liedholm and  have to  (1979) the  in  various  begun  development  f o r expanding p r o d u c t i v e  opportunities  11  new  research important  the  non-farm  role.  international  For  example,  publications.Development (1978a)  and  (1978c),  Rural  are  a r t i c l e s on RNA Income  for  Enterprise  (ILO)  activities  in  Africa  Asian  Pacific  A  those  number  (New  aid  and  of  covering  a  broad  an  Bank's  The  Employment  International  s e v e r a l books  conference  Non-  Industries  (APDC)  research  reports  and  on  this  Chiang-Mai  Asian P r o d u c t i v i t y Organization were  and  organized  private  spectrum  and  the  recently  work  (e.g.,  and and  (1987). Furthermore, Centre  containing  Delhi))  agencies  Asia  s y n t h e s i z e d the growth of RNA. RNA  play  World  Small-Scale  Development  volumes  (Thailand) Conference, Conference  promoted  I n c l u d i n g R u r a l women Through  Employment  two  has  i n LDCs such as Promotion on Employment  (1983a), R u r a l  subject.  1).  Non-Farm  also published  Farm A c t i v i t i e s  published  and  contributions.  R u r a l Poor  and  earning  a i d agencies the  and  Issues on R u r a l Non-Farm Employment  important  Labour O r g a n i z a t i o n  many  devote  and  emphasis on the development of RNA  i n which  of  .  policies  undertaken i n the d e v e l o p i n g c o u n t r i e s " (1979: The  .  to  employment  rural  .  governments  recently  the  say  (APO)  published  organizations  by  which  A number of r e c e n t s t u d i e s on of  RNA-related  subjects  and  38  g e o g r a p h i c a l areas been important  ( A s i a , A f r i c a ( 2 ) and  L a t i n America) have  contributions i n t h i s respect.  A number of case s t u d i e s a l s o were p u b l i s h e d . work which  sponsored  and  Employment  Promotion  (ARTEP),  important.  Secondly,  affiliated  with  study of RNA.  done by a  Regional  branch  several  a i d agencies  Asian  of  Islam  The However, important. (1980  and  using  a  is  very  individual  researchers the  These works i n c l u d e those of Oshima (1984  and  and  1985)  affiliated  with  ADB,  and  1984)  the  World  and ARTEP r e s p e c t i v e l y .  geographical two  for  have a l s o c o n t r i b u t e d t o  ( 1984  Bank, the ILO,  Team  ILO,  1985a), Anderson and L e i s e r s o n (1980), Chuta (1979 and  Research  notable  First,  approach  to  RNA  contributions  Freeman  (1984a  and  i s not in  widespread.  this  regard  1984b) and  Norcliffe  1984a) have analysed the d i f f e r e n t aspects geographical  approach.  Secondly,  are  of  McGee  (1987)  looked a t the s p a t i a l changes of employment a c t i v i t i e s the  point  affecting areas  of  of  view  of  the  operation  agricultural  and  industrial  A s i a . He  identified  certain  urban c e n t r e s i n which t h e r e has of  employment  often  governments  changes areas  an  be  given  increase  due  to  greater their  rural  close to  major  This  i n household  income  is and  He emphasized t h a t those  a t t e n t i o n by  importance  development of those c o u n t r i e s .  processes  i n the  in non-agricultural a c t i v i t i e s .  associated with  should  economic  from  been a marked a c c e l e r a t i o n  o t h e r f e a t u r e s of economic growth. areas  of  RNA  in  the the  individual economic  39  These of  the  s t u d i e s have  rural  non-farm  areas  sector  and  it and  can  lead  and  also  comprehensive (1978a)  the  of  they  Mukhopadhyay  RNA  of  using  and  significance and  income  to  a  that  these  attempted  assess  the  of RNA.  Oshima  and  of  was  studies  definition  of RNA.  p r o p o r t i o n a l growth of RNA.  a  study  of  also  rural  provided  Finally,  they  s t a t i s t i c a l materials  a r e a . However, absence  of  of  recent  a  major  critical  studies  and  The  the  employment individual  main  purpose  absolute  However, they l a c k a  c o n c e p t u a l and d e f i n i t i o n a l framework f o r any  have  qualitative  s e c t o r s i n the  measure  the  RNA.  Asian countries. to  and  Bank  quantitative  t o other  (1984  World  of the non-farm s e c t o r i n terms of in relation  For  t o d e f i n e non-farm  studies  number  to  The  s t u d i e s i s the  a  (Chuta  provided  i n the study  that  and  (1985)  broader  these  economies of A f r i c a n these  rural  Lim  RNA.  research i n t h i s  i s evident  attempted  have  areas.  assessment of the growth mechanism of It  of  studies indicated  have p r o v i d e d comprehensive secondary  limitation  rural  income i n e q u a l i t i e s  in rural  Thirdly,  comparative  the  process  (1983a) study attempted  m e t h o d o l o g i c a l guidance  for  of  framework f o r the study  definition  analysed  areas.(3)  in  Secondly,  off-farm a c t i v i t i e s  1985a)  of  role  problems  i n c r e a s e s the income of the r u r a l poor  1984).  example, the ILO  employment  the  r e s p e c t , these  provide a d e f i n i t i o n a l  and  aspect  t o a decrease  Sethuraman,  the  highlighted  i n that  development. In t h i s the growth of RNA  identified  and  consistent  comparison.  40  S e v e r a l o t h e r case or country s t u d i e s have a n a l y s e d t h e interrelationship non-farm Asian  between  sector.  countries  the  Oshima's  agricultural  (1984)  proved t o be  comparative study  an  important  t h i s r e s p e c t . He analysed the t r a n s i t i o n to  non-farm  using  activities  macro-level  done by Chada and Shand  i n Japan,  statistics.  sector  and  types  (1985) on I n d i a , Kasryno  changing  and  since  RNA  1950.  in  In the  c o u n t r i e s p l a c e d emphasis upon industrialization. employment  South of  this  development  of  of  rural  (1985) on  has RNA  Ho  area  the  LDCs  fifties,  and  more  conclude  positively to  has  also  many  contributed  forms o f  the  development  of  and i t s Recent  rural to  been  developing  attention.  that  between  industrial  the  employment  the  national  (1979 and 1982), analysed the h i s t o r i c a l growth  i n d u s t r i e s i n Taiwan and South Korea and confirmed  policies  aimed  and t h e growth of RNA. the  were  Indonesia  import s u b s t i t u t i o n  received  t h a t t h e development of r u r a l supported  in  Korea  work  But l a t e r r u r a l i n d u s t r i a l i z a t i o n  potential  in  economy.  East  (1985) i n M a l a y s i a .  industrialization  growth  of  of farm households  The approach t o the study of the r e l a t i o n s h i p  studies  the  contribution  Taiwan  Similar  and  at  Minami  technological diffusion  industries  i n those  countries  integrated  rural  development  and Makino  (1985) noted t h a t  of power looms i n Japan was  of  s i m i l a r importance. Finally, Asian  several  experience  studies  of RNA.  attempted t o  I t was  noted t h a t  synthesize ".  .  .  the the  41  off-farm  activities  countries Such  a  from  growth  stages of RNA  low  to  with  higher  pattern  has  the  progress  stages"  been  (Oshima,  synthesized  of  (Thailand)  (1984  and  conference  1985a) and  r e p o r t on  into  several  t o i n the  i n the 1983  Off-Farm  Asian  1985a:12).  growth. T h i s s y n t h e s i s i s r e f e r r e d  w r i t i n g s of Oshima Mai  increase  Chiang-  Employment  in  the Development of R u r a l A s i a . The of  Chiang-Mai conference  employment  transition  from  report indicated agriculture  to  four  stages  industry  and  then t o s e r v i c e s e c t o r s i n the r u r a l a r e a s . A c c o r d i n g t o the conference  report,  equilibrium  the  stage".  predominantly  The  rural  agricultural.  labour  f o r c e i s engaged  first  stage  productivity  first  (Oshima, i s low  is  a  economy  in  this  About  2/3  or 3/4  in agricultural 1985a  and  stage  and  stage.  supplementary  The  and  at t h i s  productivity  infrastructure.  total in  changes proceed  stage. stage, changes may through Labour  changes  be brought  about by  i n technology,  absorption  in  will  the  crops  agriculture  t y p i c a l l y be l e s s p r o d u c t i v e than a g r i c u l t u r a l  in  very  breakthroughs  l i k e l y t o i n c r e a s e . However, the non-farm s e c t o r would  The  the  r o l e of non-farm income i s e s s e n t i a l l y  In the second improved  of the  is  Agricultural  s l o w l y and do not r e s u l t i n major p r o d u c t i v i t y at t h i s  level  stage  activities  1985b).  the t e c h n i c a l  "low  is  still  activities.  t h i r d stage begins w i t h the major t r a n s f o r m a t i o n  economy. R i s i n g  generate  a  demand  agricultural for  p r o d u c t i o n and  agricultural  inputs,  income  consumer  42  goods and  services.  employment rural  are  a result,  c r e a t e d which  economy. In t h i s  are competing the of  As  rapid those  new  lead  situation,  forms and  to  the  changes  the non-farm  w i t h the farm a c t i v i t i e s .  The  labour  force  in rural  in  of the  activities  final  d e c l i n e of labour i n a g r i c u l t u r e ;  i n the  sources  stage i s  the m a j o r i t y  areas  will  now  be  employed i n the non-farm s e c t o r . Oshima countries  (1985a)  into  attempted  to  categorize  the above stages of RNA  words, "Japan has completed  the  later  the l a t t e r stage w i t h the l a b o u r  1970s. Taiwan and  the  agricultural  the  early  stage  and  industrial  of the  South  Korea  transition  industrial-service  China,  Indonesia,  India,  and  labour  have and  completed  are  now  in with  Philippines,  S r i Lanka i n the middle  Burma, Bangladesh,  force  transition,  M a l a y s i a i n the l a t e r stage of the former. The Thailand,  Asian  development. In h i s  f o r c e i n the s e r v i c e s exceeding the i n d u s t r i a l in  the  stage  Laos, Nepal, Vietnam  and  still  i n the e a r l y s t a g e " (Oshima, 1985a: 21).  2.3  Conceptual Model of the Growth of  The  c o n c e p t u a l scheme  of the growth of RNA,  e m p i r i c a l e x p e r i e n c e of LDCs, i s used of RNA  i n S r i Lanka.  t o guide the  based  on  analysis  The schematic r e p r e s e n t a t i o n of t h i s  model i s shown i n Diagram 2.1a  and 2.1b.  helps* t o e x p l a i n the short-term Lanka.  RNA  This  scheme  employment changes i n S r i  43  Diagram affecting an  2.1a  factor  and  supply  Intervention  factors  as  o f t h e s t a t e as  influencing  demand and s u p p l y  effects  i s shown i n Diagram 2.1b.  The r e l a t i o n s h i p s  of the  background  variables  unidirectional. factors  o f RNA  involved  In  schematic  i n these  two  diagrams  reality,  the  relationships  a r e not u n i d i r e c t i o n a l  in this  presenting  the  demand  t h e growth of RNA.  additional  on RNA  shows  process  a r e seen  since  are i n t e r r e l a t e d .  between  the  factors  The  aim o f  the u n i d i r e c t i o n a l r e l a t i o n s h i p of v a r i a b l e s form  changes  i s to illustrate  i n RNA.  The  as  in a  the s i m p l i f i e d p r o c e s s o f  necessary  q u a l i f i c a t i o n s to the  l i m i t a t i o n s o f t h i s model are g i v e n i n t h e i n t e r p r e t a t i o n o f the a n a l y s i s o f RNA growth. The  assumptions  regarding  the growth  of  RNA  relate  c l o s e l y t o Oshima's four stages o f t h e growth o f RNA i n t h a t one  may expect RNA t o grow when a country undergoes economic  growth from "low l e v e l " e q u i l i b r i u m dominated by a g r i c u l t u r e to  a  more  urbanized  developed  country  in  which  most  employment i s i n s e r v i c e s and i n i n d u s t r y . Where t h e model d i f f e r s from more c o n v e n t i o n a l model o f l a b o u r f o r c e change i s i n emphasizing t h r e e elements. 1) The importance o f the r a t e o f p o p u l a t i o n  growth and  i t s e f f e c t s on t h e labour supply i n r u r a l a r e a s . 2) The important r o l e of s t a t e t h a t which i n c r e a s e s 3)  The  i n j e c t s investment  demand f o r labour i n r u r a l a r e a s .  importance  o f improvements  i n transport  which  make non-farm a c t i v i t i e s more a c c e s s i b l e t o r u r a l p e o p l e .  44  As  Diagram  2.1a  shows,  RNA  could  expand  through  an  i n c r e a s e o f demand on the one hand and supply on t h e o t h e r . First,  the  early  stages  adds  t o the t o t a l  years  when these  number  of  rapid  expansion of  of dependants w h i l e  persons reach  numbers i n t h e labour f o r c e .  adulthood  population  after  they  a  few  i n f l a t e the  In the absence o f s i g n i f i c a n t  economic growth, the i n c r e a s e i n the labour f o r c e i s l a r g e l y related  to  supply  the  i n the  growth labour  i n RNA  through the  market.  This  situation  d i s g u i s e d unemployment or under-employment. rates  are  low  labourers since this  need  and some  employment kind  of  i s due  In t h e Supply Determined i s mostly  characteristics employed low. of the  Such a s i t u a t i o n  skill,  quality  RNA  tend  productivity  t o be  of  found, any  RNA  labour  the  activity growth i n  and  Growth S i t u a t i o n ,  part-time,  so i s  seasonal  and  labour has  Even the f u l l - t i m e  The r e t u r n  the RNA  f o r the work done i s  i s not conducive t o t h e  improvement  of work and even t h e h e a l t h c o n d i t i o n s o f  worker because i n a s i t u a t i o n  wages  through  t h e wage  growth.  of under-employment.  are poorly paid.  easily  labour  encourages  Though  t o them. The  t o the supply  c a l l e d supply determined RNA  participation  not  income  t h e work means s u r v i v a l situation  is  surplus  depressed  performance  of o v e r - s u p p l y o f  (Lipton,  1983:  97-99).  labour The  of the r u r a l e s t a b l i s h m e n t s which  Diagram  2 1 a : Conceptual Scheme of RNA Growth  RNA  Growth  Surplus Labour T3  ai c  Demand for RNA  (Rural unemployment  Labour ( skilled and  and under-employment  unskilled )  t  Diminishing Resources per family )  t  a.  t  Population Increase  IS)  T1 CL  Demand for Non - a <2_ a farm products and o » services  (e.g. Less Land Available  CL  a ro 3 a  3  n>  Economic Growth  (Dependant and Labour  ex  (Structural change )  Force Population Increase)  Diagram 2• 1 b-. Role of State in RNA Growth  RNA  Growth  Economic Growth  Population Change  State  46  employ  those  RNA-related workers  labour p r o d u c t i v i t y  i s also  poor  due t o low  and the l e v e l o f technology. RNA  i n t h i s s i t u a t i o n i s s a i d t o be of a " d i s t r e s s t y p e " 1984)  and such RNA  activities  encourages " m u l t i p l i c i t y "  growth  created The  quite  associated  with  a different  structural  i n that  labour  changes  situation  force  movement  i n employment  (see Diagram 2.1a), t h e labour economic  situation  i n economy  development  i n t h e growth  increase  will  be through new  (young age labour  force)  of  has RNA.  t h e demand f o r  l a b o u r p a r t i c u l a r l y f o r the non-farm workers. RNA  (Islam,  (White, 1976).  In t h e second s i t u a t i o n force  growth  The growth o f  entrants  t o the  and/or t h e s e c t o r a l  o f labour from farm t o non-farm s e c t o r .  This  of RNA growth i s o f a p r o g r e s s i v e type and i s c a l l e d  type  demand  determined RNA growth. The r u r a l non-farm s e c t o r i s more c o m p e t i t i v e and more efficient The  i n t h i s s i t u a t i o n than i n the p r e v i o u s  competitiveness  of t h i s  sector  comes  from  situation. the higher  p r o d u c t i v i t y o f t h i s s e c t o r . Higher p r o d u c t i v i t y i s a c h i e v e d through and  advanced  other  technology,  improvements.  increased  These  types  capital  of establishments  r e q u i r e both s k i l l e d and u n s k i l l e d l a b o u r e r s . situation especially  a r e h i g h e r and a t t r a c t from  farm  activities.  investment  labour  Wages i n t h i s  from o t h e r  Those  may  workers  sectors in  RNA-  r e l a t e d work earn a r e l a t i v e l y h i g h e r income i n r e l a t i o n t o time  spent.  Increasing  household  income  encourages  i n c r e a s e d l e v e l o f s c h o o l i n g f o r c h i l d r e n and s i n c e t h e c o s t  47  of c h i l d - r a i s i n g size  of  i s high,  families.  i n the The  i n labour  labour  production  Leidholm,  a  are  1979) .  The and  further  the  economy e x h i b i t s  resources,  capital  secondary  sector  tertiary  sector's  sector's  employment  resource  areas  for  demand  for  lead  employment  development and  i s undoubtedly  demand  the  for  important  (Chuta non-  establishments If  the  growth i n terms employment  the  later  the  stage,  the  the  secondary  The  growth  of  products  of  in  integrated  d i v e r s i f i c a t i o n of  f o r the  and  rural  workers.  1979). the  encourage  new  overtakes  (Gregory,  external  of  the  In  economy  existing  significant  faster.  "backward"  rural  rural  technology,  grows  utilization The  i n the  creation  demand  and  with  expansion of  particular  sectoral rural  and  demand s i t u a t i o n  associated  linkages  farm e s t a b l i s h m e n t s to  the  growth  d i v e r s i f i c a t i o n of economic a c t i v i t i e s .  integrations  "forward"  sector.  increase  f a c t o r s i n d i c a t e d under the  Sectoral  lead  force  population  the  market.  t o the expansion and  and  i s a tendency t o reduce  Decreases i n the  subsequent d e c l i n e labour  there  the  from  rural  non-farm the  growth of  rural  RNA  (Ho,  1985). A p a r t from demand and most  influential  supply of RNA  factors  stimulating  economic  population  changes  and  direct  indirect  i n t e r v e n t i o n of the s t a t e .  and  schematic  representation  employment  growth, one  of  the  changes  state's  in  role  the  growth,  LDCs A  of  is  the  simplified within  the  48  p r o c e s s of demand and supply  RNA  growth mechanism  i s shown  i n Diagram 2.1b. Several  studies  McGee, 1985; K o h i l i , found  that  the  (e.g.,  e t a l . , 1984  impact  significant  For  example,  'Inequality  policies  on  the r e -  and a c t i v a t i o n of economic growth  i n the LDCs p a r t i c u l a r l y Kohili,  Armstrong and  and R i d d e l l , 1985b) have  of government  d i s t r i b u t i o n of resources is  Chenery, 1979;  et  i n the T h i r d  a l . (1984)  i n recent  in  World' found  their  that  years.  study  the  on  short-term  changes i n T h i r d World c o u n t r i e s are o f t e n best e x p l a i n e d  by  the n a t u r e and p o l i c i e s of the s t a t e . Some governments are  authoritarian.  regardless  i n LDCs are democratic  As  Kohili,  et a l .  o f the form of government  authorities  periodically utilize  (1984)  al.  ,  1984:  303).  interference often to  the  state's  (1985b)  says  In  the  action  in  I t acts  redistribute  from  one  another:  through  wage the  by  means  legislation; like"  (e.g.,  Kohili,  Riddell,  1985b;  of  the of  541).  the  taxation  As  a  1985b;  and  aspects  regard Riddell  so  as t o  economy  of  policies;  number  state's  With  political  differential  (Kohili,  the  fashions  establishment  e t a l . , 1984) Moore,  economic  state  authority  change"  respect,  i n numerous  part  through  (1985b:  the  indicated,  autonomous  a f f e c t s the whole economy.  "...  corporations;  this  others  i n LDCs "...the  they possess t o mould processes of s o c i a l et  while  government v i a minimum  import, d u t i e s , of  country  Ratcliffe,  to  and  cross-sectional studies 1978)  (e.g.,  show  the  49  s h o r t - t e r m impact  of s t a t e p o l i c i e s was  significant  i n LDCs.  The changes i n employment are no e x c e p t i o n i n t h i s r e s p e c t . Previously situations  described  of RNA  h y p o t h e t i c a l demand  growth need t o be  and  qualified  proposed c o n c e p t u a l scheme i n r e a l s i t u a t i o n s .  to  supply  suit  the  I t should  noted t h a t i n s t e a d of one type, both types of RNA  be  growth are  e v i d e n t i n most p l a c e s i n LDCs. In most cases, both t y p e s of RNA  exist  s i d e by  populated  resource-scarce  significant whether  s i d e i n LDCs p a r t i c u l a r l y  it  is  supply-based  of  variations  i n RNA  the  to t h i s  both.  As  or  demand-based  indicated,  growth are a l s o  the  important  question. Therefore,  which i n c o r p o r a t e s the analyses of the RNA  What  densely  is  a t t h i s p o i n t would be the d i s t r i b u t i o n  combination  answer  countries.  i n the  or  more of  RNA  is  a  geographical i n determining  a research spatial  design  aspects  of  growth g r e a t l y a i d s the understanding of t h i s p r o c e s s . With these  aims i n view, the t h e s i s  r e s e a r c h d e s i g n t h a t attempts t o analyse how  proceeds w i t h the s u p p l y  a  and  demand f a c t o r s operate t o i n f l u e n c e the r e g i o n a l v a r i a t i o n s i n the growth of RNA  i n S r i Lanka.  50  2.4  The  2.4.1  D e f i n i t i o n of  The  No  RNA  Problems of D e f i n i t i o n of  uniform  definitions  definition  which  varied according ILO  study  is  hampered  were used  RNA  is  available  for  RNA.  The  by  d i f f e r e n t researchers  t o the purpose of t h e i r a n a l y s i s . A  (1983a: 7) by  acknowledged t h a t  an  absence  of  a  the  recent  analysis  clear  and  have  of  RNA  consistent  d e f i n i t i o n a l framework. D e f i n i t i o n a l problems a r i s e when i s defined and  i n terms of type of occupation,  the p l a c e where RNA With  Oshima not  regard  (1984: 30)  included  activities and  to  f o r e s t r y and  categories  such  the  the  include  occupational  farm  RNA  categories  are  fishing,  includes  manufacture,  of  employment i n r u r a l  activities  agriculture,  thus, as  economic a c t i v i t y  i s c a r r i e d out.  s t a t e d t h a t the  in  RNA  the  trade,  RNA.  areas  The  animal broad  RNA,  farm  husbandry  occupational  transportation  and  services. RNA The RNA  i s also defined  by the  source of household  non-farm household income comes from the such  as  industry,  r e c e i v e d from two self-employment which  are  trade  and  main sources. and  received  the  second  from  One  services.  income.  sub-sectors  of  The  is  income  i s the net e a r n i n g s from  i s the  wages  non-agricultural  d e f i n i t i o n excludes a number of other  and work.  salaries This  sources from where the  non-farm income c o u l d be r e c e i v e d . For example, the t r a n s f e r  51  of income (remittance, s u b s i d i e s ) and p r o p e r t y income ( r e n t , earnings  from  fixed  as  non-farm  considered  assets, income  Conference Report, 1985: The  second  interest) (Ho,  must  1985:  6;  also  Chiang-Mai  28) .  definitional  problem  i s the  difficulty  d i s t i n g u i s h i n g between farm and non-farm a c t i v i t i e s . rural and  level,  the  occupational  o v e r l a p with  one  activities  another.  to  separate  employment  activity  employment  category.  Since also  the  involved  categories  are  and  in  above  the  identified  with  non-farm  further  confusion  off-farm  worker  of  the  activities  are used synonymously. The farm means self-employed  into  employment  broader  a c t u a l work done i s the  are  occupational "off-farm"  usually  respectively.  equated There  occupations occupations. have  been  defined.  defined  earlier  However, used  in  both  the  1985:319).  are  not  terms  literature  the  same  without  on-  o f f - f a r m means  So,  (non-farm  is  "non-farm"  i s t h a t by d e f i n i t i o n  i n a g r i c u l t u r e and  (Choe,  a  performed  employed by o t h e r s e i t h e r i n p a i d a g r i c u l t u r a l a c t i v i t i e s non-farm  non-  or by  a  terms " o f f - f a r m " and reason  the  situation,  the  "on-farm" work and activities  when the  In t h a t  situation,  as  farm and  categorize  the  context  and  and  put  spatial  work. On-farm farm  and  At  of  interrelated  by the same person  d i f f e r e n t member of the same household. is difficult  are  In many cases,  farm a c t i v i t i e s are c a r r i e d out  it  be  or  non-farm as  and being  off-farm off-farm) clearly  52  The  term  the f i e l d  'rural  of r u r a l the  area'  as  areas.  T h i s method of  areas  approach" which has  by  which  are  not  definition  been  agencies  included  and  Population  size  However,  the  separate  rural  India  to  is  size  of  areas  10,000  used  as  the  "residual  (Choe,  population  this  area w i t h engaged  more than  an  primary which  criterion. is  v a r i e s from  Philippines.  This  (Mukhopadhyay and  Lim,  used  to  5,000 i n is  often  rural.  o c c u p a t i o n a l c r i t e r i o n whereby  a certain  in agricultural  The  respect.  a s s o c i a t e d w i t h a p o l i t i c a l d e f i n i t i o n of urban and In some cases,  1985:  purposes.  in  the  from urban areas  in  urban  used i n many p o p u l a t i o n  limited  the  are  the  administrative  is  often  areas  are made i n s e v e r a l c o u n t r i e s  for  surveys  in  i n the  i s called  d e f i n i t i o n of ' r u r a l a r e a ' which was censuses  concept  rural  f o l l o w e d world-wide  S t a t i s t i c a l collections  government  confusing  studies. Conventionally,  defined  315).  i s another  percentage of the  activities 1985:  5). On  population  i s designated the whole, the  as  rural  official  d e f i n i t i o n of r u r a l area v a r i e s c o n s i d e r a b l y from c o u n t r y country. if  one  with  As Mukhopadhyay and has  the  t o understand  (1985) i n d i c a t e ,  s t r u c t u r e of  of the system, one  .  . .  l i n k a g e s of  RNA  'rural  a r e a s ' s t r i c t l y o f f i c i a l l y d e f i n e d , t o s m a l l town and  'rural  with  (Mukhopadhyay and refined  a Lim,  has  11  to  t o look beyond  centres'  rest  the  Lim  an  predominantly 1985:  rural  hinterland"  5). Many r e s e a r c h e r s used  d e f i n i t i o n of r u r a l area and found a q u i t e  this  different  53  and  useful result  1985;  in their  i s great v a r i a t i o n  s e r v i c e s and p r o d u c t i o n  group  those  sector  11  on  .  .  activities .  types  of  Choe,  commodities,  of unpaid  the  into  Mukhopadhyay (1985) attempted t o two  sub-sectors.  The  first  runs more or l e s s on a s t a b l e b a s i s w i t h  an  and growth u s i n g h i r e d l a b o u r  degree of t e c h n o l o g i c a l s o p h i s t i c a t i o n "  same time,  author,  i n the  into  surplus generation  certain  2.4.2  1985;  a c t i v i t i e s t h a t can be grouped  the r u r a l non-farm s e c t o r .  line  Ho,  Anderson and L e i s s e r o n 1980). There  eye  a n a l y s i s (e.g.,  and  second s e c t o r runs s e a s o n a l l y w i t h  and  at  the  the help  f a m i l y workers, u s i n g p r i m i t i v e technology.  however, acknowledges t h a t t h e r e are always  The  border-  cases.  The  D e f i n i t i o n and  the Measurement of RNA  in this  Study  The  definition  research.  As  economic  activities  complex.  As  l i m i t s the  a  of  RNA  depends  i n d i c a t e d , the in  result,  many  the  on  numerous LDCs  of RNA.  go beyond the c o n v e n t i o n a l c a t e g o r i e s of This research RNA  in  the  Activities the  rural  study outside areas  i s based on of  the  growth  agriculture, are  the  rural  scope  of  changes  in  been  rapid  have  conventional  scope of the study  the  definition The  the  rural and  of  definition  RNA must  RNA.  following d e f i n i t i o n of  RNA  fisheries, non-farm  in and  Sri  Lanka.  forestry  activities.  of  in  Such  54  a c t i v i t i e s i n c l u d e manufacturing, c o n s t r u c t i o n , s e r v i c e , and transportation addition  that  t o these,  are located  i n the r u r a l  some n o n - t r a d i t i o n a l  areas.  a c t i v i t i e s such as  d a i r y farming and p o u l t r y r a i s i n g a r e a l s o i n c l u d e d The reason f o r i n c l u d i n g these a c t i v i t i e s i s t h a t they  are increasingly  similarity  capital  to a factory  than  In  intensive a farm.  i n RNA.  generally  and bear  greater  In t h e S r i Lankan  c o n t e x t , such a c t i v i t i e s as y e t form o n l y a s m a l l p r o p o r t i o n of  economic  activities  activities  may a l s o  activities  o f peasants  in rural  areas.  Though  occur t o g e t h e r w i t h o t h e r they  are r a r e l y  these  agricultural  regarded  as major  are geographically l a r g e r  than t h e  a g r i c u l t u r a l a c t i v i t i e s by the censuses. The  rural  areas  " o f f i c i a l " d e f i n i t i o n . In t h i s r e s e a r c h , r u r a l a r e a s i n c l u d e s m a l l towns and market towns because  i t has been found  economic a c t i v i t i e s and r e s o u r c e m o b i l i z a t i o n  occur  areas broader than t h e designated r u r a l f o r census Since  RNA  i s diverse,  usually  p a r t - t i m e , and i s performed on  farms  and i n s m a l l  small-scale,  in rural  within  purposes.  seasonal  by farm and non-farm  farms  that  areas.  and  households This  is a  l e g i t i m a t e expansion o f the g e o g r a p h i c a l d e f i n i t i o n . The the  empirical  measurement  activities.  As  interrelated. activities in  study o f RNA a l s o and  are c a r r i e d  the r u r a l  categorization  indicated, Some  areas.  i n v o l v e s problems i n  of  rural the  economic  different  of  a c t i v i t i e s are tasks  out by the same person In a d d i t i o n ,  RNA-related  of  these  o r household  most o f t h e RNA-related  55  activities  are  Therefore, one  of  analytical  related  activities study  the  employment permit  the  part-time  problems  to  the  and  types  i n the  of  seasonal.  activities  study  categorization  on  macro  activities  the  level  macro-level by  of  of  statistical  of  the  i n many LDCs.  measurement  and  statistical  primary  measurement  commonly found in  be  RNA.  is The  occupational  (farm and non-farm) i n c r e a s e f u r t h e r when the  i s based  example,  to  s e p a r a t i n g the d i f f e r e n t  the  problems  found  materials.  materials  occupation  For  provide  which  occupational  RNA  do  not  multiplicity  S i m i l a r l y , such problems e x i s t  c a t e g o r i z a t i o n of  rural  areas  and  source of income as w e l l . In o r d e r the  t o t a c k l e these problems the  following  r e s e a r c h framework based on  data c o l l e c t i o n , are macro The  aim  analyse  p r o c e s s i n g and  (national),  of  proposing  the  meso this  geographical  study  uses  order to a r r i v e  the  data  The  ( r e g i o n a l ) and research  of  RNA  generated  the  a t a more a c c u r a t e and  weakness  of  statistics requirements  materials.  the  nature  have  been  of  the  of  three  of  levels  (village).  is first,  to  in  to  order  second p a r t of  a l l three reliable  levels  in  p i c t u r e of  i n S r i Lanka.  macro-and meso-level  secondary  at  The  proposes levels  micro  framework  variations  the growth and extent of RNA The  three  analysis.  i n v e s t i g a t e the u s e f u l n e s s of the model. the  study  analyses The  analysis  statistics  re-grouped definition  are mainly  in of  RNA  at  recognizes  those  order  based  on the  levels  and  meet  the  to  described  earlier.  56  The  research  flexibility the  at  the  village  i n the c o l l e c t i o n ,  statistics  and permits  level  provided  processing  some c r i t i c a l  and  greater  a n a l y s i s of  e v a l u a t i o n of the  v a l i d i t y of the macro and meso data.  2.5 The Study o f RNA  Research early  i n S r i Lanka  on the growth of RNA  stages.  On  the  i n S r i Lanka  available  macro-level  is in i t s statistical  i n f o r m a t i o n , i t appears t h a t i n 1950, more than a q u a r t e r of the  total  activities.  labour The  force  S r i Lankan  was  engaged  level  of RNA  in  at that  higher  than i n s e v e r a l other c o u n t r i e s . ( 4 )  of  however,  RNA,  1950  and  i t was  RNA-related time  was  The p r o p o r t i o n  grew s l o w l y d u r i n g the t h r e e decades s i n c e much l e s s than p o p u l a t i o n and l a b o u r f o r c e  growth i n the p e r i o d . ( 5 ) The  S r i Lankan  experience  number o f q u e s t i o n s . structure scarce  First,  of low RNA  has the S r i Lankan  raises  LDCs?  If  so,  what  factors  the d e f i n i t i o n used? Secondly, factors  a s s o c i a t e d with  have  led  a  employment  " f r o z e n " as i n s e v e r a l densely p o p u l a t e d  s t a g n a t i o n ? Does the growth of RNA  the  growth  resource to  such  seem slow as a r e s u l t  of  how are the growth of RNA  and  the RNA  growth t r a n s l a t e d  into  the s p a t i a l context? Does the focus on s p a t i a l v a r i a t i o n s i n RNA  growth p r o v i d e b e t t e r understanding  the growth of RNA?  i n the a n a l y s i s o f  57  This  study  analyses  the  growth  of  RNA  i n S r i Lanka  s i n c e the e a r l y 1950s and i d e n t i f i e s the p a t t e r n s over a p e r i o d a t the m a c r o - l e v e l .  T h i s a n a l y s i s attempts t o  examine the reasons f o r the slow growth of RNA and  1980.  The  variations RNA  and  thesis identifies  i n o r d e r t o explore  concerning  also  the  analyses  the p o s s i b l e  regional study respect  of  RNA.  The  t o the growth of RNA  l e v e l s i n S r i Lanka.  of  these  1950  geographical  spatial  patterns  of  the accuracy of macro g e n e r a l i z a t i o n  growth  i s utilized  between  the  thesis  c o n c e p t u a l model t o help e x p l a i n the main contributed  o f growth  to test aims,  the  factors that  have  a t the n a t i o n a l as w e l l  Finally,  study  as  the data i n v i l l a g e  the v a l i d i t y  the  utilizes  of macro d a t a .  proposes  the  In  following  hypotheses.  2.6 Major Hypotheses  The have  following  been  presented  tested  are some of the major hypotheses which  i n the t h e s i s .  and t e s t e d  S p e c i f i c hypotheses a r e  a t each l e v e l  ( n a t i o n a l and  regional)  of a n a l y s i s . 1.  At  significant and  i t s age  the  national  economic  level,  in  growth, the changes  structure  largely contribute  the  absence  i n the  of  population  t o t h e growth of  RNA. 2. factor  At  the  i s not  regional  consistently  level, related  however,  the  population  t o the growth  of  RNA.  58  Instead,  the  influenced  variations  in  different  by a g r o - e c o l o g i c a l ,  types  socio-economic  of  RNA  and  are  political  factors. 3.  The  direct  and  indirect  i n t e r v e n t i o n of the  s i g n i f i c a n t l y c o n t r i b u t e d t o the growth of The data  study  i n the areas  concerned  with  historical from  and  as  spatial  type  of  in  October  S r i Lanka  1987. of  This  data  survey  transition  in  statistical  materials  from  field  observation  1) Sri  between  a  Lanka,  data  i t requires information  micro  (village)  of t h i s  July  study.  2)  for  field  1986  following  literature  secondary  and  study i s  i n S r i Lanka. The  i n c l u d e d the  collection:  qualitative  i n f o r m a t i o n needed  conducted  employment  depth  the hypotheses  statistical  was  RNA,  i n f o r m a t i o n . The  study prompted a f i e l d survey  survey  of  ( r e g i o n a l ) and  are necessary t o t e s t the  and  Since t h i s  variations  ( n a t i o n a l ) meso  Therefore,  areas  growth  RNA.  quantitative  identified earlier.  as w e l l  macro  levels  this  r e q u i r e s both  state  and major  survey  on  collection  of  sources,  collection  rural  l o c a t i o n s i n S r i Lanka.  field  survey i s d e s c r i b e d i n Appendix 1 of t h i s  and in  The methodology used  3)  in-  specific in this  thesis.  59  Notes 1 " D i s t o r t i o n " r e f e r r e d t o here r e l a t e s t o the i m p e r f e c t i o n i n the o p e r a t i o n of supply and demand f a c t o r s of l a b o u r because of s e v e r a l c u l t u r a l and other i n f l u e n c e s . 2 A good example t o t h i s i s a r e c e n t work by Page and S t e e l (1984) on Small E n t e r p r i s e Development: Economic Issues from A f r i c a n Experience. 3 These d e f i n i t i o n s are d i s c u s s e d i n s e c t i o n 2.4.1. d e f i n i t i o n of RNA used i n t h i s t h e s i s i n e x p l a i n e d s e c t i o n 2.4.2 below.  The in  4 For example, i n the e a r l y s i x t i e s the p r o p o r t i o n of employed engaged i n RNA i n S r i Lanka was 3, 15, 16 and 21 per cent h i g h e r than the p r o p o r t i o n i n P a k i s t a n , India, South Korea and Bangladesh r e s p e c t i v e l y . 5 During the p e r i o d 1948 t o 1988, p o p u l a t i o n grew a t a r a t e of two per cent per annum while RNA grew by l e s s than one per c e n t .  60  CHAPTER THREE: RURAL NON-FARM ACTIVITIES IN ASIA, 1950-80  This  chapter  variations chapter  of  are  growth  and  contributed Asia.  to  identify  RNA  to  different  growth  types  of  the  processes  of  25  Middle  world  East)  of  the  main  aims  RNA  spatial of  this  v a r i a t i o n s of  mechanisms growth  of RNA  The  Asia  small which  population.  economic,  aspects.  usual  which  RNA have  patterns  in  i n S r i Lanka i n  and  These  social,  standards  Asia  (using  measure), the income  (per  e l e v e n middle  capita  income  GNP  In  per  c o u n t r i e s are  than  (per c a p i t a GNP market  A l l the  countries  economies but  the m a j o r i t y  economies are  either  US  economy  of the  countries) economic  GNP(l) into  $410  as  in  capita  Asia  East and  are  a  thirteen 1982) ,  $410-1650) and  (per  i n South  includes  terms of  US  in  historical  (seven  capita  half  vary  Asia  re-grouped  less  industrial  of  Asia  (ten c o u n t r i e s ) .  Asian  more than  and  division  Bank's  countries  countries  cultural  geographic  World  large  comprise  ( e i g h t c o u n t r i e s ) , East  Southeast  $10,120).  The  the g e o g r a p h i c a l  the  total  (Japan)  in Asia.  identify  geographic,  low  overview  to  consists  (excluding  and  growth  an  setting.  Asia  South  RNA  This analyses  the A s i a n  the  presents  GNP  low  Southeast  o i l e x p o r t i n g or o i l i m p o r t i n g  one US  income Asian middle  income economies a c c o r d i n g t o the World Bank c l a s s i f i c a t i o n . The  World  Bank  characteristics  of  grouping RNA  change  is over  used a  to period  analyse in  the  different  61  countries.  S r i Lanka  falls  w i t h i n the South A s i a n  region  and i s grouped with t h e low income d e v e l o p i n g c o u n t r i e s . This  examination  of RNA  growth  i n Asia  focuses  on  s e l e c t e d c o u n t r i e s due t o the n o n - a v a i l a b i l i t y o f comparable statistics  f o r a l l of them. The d i s c u s s i o n i n t h i s  chapter  r e f e r s t o t h e p e r i o d 1950-80.  3.1 Changes  i n Asia  Tables  3.1a and 3.1b g i v e  some  basic  indicators f o r selected countries i n Asia. have been p r e s e n t e d performance related  over  these  a may  the l a s t  period be  situation  thirty  regarding  have  years.  been  The  following  t h e changes  decades. F i r s t ,  inter-  i n Asia  i t i s evident  from  t a b l e s t h a t t h e r e were only minor d i f f e r e n c e s i n t h e  socio-economic nineteen  and  fifties  demographic  among these  the n i n e t e e n e i g h t i e s had emerged. while  of  made  three  These i n d i c a t o r s  show how p o p u l a t i o n growth, economic  and t h e employment  observations during  to  socio-economic  Asian  in  growth  the  early  c o u n t r i e s . However, by  marked v a r i a t i o n s i n these i n d i c a t o r s  For i n s t a n c e , East A s i a was r a p i d l y  economic  countries.  indicators  was  slower  i n many  developing  other  Asian  T a b l e 3 . 1 A E c o n o s u and D e e o g r a p h i c i n d i c a t o r s f o r S e l e c t e d C o u n t r i e s i n A s i a , 1950-1980 ( S e l e c t e d Y e a r s ) .  1 Total opulation • a i l lion> 1980  I Increase Population 1950-1980  37.8 675.2 143.0 38.1 13.7 14.0 82.1 48.3 14.7 17.7 46.5  114 92 96 87 120 70 126 131 92 124 125  p  Country Bangladesh India Indonesia Korea (South) Malaysia Nepal Pakistan Philippines S r i Lanka Taiwan Thailand  o  -1  4  I  of R u r a l Population 1960 1980 95 82 85 72 75 97 78 70 82 64 87  89 78 80 43 71 95 72 64 73 30 86  5 6 '/. of E c o n o s i c Active Population in A g r i c u l t u r e 1960 1980 87 74 75 66 63 95 61 61 56 56 84  84 63 59 39 48 93 54 46 53 28 75  7 8 Crop L a n d Per C a p i t a (ha.) 1970 1980 0.13 0.30 0.15 0.07 0.53 0.17 0.29 0.19 0.16 0.11 0.38  9 10 Average Annual Real Growth Rate of GDP Per C a p i t a 1950-60 1970-80  0.10 0.25 0.13 0.06 0.31 0.16 0.23 0.20 0.14 0.08 0.38  NA 2.0 1.9 3.0 O.B 1.0 NA 3.3 1.3 6.0 2.9  NA - Not a v a i l a b l e For Taiwan, C o l u a n s 9, 10, 11, and 12 a r e fro» S t a t i s t i c a l Yearbook o f R e p u b l i c o f China, 1987. Per C a p i t a GDP Growth f o r Taiwan i s between t h e p e r i o d 1950-55 and 1976-80.  S o u r c e s : C o i u a n s 1, 4, 6, 7, B a r e fro« A s i a n D e v e l o p n e n t Bank, 1986. C o l u t n 3 i s f r o c U n i t e d N a t i o n s , 1975. C o l u m s 5, 9, 10 a r e f r o i World Bank, 1983. C o l u n n 2 i s c a l c u l a t e d f r o d A s i a n Development Bank, 1986, and World Bank, 13B6. C o l u i n 11 i s f r o s H a r r i s and R a s h i d ^ •.  1.5 1.5 5.3 7.2 5.2 -0.5 1.9 3.4 3.0 8.4 4.6  11  12  Open U n e s p l o y a e n t O v e r a l l I Change 7. Period NA 400 336 50 -12  1970-82 1973-82 1970-82 1974-80  NA -23 53 37 -44.0 139  1971-81 1970-82 1970-75 1970-81 1972-80  T a b i e S . l B . T h e Factors Associated with RNA in Asia  1  Country  3  4  j  6  t1  7  Average Annual  Secondary School  Ka. of Railway and  X Growth of  Growth Rate of Labour Force (X) 1%5-BO 1980-85  Enrol 1 lent Ratio  Road Per Sq. Ka. X of Change 1980 1960-80  Agricultural Production 1960-70 1970-76  Banglaoesh  1.9 1.7  India Indonesia Korea (South) Malaysia Nepal  2.1 2.B 3.4 1.6 2.6  Pakistan Philippines Sri Lanka Taiwan Thai land  2.8 2.0 2.4 2.7  2.5  2.9 2.3 3.2 2.5  2.2 NA 2.8  1.6 NA 2.5  (Xi X Increased 1960 1360-80 8 20 6 27 19 6 11 26 27 NA 13  88 50 367 196 168 250 36 142 89 NA 123  1 3 4 5  Population in Agriculture 1960-80  0.06  NA  1.7  0.7  4  0.48 0.08 0.50 0.18 0.04  139 30 60 80 NA NA 235  2.1 1.7 5.7 5.3 0.4 S.2 3.2 2.7  1.5 3.7 3.7 5.4 1.0 1.7 6.0 •-0.4 3.0 3.9  15 21 41 23 2 12  0.06 0.50 0.40 NA 0.06  NA - Not available  Sources: Coluan Coluan Coluan Coluan  9 X Oecime Econoaic Active  and 2 are froa World Bank, 1987. is iron World Bank, 1983. is calculated froa World Bank, 1983. is calculated froa United nations. 1984.  Coluan 6 is calculated froa United Nations, 1969 and 1984. Coluans 7 and 8 are froa the Econoaist, 1980. Coluan 9 is calculated froa World Bank, 1985.  30 NA 64  4.5 5.4  25 6 44 11  64  I f the percentage d e c l i n e of a g r i c u l t u r a l employment i s used two  (Table  3.1b)  as  a crude measurement(2) of RNA  emerging r e g i o n a l p a t t e r n s of RNA  They are East and  South and  Asian  have  shown  a g r i c u l t u r a l employment  (e.g.,  countries  Korea 41% Such  d e c l i n e ) over  a  rapid  a s s o c i a t e d with and  other  Southeast  two  decline  a  evident  significant  the  East  decline  Taiwan 44% d e c l i n e and  agricultural  significant  in Asia.  Asia. First,  decades between 1960  in  socio-economic  are  growth,  in  South  and  1980.  employment  improvements i n  was  infrastructural  i n d i c a t o r s i n the  rural  areas  of  East A s i a . The the  following section  changes  population  in  South  and  is particularly  and  labour  As  Table  3.1a  significantly The  over  population  Secondly,  the  relatively  30  slow.  Thirdly,  measured  by  per  growth  occurred  the  years was  proportion and  Asia  the except  in  total  South  mainly of  where  with rapid  while  the  slow.  shows,  growth  high  Southeast  force  performance of the economy was  concerned  the  in  and  due  to  rural  changes over India  Southeast natural  population  a 30  the  c a p i t a GDP(3) was  population  year  Asia. growth.  remained  p e r i o d were  economic  higher  grew  growth  i n the  1970-80  p e r i o d compared t o the economic performance between 1950 1960.  Finally,  continued (except  to in  s i t u a t i o n has  the be  the  majority  concentrated Philippines) .  of  the  in  the  The  employed  been worsening i n most of these  and  population  agriculture overall  as  sector  unemployment countries  due  65  to the rapid  labour  force  increase  and t h e slow changes i n  the economic s t r u c t u r e . According rural  t o t h e FAO'S p o p u l a t i o n  population  annual  rate  o f South  estimate,  and Southeast A s i a  o f 2.03-2.23  per cent  between  the t o t a l grew  a t an  1950-80 (ILO,  1983a: 17-18). T h i s i m p l i e d t h a t t h e time i n which t h e t o t a l r u r a l population population  doubles i s l e s s than 35 y e a r s .  growth  i n these  countries  was due t o a  d e c l i n e i n m o r t a l i t y r a t e s . The p o p u l a t i o n peak  level  income  (2.3 p e r annum)  countries  compared  between  The r a p i d  growth was a t i t s  1960-70  t o the period  sudden  i n many low  1970-82 where t h e  annual average growth was 1.9 (World Bank, 1983). The r a p i d population  growth  i n the s i x t i e s  the dependent p o p u l a t i o n  resulted  i n increases i n  p a r t i c u l a r l y t h e group aged  0-14 y e a r s . As Bloom and Freedman  between  (1986: 390) i n d i c a t e d , t h e  dependency burden i n t h e LDCs was a hindrance t o development in  two main  that  the majority  minority. the  ways. F i r s t ,  the high  had t o be s u s t a i n e d  Secondly, t h e r e  social  dependency  burden meant  by t h e labour  was a g r e a t e r  i n f r a s t r u c t u r e such as s c h o o l s  of a  need t o i n v e s t i n and h o s p i t a l s due  t o t h e r a p i d growth i n t h e numbers of t h e young. The  fertility  levels  around t h e s e v e n t i e s  to  decline  which r e s u l t e d i n t h e o v e r a l l  decline  i n the rates of t o t a l the  younger  (aged  population  age groups  proportionately 15-65).  i n many  greater According  LDCs  began  increase.  of t h e p o p u l a t i o n growth  of labour  t o t h e World  Such changes i n resulted force  Bank  in a  population  publications  66  (1983),  the  grew a t  a  compared  labour f o r c e p o p u l a t i o n i n low r a t e of  to  1.7  2.0  per  per  cent  cent  per  per  income c o u n t r i e s  annum between  annum  during  1970-82  the  previous  decade (1960-70). T h i s r a p i d growth of labour f o r c e worsened the unemployment s i t u a t i o n The have  (Table 3.1b).  c o u n t r i e s under review  predominantly  Singapore  and  population economic  agricultural  Brunei.  are  (South and  The  dependent  activity  (Table  economies  majority  on  Southeast  of  agriculture  3.1a  except the  as  columns  5  decades which had the r u r a l The  their and  rice  changes  i n the  varieties  agricultural  (HYVs) of c e r e a l s ,  association  chemicals,  a  with  controlled  chemical  water  supply  c u l t i v a t i o n i n c l u d i n g mechanization  sector  existing  new  technology  s l o w l y but  under  cultivation  cultivable  lands  were  comprised especially  in  new  and  new  the  called high-  wheat  fertilizers,  steadily  through  began  and  agro-  methods  of  1986). penetrated  (and/or new) irrigation cultivated  through the use of modern i n p u t s . The r e s u l t was rapid  three  technology  (Farmer,  r u r a l a g r i c u l t u r a l economy. M a r g i n a l brought  advance  areas.  in  The  The  i t s e f f e c t s on the employment s i t u a t i o n i n  "Green R e v o l u t i o n " . T h i s technology  yielding  main  6).  and p r o d u c t i o n d u r i n g the l a s t  e a r l y 1950s w i t h the i n t r o d u c t i o n of a new the  for  employed  a g r i c u l t u r a l s e c t o r i t s e l f experienced a s i g n i f i c a n t i n terms of technology  Asia)  the  l a n d s were and  the  intensively seen i n the  i n c r e a s e i n a g r i c u l t u r a l p r o d u c t i o n . For example,  the  67  Asian food  countries grain  i n general  production  showed a remarkable  during  the l a s t  two decades  3.1b columns 7 and 8 ) , food p r o d u c t i o n doubled Philippines 39) .  increase i n (Table  i n Malaysia,  and T h a i l a n d between 1953 and 1975 (ADB, 1978:  Likewise,  South  Asian  countries  also  showed  c o n s i d e r a b l e i n c r e a s e i n food p r o d u c t i o n d u r i n g t h i s  a  period  (Farmer, 1986). Ishikawa  (1978,  1980 and e t a l . , 1982) d e s c r i b e s t h e  changing  labour  utilization  i n Asian  rice  cultivation  as  follows:  t e c h n o l o g i c a l i n n o v a t i o n ( b i o l o g i c a l , c h e m i c a l and  mechanical) i n a g r i c u l t u r a l a c t i v i t i e s g r a d u a l l y changed t h e traditional some  labour  types  inputs;  of  labour  agricultural  absorption  activity  increased i n  particularly  t r a n s p l a n t i n g and h a r v e s t i n g . These changes o c c u r r e d earlier the  stages  r a t e o f labour  Empirical al.,  o f the "Green R e v o l u t i o n "  analyses  1982),  i n Japan,  China,  (Misra,  1977  and  Taiwan  1985),  years.  (Ishikawa,  and  Amerasinghe,  i n the  However,  absorption declined i n the l a t e r  India  (Wickramasekara,  period.  in  Sri  1977)  et  Lanka  generally  c o n f i r m Ishikawa's view. Secondly, migrants  t h e expansion  towards  rural  o f a g r i c u l t u r a l lands a t t r a c t e d  areas  and absorbed  a  significant  amount o f labour i n a g r i c u l t u r e and r e l a t e d a c t i v i t i e s . Much of  this  Thailand,  labour  absorption  Philippines,  in  Indonesia  lands were a v a i l a b l e f o r expansion. developed  cultivable  lands  agriculture  occurred  and S r i Lanka  where  in new  Labour m o b i l i t y t o newly  i n these  countries,  to  some  68  extent, areas  eased  (Forbes, In  the population  pressure  i n densely  populated  1984 and Hugo, 1984).  t h e long  term,  however,  t h e new  development  a g r i c u l t u r e o f t e n n e g a t i v e l y a f f e c t e d t h e labour in  agricultural-related  of  new  cost"  seeds  (HYVs)  activities.  and f e r t i l i z e r  of a g r i c u l t u r a l  activities.  h o l d e r s who were poor farmers farm  activities.  system  i n these  children sold  causing  because  First,  In many countries  absorption  the i n t r o d u c t i o n  increased  the "input  As a r e s u l t ,  the small  were unable t o c o n t i n u e  cases, land  fragmentation.  due  was  o f i t s uneconomic s i z e .  their  t o the i n h e r i t a n c e  sub-divided  Often  in  among t h e  fragmented In both  l a n d was  situations,  i n c r e a s i n g l a n d l e s s n e s s of s m a l l - h o l d e r s was t h e r e s u l t . For example, cent  land  holdings  below  (1962) t o 42.6 per cent  one acre  rose  from  35.2 p e r  (1973) i n S r i Lanka and t o 56.5  per cent i n I n d i a . At t h e same time, new "entrepreneur from  already  rich  rural  families  access t o t h e new technology  groups" who emerged  began  t o have  greater  and t o i n c r e a s e t h e i r income as  w e l l as t o expand t h e i r h o l d i n g s by b r i n g i n g up o t h e r holdings cultivable the  (De Koninck,  new technology  Several  in  The  l a n d was advantageous  e x t e n t reduced  1982  1979).  increasing  size  small  of the  f o r t h e implementation  i n c l u d i n g mechanization.  This  of  t o some  labour a b s o r p t i o n i n a g r i c u l t u r e . macro-and  and C l e a v e r ,  micro-level  studies  (e.g.,  1974) r e p o r t t h a t e x t e n s i v e  a g r i c u l t u r e reversed  employment  absorption  Byres,  mechanization by  reducing  69  the  labour  Chapman  intake  (1982)  introduction crops  i n agricultural  noted  increased  of a g r i c u l t u r a l  i n Thailand.  activities.  Bhalla  F o r example,  landlessness  technology (1977)  due  and new  i n India  t o the  commercial  and  Morrison  (1979) i n S r i Lanka a l s o noted s i m i l a r changes. Similar  changes  Southeast A s i a n  were  also  countries.  noted  i n other  Increasing  South and  population  pressure  on l a n d and t h e absence o f land reforms l e d t o r a p i d growth in  the landless  areas.  and 'land-poor'  In a d d i t i o n  column  11  and  unemployment further  While t h e r e economic  t o t h e open 12) ,  increased  details  population unemployment  under-employment rapidly  see Uphoff  and Esman,  i n t h e urban  rural  (Table 3.1a,  and  i n the r u r a l  i s a s u r p l u s o f labour  expansion  i n many  disguised areas  (For  1974: T a b l e  12).  i n t h e r u r a l areas, sector  slow  prevented  this  s u r p l u s l a b o u r from moving i n t o t h a t s e c t o r . So,  increasing  poverty  was  noted  rural  t o an estimate,  eighties,  43 t o 70 per cent of t h e r u r a l people s u f f e r from  Lanka  i n Bangladesh, I n d i a , P a k i s t a n , (Hewawitharana,  seventies  Asia.  According  poverty  f o r the l a t e  in  P h i l i p p i n e s and S r i  1987: l ) . The l a r g e s t group  r u r a l poor i s l a n d l e s s l a b o u r e r s and 'land-poor' constitute Lee,  more  1983).  than  and e a r l y  half  Unemployment  the t o t a l and  population  under-employment  of the  people who (Khan and are  very  common i n t h e i r case ( L i p t o n , 1983 and Das Gupta, 1986). F o r example,  Misra  (1985:  2) r e p o r t s  that  i n 1980, about  21  70  m i l l i o n people were unemployed i n r u r a l I n d i a ,  about 55  per  cent of them being r u r a l a g r i c u l t u r a l l a b o u r e r s . On  the  (using GDP been  o t h e r hand i n East  A s i a , the  as a crude measure of economic development),  rapid  compared  diversification  declining  growing  urbanization  development  as  to  the  rest  of  Asia.  i n economic a c t i v i t i e s  rapidly  a g r i c u l t u r e population.  well  has  had  as  on  a  great  the  of  transportation  too  the  r o l e of the  were f a v o r a b l e  on  s t a t e and  30  rapidly  the  rural  Likewise,  literacy,  schooling  years s i n c e  export-oriented  t o economic development  the  RNA.  are r e l a t i v e l y h i g h e r and  a s i g n i f i c a n t growth over the  the  from  Thirdly,  impact  growth  has  Secondly,  i s evident  o t h e r socio-economic i n d i c a t o r s such as and  economic growth,  have shown  1950.  Finally,  economic p o l i c i e s  (see T a b l e s 3.1a  and  3.1b).  3.2  The in  3.2.1  o v e r a l l Employment s i t u a t i o n and  O v e r a l l Employment s i t u a t i o n  labour  economy i n low  the  RNA  Asia  Rapid  that  the Growth o f  the  force  growth and  income c o u n t r i e s  led to  "employment c o n d i t i o n s "  LDCs s i n c e  1950.  The  poor performance of  had  accuracy  of  a common  and  Rashid  (1984)  and  Bloom  assumption  been d e t e r i o r a t i n g  in  this proposition  has  been i n v e s t i g a t e d by Gregory (1979), B e r r y and Harris  the  and  Sabot  Freedman  (1978), (198 6).  71  They  a l l found  that  this  assumption  of  deteriorating  "employment c o n d i t i o n s " i n LDCs i s not e n t i r e l y The  following  section  reviews  situation  i n LDCs and p a r t i c u l a r l y  findings.  Changing  employment  justified.  the o v e r a l l i n Asia  situations  employment  using over  t h e above  two decades  ( i n 1960s and 1970s) a r e g i v e n i n Table 3.2. The employmentrelated  i n f o r m a t i o n i n t h i s t a b l e i s based on two  studies  (Gregory, 1979 and H a r r i s and Rashid, 1984) i n LDCs.  Using  four  occupational and  employment-related distribution  unemployment  market Table  rate),  situation 3.2).  was  criteria  of employment, the  by  them  Each of these p r o j e c t i o n s  (sectoral employment  performance  projected  different  of  LDCs'  and status labour  (see column  2 of  i n d i c a t e s t h e major  c h a r a c t e r i s t i c s of t h e labour market of LDCs. The  analyses  of  different  groups  sectional  statistics  employment  of r e s e a r c h e r s  performance were  based  f o r about 40 c o u n t r i e s  (1979) was t h a t on the b a s i s of h i s c r i t e r i a ,  conditions. Rashid  On  (1984)  unemployment,  showing  the b a s i s found  that  a  finding  worsening  of these except  of  was  by  there  employment Harris  respect  t h e labour market s i t u a t i o n  Latin  for sixties  criteria, in  two  cross-  i n Asia,  Gregory  evidence  overall  the  and  no  The  on  these  America  was  Africa.  of  of  and  open-  improving i n  the s e v e n t i e s . The employment performance can be seen from t h e changes i n t h e r a t e s of employment s e c t o r s over time as w e l l . total  and  sectoral  employment  changes f o r s e l e c t e d  The Asian  72  c o u n t r i e s a r e t a b u l a t e d from the above two f i n d i n g s f o r t h e s i x t i e s and s e v e n t i e s 3.3  i n d i c a t e s the following:  employment the  and a r e r e p o r t e d i n Table 3.3. T a b l e  growth were high  seventies  Secondly,the sectors  compared movement  First,  i n many  the rates reported  t o the s i t u a t i o n of  labour  from  countries i n  i n the primary  sixties. to  other  T h i r d l y , t h e growth  of t h e secondary s e c t o r has been much f a s t e r countries  where  significant  p r o p o r t i o n o f the t o t a l  both  total  (as t h e f i r s t p r o p o s i t i o n i n d i c a t e d i n T a b l e 3.2) i s  e v i d e n t i n most o f the A s i a n c o u n t r i e s .  the  of  growth  rapid  i n East  industrialization labour  absorbed force.  o f t h e s e r v i c e s e c t o r was r e l a t i v e l y  South and Southeast  Asian a  Finally,  higher i n  A s i a where t h e c r e a t i o n o f w h i t e -  c o l l a r employment and the emergence o f i n t e r m e d i a t e  and low  l e v e l s s e r v i c e occupations was p r e v a l e n t . With r e g a r d t o the o c c u p a t i o n a l c a t e g o r i e s ( p r o p o s i t i o n No.  2, T a b l e  3.2), a combination  especially  in  occupations  grew  changes  i n GDP  manufacturing rapidly  Asia  and f o r each  higher  between  Tables  11, 12 and 13) . On the other  service Asia  1960 and  industry-  i n East  p e r worker  of production  and s a l e s workers  but t h e r e  r e l a t e d workers.  1980  (Bloom  increased  was no a p p r e c i a b l e  and  related  white-collar  where  the  sector  overall  were  and Freedman, hand,  -  much 1986:  t h e number o f  d r a m a t i c a l l y i n South  increase  i n production-  Table 3.2: Eiployient Conditions in LDCs, 1360-1980.  Findings  Gregory's Criteria and Reasoning  For 1960s by Gregory  > For 1970 * by Harris and Rash id  Criteria  Reasoning  Sectoral Distribution of Eiployient  A transfer of labour froi agricultural to non-agricultural occupations indicates an iiproveient in average eiployient situation and living standard.  Not Deteriorating  Iiproveient  Occupational Distribution of Eiployient  'Explosive' growth in sales and service occupations indicates increased nuiber of eaployed in low productivity/low incoie jobs.  Not  Iiproveient  Eiployient Status of Eaployed Labour Force  Rapid growth in unpaid faiily workers or self-eiployed indicates a deterioration in eiployient conditions.  Not Deteriorating  Iiproveient  Uneiployient Rate  Increasing uneiployient rates indicates deteriorating labour conditions.  Not  Worsening  Source: Colums 1, 2, and 4 are froi Harris and Rashid, 1984 Tables 1 and 4. Colum 3 is froi 6regory 1979.  Deteriorating  Deteriorating  74 Table  3.3; Rates o f Employment Change by S e c t o r s A s i a n C o u n t r i e s , 1960-1980.  Countries  Rates o f Employment Change  Period  Total Bangladesh  i n Selected  Primary Secondary T e r t i a r y Sector Sector Sector  1975-81  6.6  3.3  6.7  7.4  1975-82  2.6  1.8  2.6  2.6  Indonesia  1961-71  1.5  0.6  3.8  4. 5  Korea(South)  1960-70 1971-81  3.3 3.3  1.0 -0.5  11.1 7.4  5.1 5.8  Malaysia  1957-70 1970-80  2.3 3.4  0.7 0.7  2.6 4.0  2.9 4. 7  Pakistan  1951-71 1972-82  2.7 3.6  2.5 2.5  3.8 2.6  3.1 3.6  Philippines  1965-75 1971-78  3.5 4.1  2.7 4.4  3.9 3.2  5.0 4.2  S r i Lanka  1963-71 1973-80  3.3 0.3  1.1 -0.8  1.9  1.2 5.6  Taiwan  1950-71  2.7  0.3  5.0  4.4  Thailand  1960-70 1972-80  2.0 4.3  1.5 4.0  5.2 4.5  3.7 5.2  India  Note: primary s e c t o r c o n t a i n s farm r e l a t e d a c t i v i t i e s o n l y . Secondary sector includes mining, manufacturing, e l e c t r i c i t y , gas, c o n s t r u c t i o n , t r a n s p o r t a t i o n , s t o r a g e and communication. T e r t i a r y sector includes trade, restaurant, h o t e l , f i n a n c e , r e a l e s t a t e , business s e r v i c e and community and p e r s o n a l s e r v i c e s . "-" denotes t h e i n f o r m a t i o n not r e p o r t e d S o u r c e : I n f o r m a t i o n f o r 1960 i s t a b u l a t e d from Gregory, 1979, Table 1:680-81 and f o r 1970s i s t a b u l a t e d from H a r r i s and Rashid, 1984, Table 2:275.  75  Finally,  open-unemployment  deteriorating particularly confirmed,  labour  as  the  measure  of  f o r c e c o n d i t i o n s have been i n c r e a s i n g  i n South  the  rates  (Table 3.1a).  under-employment  As  a number of s t u d i e s  situation  i s much worse i n  the  c o u n t r i e s where a g r i c u l t u r e i s the  dominant  the  labour  Esman, 1974:  absorption  (e.g.,  Uphoff and  sector  in  Table  12). Though the above f i n d i n g s p r o v i d e an o v e r a l l p a t t e r n of employment changes i n LDCs, they have t o be used c a u t i o u s l y due  to  the  (e.g.,  nature  Gregory,  acknowledge  the  of  data  1979  used  and  limitation  statistics  i n terms  of  problems.  Further,  a  the  i n the  analyses.  Harris of  and  Writers  Rashid,  1984)  available cross-sectional  small  sample  comprehensive  and  definitional  a n a l y s i s of  this  type  must look i n t o the q u a l i t a t i v e nature of employment c r e a t i o n including  labour  p r o d u c t i v i t y , wage  and  the  quality  of  labour.  3.2.2  The Growth of RNA  The was  noted  movement of  number  of  labour  i n the p r e v i o u s  growth of RNA The  i n Asia  from  farm  section.  to  The  non-farm  sectors  performance of  the  i n Asia i s discussed i n t h i s s e c t i o n .  cross-sectional analysis conceptual  and  statistical  of  definitional information  RNA  growth  problems.  provides  the  on  growth  selected  countries i n Asia. This s t a t i s t i c a l  faces Table  of  RNA  a 3.4  for  information i s  76  compiled the  from a number of r e l i a b l e sources. In most cases,  information  was  taken  from  national  surveys  of  employment covering the entire country. However, these types of  surveys  significance employment related  usually of  RNA  underestimate since  the  the  basis  i s the main occupation.  quantitative  of  measurement  Much of the  of  non-farm  work i n agrarian dominant economies i s done on  part-time and  seasonal basis.  Secondly,  d e f i n i t i o n s of r u r a l areas and RNA  a  the v a r i a t i o n s i n  too make i t d i f f i c u l t f o r  any cross-sectional comparison of the available s t a t i s t i c s . Using the Main Occupation as the c r i t e r i o n (as reported i n Table  3.4),  engaged i n RNA  a quarter of the t o t a l i n Asian countries.  rural  employed  I t i s s i g n i f i c a n t that  S r i Lanka has by f a r the larger proportion of RNA labour shift  among the  selected  Asian countries.  i n the proportion of RNA  within  each  pattern may (1979:  country  and  are  of r u r a l  However,  over the period has  sometimes  a  distinct  be discerned. In t h i s regard, Chuta and  the  varied  regional Liedholm  18) indicate that the South Asian countries such as  India experienced only about 4 per cent growth while Taiwan, (an East Asian country), experienced a 10 per cent growth of RNA  during the period 1950 to i960. Anderson and Leisserson (1980) and Ho  broader  definition  towns),  found a  of  rural  significantly  areas  (which  higher  (1985), using a includes  proportion  of  rural RNA  77  T a b l e 3.4:  Percentage of R u r a l Persons Who C o n s i d e r RNA as T h e i r Main Source of Income i n S e l e c t e d A s i a n Countries.  Country  Year  Bangladesh  1961 1979  India Pakistan  Source  of  14 26  NA National 1979.  Manpower  1966/67 NA  20 NA  NA NA  1961 1978/79  32 35  Census of Population,1963. Labour Force Survey  1963 1981  37 42  Census o f Population,1963. Census of Population,1981.  Malaysia  1970 1980  32 28  NA Census of Population,1980.  Korea(South)  1960 1980  19 28  Census of Population,1960. Census of Population,1980.  Philippines  1972  25-30  1982  32  National Sample of Household. Household Survey.  1980  35  Census of Population,1980.  Sri  Lanka  Indonesia 'NA'  Not  %  RNA  Of  Information  Survey,  Survey  available  Source:Bangladesh f o r 1961 by Ho,1985 and f o r 1979 by Ahmad and Ahamed, 1985:81; I n d i a f o r 1966/67 by Ho, 1985; P a k i s t a n f o r 1961 and 1978 by Chaudhry, 1985; S r i Lanka f o r 1963 and 1981 a r e c a l c u l a t e d from the r e p o r t s o f the r e s p e c t i v e Census o f P o p u l a t i o n (Department of Census and S t a t i s t i c s 1967b and 1983b); M a l a y s i a f o r 1970 and 1980 a r e s u b t r a c t e d from Lim, 1985c:407; Korea by Choe, 1985:407; P h i l i p p i n e s f o r 1972 from F a b e l l a , 1985c:407 and Indonesia f o r 1980 by Kasryno, 1985:14.  78  compared For  to  example,  estimates, per  the  cent  p r o p o r t i o n under  according  RNA  the  previous  t o Anderson and  i n c r e a s e d by  f o r Malaysia,  f o u r per  s i x per  definition.  Leisserson's cent  (1980)  for India,  five  cent f o r South Korea and  12  per cent f o r the P h i l i p p i n e s . Islam time  (1984),  spent  on  analysis,  on the other hand, analysed RNA  RNA-related  which  activities.  included  eleven  c o u n t r i e s , the c o n t r i b u t i o n of RNA spent  varied  from  40  per  According  villages  in  in  a  to  six  t o the t o t a l  cent  u s i n g the his  Asian  labour  time  predominantly  a g r i c u l t u r a l v i l l a g e i n c e n t r a l T h a i l a n d t o 89 per cent i n a village  with  Pakistan  rain-fed  agriculture  (Islam, 1984:  Finally,  many  f o r the  Punjab  researchers  (Chuta  and  Liedholm,  Asian  of  a n a l y s i s of RNA  income  countries confirm  income sources decades.  Chada  originating during  has  the  been  growth. Oshima's Lim's  statistics  for  South  t h a t the  share  of  10)  indicates  and  i n the a g r i c u l t u r a l 1950/51 t o  s e c t o r grew by 1980/81  (1985a) 7)  Southeast  income  that  the  (1985:  increasing s i g n i f i c a n t l y  (1985:  period  from  RNA  i n recent  the 92  income per  cent  i n India while  that  o r i g i n a t i n g from the non-farm s e c t o r grew by as much as per  cent d u r i n g the  (1985)  indicates  proportion  of  farm  same p e r i o d . McGee  that  of  1979;  used the source of income as  a n a l y s i s on East A s i a and Mukhopadhyay and computation  region  309).  Oshima, 1985a; McGee, 1988) criterion  i n the  the  income  proportion  (1988: 5) of  i n c r e a s e d from  citing  off-farm  12.2  per  as  cent  312 Ho a in  79  1921  t o 70.8  per  cent i n 1952 As  cent  t o 79.2  the  i n Japan, and  per cent i n 1980  above a n a l y s i s  significant  throughout  contributor to r u r a l  indicates,  Asia.  But  South and Southeast  3.3  The Growth of RNA  from  31.4  per  i n Taiwan. the growth of RNA  the  growth  income i s more r a p i d  in  The  i n 1980  of  RNA  is  as  a  i n E a s t A s i a than  Asia.  i n East A s i a  d i s c u s s i o n on  the  growth  of  RNA  i n East  Asia i s  focused on Taiwan and South Korea. Japan's e x p e r i e n c e too i s included  whenever  relevant.  The  demographic a s p e c t s of these two extent,  similar  to  those  of  socio-economic  c o u n t r i e s were, t o a l a r g e  the  densely  populated  c o u n t r i e s a t the beginning of the n i n e t e e n f i f t i e s . the  changes  remarkable Oshima  in  those  i n these  (1985b:  1)  indicators  countries  r e a l wages and growth of RNA  income  3.5  which and  decades  3.1a  and  (Japan,  Taiwan  the o v e r a l l  the  a  result  implementation  are  3.1b). and  rising  by the e a r l y 1980s.  shows the dramatic was  Asian  However,  f u l l employment, e x p e r i e n c e d  t o some extent resembles  industrialization  three  (see T a b l e s  h i g h e r r a t e s of GDP  development. T a b l e farm  over  shows t h a t East A s i a  South Korea) had reached  and  The  economic  i n c r e a s e of o f f of of  accelerated the  'Green  R e v o l u t i o n ' i n r u r a l areas. Other more important aspects of a g r i c u l t u r a l in  these  countries  were  the  diversification  transition in  farm  80  activities  along  with  successful  land  (including  irrigation  activated  reform  of  livestock  development eventually  Asia  The did  not  employment outside and  of  as  incomes  still  the  agricultural  basis  for  the  manufacturing,  and  sixties  transformation  affect  and  vegetables,  the  nineteen  agricultural  economy  agriculture.  However,  include  processing,  i n East  opportunities  towns  to  Further,  in  example,  inter-cropping  fundamental  expansion  for  peasants  by  in  (Ho, East  causing  l a n d l e s s n e s s as i n South A s i a n c o u n t r i e s .  full-time)  nearby  a  adversely  and  rural  poultry.  The  developments  i n Taiwan,  activities  food  nature  displacement The  farm  export  related  cropping,  provided  of  development.  and  facilities)  and  diversification  1982).  programme  multiple  diversification fruit,  agricultural  Oshima  farm  found  (1984:22)  during  provided  households  employment  others the  indicates,  significant  and  non-farm  i n d u s t r i e s and  employment  remained  expanded  and  Many workers  in rural for  for  Asia  commuted  slack  the  (part to  season.  agricultural  even when the  off-farm  incomes were o v e r t a k i n g the on-farm incomes i n Japan i n the nineteen-sixties, seventies.  in  Such  Taiwan  integrated  associated with a r a p i d f a l l the r u r a l The households  and  South  rural  Korea  economic  in  the  growth  was  i n the r a t e of unemployment i n  areas. increased also  income  increased  levels the  of  farm  domestic  and  non-farm  s a v i n g s and  the  81 T a b l e 3.5: The Share i n East A s i a  o f Off-Farm  Income o f Farm  Households  Period  Countries 1965  1975  1980  Japan  54  66  79  Taiwan  27(1966)  48  66  Korea(South)  16  16  20  Source: Compiled from Oshima, 1984: T a b l e s 1, 2 and 3.  T a b l e 3.6: R e l a t i v e C o n t r i b u t i o n t o f a m i l y income o f D i f f e r e n t Income Sources i n R u r a l I n d i a , 1970-81. Gross Cropped Area(ha) 0 Less than 1.0 1.0-2.5 2.5-4.5 4.5-6.5 6.5-8.5 8.5-10.5 10.5-14.5 14.5& More All  Cases  Estimated % of Families  Total Income (Rs)  41 15 21 12 5 2 2 1 1  1865 1630 2450 3640 4550 5580 6710 8480 14330  39.0 59.0 81.0 81.0 89.0 92.0 95.0 97. 0  37.7 27.0 14.0. 5.0 3.5 2. 0 1.0 0.3 0.4  62 . 3 34 . 0 27.0 14 . 0 15.5 9.0 7.0 4.7 2. 6  100 100 100 100 100 100 100 100 100  100  2650  52.0  17.0  31.0  100  Shares i n T o t a l Total Income Crops A g r i . O t h e r s *  '*' Other income source i n c l u d e s r e m i t t a n c e , penson, income, r e n t s and income from non-farm a c t i v i t i e s . Source:  ILO, 1983a:Table  4:42.  divided  82  domestic  demand  f o r non-farm  products  i n East  Asia.  The  development i n Taiwan, South Korea and Japan are examples of this  trend.  saving 1951  to  For example  i n Taiwan,  net-investment i n c r e a s e d  t o 111.1  per cent  and t h e government  i n 1971.  which  the r a t i o from  o f domestic  48.6  per  Individuals,  invested  cent  corporations  in industrial  activities  i n c l u d i n g r u r a l i n d u s t r i e s c o n t r i b u t e d towards t h i s Uneven due  spatial  to past  past,  Japan  part  of  development  as w e l l  as present  emphasized Korea  change.  i n South Korea was  partly  economic p o l i c i e s .  In t h e  development  while  in  rural  of mainly the  areas  southern  remained  largely  undeveloped. In r e c e n t decades (1960s and 1970s), government p o l i c i e s were m a i n l y focused on heavy i n d u s t r i e s and oriented  growth.  (e.g.  Saemul  urban  centres.  activities  was  Some  of  factory As  the  system) a  "rural were  result,  significantly  industrial  located  the  estates"  closer  growth  of  lower i n South Korea  export  to the non-farm compared  to other East Asian countries. In located  Japan,  the  small  i n the  small  and  towns.  medium  size  industries  We11-developed  are  transportation  w h i l e s u b - c o n t r a c t o r s t o move t h e i r goods a l s o p r o v i d e s more mobility  to  the  male  members  of  the  farm  household  who  i  commute t o t h e towns f o r p a r t - t i m e and s e a s o n a l  employment.  Women  which  have  taken  over  f o r m e r l y done by males trend  i n Japan  some  farm  activities  (Oshima, 1984).  A significant  i s the movement of s m a l l  and  medium  were recent sized  83  industries to rural  areas i n search of cheap  has c o n t r i b u t e d t o the f u r t h e r growth of These developments i n r u r a l by  rapid  urban  changes. the  oriented  of  labour  market  McGee(1987)  zone  well  as  RNA.  East A s i a were accompanied  socio-economic and  for industrial  economies  indicated  rural  and  (Kotadesa  diversified  of  demographic  that  the  urban areas  zone)  and  the  where  w e s t - c o a s t of  has the  in a  Asian  created  an  economic of  of  export  countries.  increasing  proportion  Taiwan  production  East  s i g n i f i c a n t l y h i g h e r . He i d e n t i f i e d the  This  The r u r a l areas c l o s e r t o the urban c e n t r e s were  sources  between  as  labour.  interaction "intermixed"  activities  non-farm  income  are is  such a mixed zone a l o n g  region  between  Taipei  and  Kaoshiong.  3.4 The Growth o f RNA  The  i n South and Southeast A s i a  geographical  region  of  South  and  Southeast  Asia  i n c l u d e s a l a r g e number of c o u n t r i e s w i t h v a r y i n g o f s o c i o economic review  and  other  characteristics.  i s to identify  patterns  i n the  purpose  some of the more g e n e r a l  densely  populated  where c o n d i t i o n s  are c l o s e s t  review  on  i s based  The  RNA  agricultural  t o those  characteristics  of  growth  countries  of S r i Lanka.  of  this  employment  This  changes  d e s c r i b e d i n s e c t i o n 3.1 above. The influenced  employment by  the  conditions  rapid  growth  in of  these labour  areas and  the  were poor  84  performance of the economy. agricultural  activities  seasonal work. population have  no  were  option  dominated  created  but  outside  to  seek  i s further  of  eleven  Bangladesh, Indonesia the  Table  than the h i g h e r income by  in  S r i Lanka,  findings  t h e poor  alternative  F o r example,  illustrated  (study based  or  Islam  six  relevant  to  our  groups.  Asian  ILO/ARTEP country  3.6  higher  (1984)  Thailand,  and  l a n d and  income groups have a  villages  India,  major  part-time  i n which  additional  agriculture.  p r o p o r t i o n engaged i n RNA  study  by  a situation  shows t h a t i n I n d i a the lower  This  economies, r u r a l non-  Here the l a c k of new c u l t i v a b l e  pressure  occupations  In these  in his  countries:  Pakistan  and  studies).  Some o f  discussion  a r e as  follows. First, size the  the o v e r a l l  inverse r e l a t i o n s h i p  and non-farm income i s confirmed; land s i z e  to t h i s also  a high  families  that i s , the higher  with  relatively  p r o p o r t i o n of non-farm owning  farm  the RNA income. But t h e e x c e p t i o n s  a r e t h e households  with  because  the lower  between  large  farms  l a r g e farms and  income.  have h i g h  This i s  incomes and  t h e r e f o r e a r e a b l e t o p e n e t r a t e the o r g a n i z e d s e c t o r of t h e rural  economy  and f i n d  there  (Mukhopadhyay and Lim, 1985).  of self-employment has been noted This  decline  relatively  resulting  throughout i s evident  a n a l y s i s as w e l l (Gregory,  from  prestigious  occupations  Secondly,  the d e c l i n e  i n c r e a s e d wage employment  the v i l l a g e s under Islam's i n the cross-country  study.  statistical  1979; H a r r i s and Rashid,  1984).  85  The  structure  illustrate  the  and  the  nature  of  growth RNA  of  rural  growth  in  industries  these  too  countries.  S t r u c t u r a l l y , the r u r a l non-farm a c t i v i t i e s are dominated manufacturing other b a s i c  activities activities.  manufacturing total  RNA  sector  i n the and  the  equally  important  manufacturing  be  As Table 3.7  food  processing  illustrates,  and  the  c o n s i s t s of a l a r g e p r o p o r t i o n of  Philippines in  sector  where  terms  i n the  the  of  sense  e x c e p t i o n of  service  total  the  sector  is  In  the  RNA.  d e f i n e d by  Mukhopadhyay  (1985), tobacco and beverage manufacturing appear  the most  Malaysia and  on  r e p o r t e d c o u n t r i e s w i t h the  Malaysia  and Lim  based  important  (61.7  foot  wear  activity  i n the r u r a l  per cent) and I n d i a manufacture  industries  (47.5 per c e n t ) .  i s more dominant  by  in  to in  Textile  Bangladesh  (58.2 per cent) P a k i s t a n (39.6 per cent) and the P h i l i p p i n e s (46.4  per  sectors  cent).  The  two  i n Bangladesh  continuing  high  categories  of  adherence  manufacturing  and t e x t i l e s  (81 per cent) and I n d i a proportion  manufacturing  of  employment may  be  an  where n o n - t r a d i t i o n a l  a c t i v i t i e s have shown a r a p i d i n c r e a s e .  foot total  (75 per c e n t ) . in  the  of  Asia. p a t t e r n of  manufacturing  For example,  p r o d u c t i o n i n M a l a y s i a (11 per cent of t o t a l  The  above  indication  A s i a n c o u n t r i e s show a d i f f e r e n t  industrialization  and  more than 75 per cent of t h e  t o t r a d i t i o n a l r u r a l i n d u s t r i e s i n South  Southeast rural  c a t e g o r i e s of  (food, tobacco and beverages;  wear) t o g e t h e r comprise RNA  broad  metal  manufacturing)  86 T a b l e 3.7: Share of D i f f e r e n t C a t e g o r i e s of RNA i n S e l e c t e d South and Southeast A s i a n C o u n t r i e s c i r c a 1980's. Sub- S e c t o r s  Countries Manufacturing  Constr- Trade+ Commeuction rce  Transp- S e r v i c e Other ort+ Communication-tStorage  Bangladesh  43.3  3.9  26.4  3.6  12 . 2  India  39.0  4.9  15. 0  5.4  33.1  2.6  Malaysia  21.4  7.1  19.0  7.1  38. 1  7.3  Pakistan  32.4  14.2  20.9  8.8  21.3  2.4  Philippines  28.6  8.8  17.0  9.5  32.0  4.3  Thailand  34.5  9.5  23.6  7.2  25.1  0.1  Source: Extracted Table,1.2:10.  and  machinery  account  and  for a  (observation  from  equipment  significant  based  on  Mukhopadhyay and Lim, Several  First,  size  in  they  are  employees.  terms  (13  of  1985:  per  rural  calculation  cent)  employment  Table  characteristics and  Southeast  the m a j o r i t y of the  household  of  Lim,  1.1  in  1985).  i n South  of  and  in Philippines  proportion  the  major  industrialization noted.  Mukhopadhyay  10.6  the  number  industries  of Asia  industries  employed. with  rural  may are  also  be  small i n  In  many  cases  fewer  than  five  Secondly, the m a j o r i t y of i n d u s t r i e s a r e  either  h a n d i c r a f t s or are based on  a g r o - r e s o u r c e s . With r e g a r d t o  the  industries,  agro-resource  based  the  industrial  87  activities  are  period.  a r e s u l t , employment which i s p r o v i d e d  As  industries rural  i s s e a s o n a l . The  industrial  family hired  labour.  is  (1985) computed  Islam,  productivity with  different and  productivity.  level  the  and  1985).  traditional  hired  when the  labour  compared  in  with  participation  Nepal, and  Lim,  The  1985;  rural  showed  of  that  the  rural  industries,  the  the  industries  t o the  the  low  of  is  industries  Liedholm,  1979;  level varies  among  majority show a  poor  of  low  level  of  percentage  of  declined  Pakistan,  activities  by in  labour by  0.8  about Nepal.  force  per  rural  the  other  employment i n Bangladesh showed an between 1961  and  1980.  v i l l a g e industries  industrial  workers  In  India,  Khadi  the  activities 1977/78 i n  1972/73  rural  increase  have r e g i s t e r e d  of growth i n terms of output and  between  hand,  while  example,  cent between 1960/61 and  10,000 On  in  For  of  Rural  i n some c o u n t r i e s  have i n c r e a s e d .  of  labour.  growth performance of r u r a l i n d u s t r i e s v a r i e s .  o t h e r s the  the  performance  l e v e l of s k i l l  i n d u s t r i a l a c t i v i t i e s have d e c l i n e d  1977/78  and  productivity  same time,  industries  ratio  Chuta  Though  small-scale  At  of  capital/labour  r u r a l i n d u s t r i e s i s due  and  of  i n these  of h i r e d labour i s s i g n i f i c a n t l y h i g h even i n  (Mukhopadhyay  has  post-harvesting  t r a d i t i o n a l industries.  associated  in  the  high  l a b o u r i n Bangladesh, I n d i a and  The  the  during  proportion  activities  Islam  the p r o p o r t i o n the  concentrated  and  industrial  of 2.2  per  cent  ( i n d u s t r i a l estate) a  fairly  rapid  employment w h i l e the  rate  growth  88  of  rural  industries  variations Other  between  studies  variation. pattern and  in  general  different  also  Hariyana  decline  states  (1984)  units  while  Chada  which  used  t o be  supplied  1985: 7 ) .  of  shows  a  an  regional increasing  and employment i n P u n j a b (1985)  indicates  of r u r a l industries at the national  I t has been s u g g e s t e d t h a t  significant  (Islam,  the existence  Gupta  of r u r a l i n d u s t r i a l  shown  regions  indicate  F o r example,  has  a  level.  consumer and o t h e r  by t h e r u r a l  sharp  products  industrial  sector  e a r l i e r a r e now b e i n g s u p p l i e d  e i t h e r by urban i n d u s t r i e s o r  by  industries  imports.  The  "inferior"(4) is  one  The  items  of  industries  rural  the  could  reasons  n o t compete w i t h f o r the  i n many d e v e l o p i n g  service sector  the  developing 1984).  service  has  (Gregory,  I t was s u g g e s t e d t h a t  under-employment and p o v e r t y service the  occupation(5).  Philippines, trading  forms  an i m p o r t a n t  Lanka, poor  where seek  and  free  decline  (Table grown  of  This  household  increasing  rapidly  open  recent  in  many  and R a s h i d , unemployment,  i n LDCs l e d t o a " l o w " t y p e o f  Fabella  domestic segment  3.7). I n  1979 a n d H a r r i s  (1985c)  i t i s the informal  scale  imports.  a p p e a r s t o be p r o m i n e n t i n t h e r u r a l  sector  countries  produced  countries.  economy o f S o u t h a n d S o u t h e a s t A s i a years,  which  and  government-related  sector  personnel  o f RNA.  education  indicated  as  services  In countries  i s available, service  such  that  small which  like S r i  educated  employment.  ( 1 9 7 9 ) i n h i s a n a l y s i s o f 46 d e v e l o p i n g c o u n t r i e s  in  rural Gregory  found  that  89  the  growth o f t h e s e r v i c e s e c t o r was not always a s i g n o f  p r o s p e r i t y and development. Social strongly  stratification  associated  with  (e.g.,  caste  categories) i s  the occupational  categories  in  South,Asian c o u n t r i e s . Caste d i f f e r e n c e s a r e o f t e n based on occupational system  was  (Beteille, largely  categories. largely  1965).  carried  Production, performed Hirashima  under  that  the caste  the  class  structure  out by  so c a l l e d  "lower"  caste  those  in a  relationship relaxation  belonging  Pakistani  between  has been  system d u r i n g  to  recent  rural  village  them.  noticed  of the caste  traditional  people.  and t r a n s p o r t a t i o n - r e l a t e d a c t i v i t i e s a r e higher  caste  (1978) analysed t h e non-farm o c c u p a t i o n s  orientation  rigidity  subsumed  found  S e r v i c e - o r i e n t e d non-farm a c t i v i t i e s a r e  trade by  Many have  found  However,  a  i n the r i g i d i t y  decades. system  societies  and  groups. and c a s t e a  strong  significant of the caste  I t has been found t h a t t h e has been  i n India  d i s s o l v i n g even i n  (Tharamangalam, 1980;  Gough, 1981). The economy,  right wage  relations  t o own p r o p e r t y , employment  led to  the a d o p t i o n and also  pottery  and other  t h e breakdown  ( D j u r f e d t and Lindberg,  t h e spread  of  changes  i n production  the caste  structure  1975). These changes may be seen i n  o f 'low s t a t u s ' occupations by people with  i n t h e upward  o f a monetary  skill  mobility  of  such as h a n d i c r a f t  irrespective  o f c a s t e and  'low c a s t e '  persons  into  90  h i g h e r s t a t u s occupations through e d u c a t i o n a l a t t a i n m e n t s as may  be seen i n S r i Lanka. Public  works  such  as  road  building,  repair  of  i r r i g a t i o n c a n a l s or tanks are an important source o f income for It  the r u r a l poor has  been  (irrigation, by  the  i n South  indicated roads,  that  Southeast  different  infrastructural  individual  international  and  governments  Asian  types  countries.  of  programmes  development) i n t r o d u c e d  with  the  assistance  a i d agencies p r o v i d e employment t o the  of  rural  poor i n LDCs (ILO, 1983a: 61). These programmes are p r o v i d e d during  the  off-agricultural  seasons  which  poor t o supplement t h e i r a g r i c u l t u r a l The  impact  a s p e c t of RNA  allow  the  income.  of overseas employment i s another  i n South  and  rural  Southeast A s i a .  important  For example, i t  i s e v i d e n t t h a t t h e r e i s c o n t i n u i n g o u t - m i g r a t i o n from A s i a t o the Middle East e s p e c i a l l y Pakistan  f o r example,  such  South  from the r u r a l a r e a s .  migration,  in fact,  In  eased  the  employment p r e s s u r e by t a k i n g an estimated 7 per c e n t o f the rural  labour force  migration farmers  takes  (Hewavitharana,  p l a c e elsewhere.  1987:  4).  For  example,  c r o s s the M a l a y s i a n border, u s u a l l y  Similar  out-  Indonesian  illegally,  for  employment i n non-farm a c t i v i t i e s . Finally, financed persons  export  industries -both  countries. impact  the  on  The the  processing  employ  male and  a  rural  significant  female-  income earned economy  zones  and  number  i n several  from  these life  and  foreign of  rural  Southeast  Asian  a c t i v i t i e s has  styles.  Two  an  recent  91  research issue  works  and  (McGee, 1986;  found  importance  in  established. employment  that  Wolf,  the  regions  impact  in  on  which  a  feature  investigated  labour  these  Though overseas and  i s not  1984)  zones  export  discussed  demand  this is  had  of  been  processing-related  in this  thesis,  the  impact of the income r e c e i v e d from these forms of employment i s found t o have a s i g n i f i c a n t i n f l u e n c e on the r u r a l  income  d i s t r i b u t i o n of the c o u n t r i e s under d i s c u s s i o n .  3.5 The  The  Factors Associated  growth of  RNA  w i t h RNA  Growth  i s found t o  be  associated  with  the  growth are a s s o c i a t e d w i t h  the  following factors i n Asia. First,  v a r i a t i o n s of RNA  agro-ecological  f a c t o r s . Oshima  (1984  and  t h a t the v a r i a t i o n s i n r a i n f a l l p a t t e r n s a s s o c i a t e d w i t h r e g i o n a l v a r i a t i o n of RNA to the  him,  the  length  off-farm  relatively and  and  Reddy  of  long.  farm and  in  RNA  in  in Asia.  closely  According encourages  non-farm households off-farm  activities  off-monsoonal season  combination of a g r o - e c o l o g i c a l  i n India. (1985)  the  A s i a where the  The  i n A s i a are  off-monsoonal p e r i o d  Traditionally,  i n East  variations  researchers  the  activities  these c o u n t r i e s . much h i g h e r  of  1985a) i n d i c a t e d  were  investigated  T h i s aspect West-Bengal  by  a  in are is  factors team  of  i n v e s t i g a t e d by Raghupati and  Swami,  et  al  (1985)  i n T a m i l Nadu. They found t h a t the  economic a c t i v i t i e s were  well-diversified  West-Bengal  in  resource-rich  compared  to  92  semi-arid arid  T a m i l Nadu. Further,  T a m i l Nadu p r o v i d e d  low  they i n d i c a t e d t h a t the productive  and  low  semi-  income  RNA  compared t o West-Bengal. Secondly,  the  growth  of  the  productivity  of  a g r i c u l t u r e s e c t o r i s found t o be p o s i t i v e l y a s s o c i a t e d the growth of RNA and  Chada, 1985  time,  the  "backward" and forward  studies  linkages  non-farm  involve  sector.  s e c t o r r e f e r t o the (Chuta (e.g.  and  increase  as  indicated  that  of I n d i a has  1979:  24).  I t has Ho,  1985)  importance  of  (Ho,  1985).  as  from  inputs  the  been  indirectly (Hainsworth, Binswanger, between Though  etc.)  the  rural are  growth  1982; 1984)  i n some  64) parts  r u r a l i n d u s t r i e s based  found of  Fabella, have  education  electrification, to  RNA. 1985a  found  influence A  a  infrastructural variables the  linkages  of a g r i c u l t u r a l products.  water,  institutions,  sector  (1986:  I n f r a s t r u c t u r a l development ( t r a n s p o r t a t i o n , irrigation  to  demonstrated  t h a t the  r a p i d a g r i c u l t u r a l growth  The  non-farm  farm  economy develops. Papola  l e d t o the growth of new  on the p r o c e s s i n g  the  l i n k with the output of the  rural the  linkages  linkages  Liedholm, 1979;  the  the  1984  At  farm outputs s e r v i n g  Backward  Liedholm,  Chuta and  on I n d o n e s i a ) .  emphasize  "forward" p r o d u c t i o n  with  on I n d i a ; Oshima,  1985a on East A s i a ; Kasryno, 1985  same  the  (e.g.,  the  overall transportation  and  directly  number  of  1985c;  significant and  financial  the  studies  Barnes  and  correlation  growth  facilities  and  were  the r u r a l areas of these c o u n t r i e s , the a v a i l a b l e  of poor  RNA. in  facilities  93  were very  non-farm s e c t o r  in  comparison w i t h the farm s e c t o r . For example, as B a r w e l l ,  et  al  e f f e c t i v e l y used by  (1985:  131)  reports,  more i n t e n s i v e l y by than by  the  of  RNA  and  transport  one  labour a b s o r p t i o n  non-farm s e c t o r (e.g.,  of  the  we  may  note  the  rural  i n India  Philippines  most  areas and  (1985a) i n h i s study  important  as  would  created  evident  is  an  exception  infrastructural  electrification  Mizoguchi  the  two  introduction  as  i n the  utilized  found  that  influences  in  i n the r u r a l areas of t h a t c o u n t r y .  when  the  were  10 times h i g h e r  in  i n f l u e n c e the growth of RNA. that  facilities  i n Bangladesh) . F a b e l l a  was  instances  the  modernization  Finally,  rural  transport  farm s e c t o r  8 times h i g h e r  the  (1985:  of  319)  there  are  factors  negatively  For example, i t has  been argued  a  new  eliminate in  that  the  technology  more  jobs  than  Philippines.  indicated  that  such  as  will  be  Likewise,  when  wages  for  u n s k i l l e d l a b o u r e r s rose s i g n i f i c a n t l y i n the 1960s i n South Korea  labour  parents  supply  encouraged  from r u r a l their  areas  children  lagged behind  to  attend  because  school  for  a  longer p e r i o d of time. Another f a c t o r a f f e c t i n g the growth of RNA to  the  villages  urban  centres.  In  closer  to  centres  opportunities show  for  urban  linkages  a  higher  proportion  (1985:  20-21)  shows  different  in  types of r u r a l  many A s i a n have  i n marketing and of  his  RNA  than  other  comparative  is  proximity  countries had  the  greater  employment regions.  analysis  l o c a t i o n s i n Japan t h a t  of the  and Ho four  rural  94  l o c a t i o n s which are c l o s e r t o the urban areas not a  higher  rural  proportion  of  involvement  RNA  in  only  but  importantly  the  non-farm  activities  appears  have  quality to  of be  higher. However,  the  circumstances, particularly Binswanger  i n the  between  their  superior  industry Chuta  and  and  production  the  urban  small  and  centres  areas.  this  rural  For  lead  (1979:  pottery  in of  RNA  Urban  could  decline  20)  note  with  sabotage  especially  in  employment.  shoe  medium  for  rural  easier  industries  access  to  cities to  a  leather  by  of  as  and  from " s u p e r i o r " products which were s u p p l i e d proximity  India  of  of  The  in  terms  traders  i n RNA  that  and  result  sector.  declined  Quizone  effectively  activities,  other  activities  "unfair"  areas.  to  some  example,  found  non-farm  can  might, decline  practices  rural  Leidholm  competition  and  trade  and  the  statistically  urban  of  to  rural  (1984)  growth  factor  contribute  trade  the  urban  also  may  move  towards  and  services  capital  tempt urban thus  d e p r i v i n g the r u r a l areas of employment o p p o r t u n i t i e s . Finally,  the  factor associated plans  for  r o l e of  the  i s another  w i t h the growth of RNA.  regional  development,  c o n t r o l , p r i c e m a n i p u l a t i o n and and  state  The  economic  in  rural  development  Mizoguchi  (1985)  fiscal  employment c r e a t i o n d i r e c t l y  and  s t u d i e d by a number of r e s e a r c h e r s 1985) .  s t a t e through  policies,  i n d i r e c t l y i n f l u e n c e s the growth of RNA.  state  important  has  growth  The  of  RNA  r o l e of has  the been  (Moore, 1985a; M i z o g u c h i , found  that  the  state  95  development  policies  have  made  a  significant  income d i s t r i b u t i o n i n Southeast A s i a n  impact  on  countries.  To summarize, t h e above a n a l y s i s i d e n t i f i e d two t y p e s o f RNA  growth  type. and  i n Asia.  This  type  The f i r s t  i s associated  i s the Japan-Korea-Taiwan with  r a p i d economic  i n c r e a s i n g demand f o r RNA-related labour.  e s p e c i a l l y prominent i n the South A s i a n in the in  these  countries  labour  i s associated  force population  t h e economies  and may  with  The second i s  region.  RNA  a rapid  growth  increase i n  without a c o r r e s p o n d i n g  be d e s c r i b e d  growth  as being  growth  i n a "low  l e v e l e q u i l i b r i u m " . T h i s a n a l y s i s suggests t h a t f o r most o f the  period  situation  under similar  consideration to that  of other  such as Bangladesh and I n d i a . t h i s aspect  S r i Lanka's south  has  Asian  The next chapter  i n depth with more d e t a i l e d data.  been  a  countries  will  analyse  96  Notes 1 Gross N a t i o n a l Product (GNP) i s d e f i n e d as t h e market v a l u e o f a l l f i n a l goods and s e r v i c e s produced by an economy i n one y e a r ' s time ( R u f f i n and Gregory, 1983: 301). The p e r c a p i t a GNP d e r i v e d by d i v i d i n g GNP by t h e t o t a l p o p u l a t i o n of t h a t economy. The GNP i n d i c a t o r i s one o f t h e commonly used measures o f economic standard. 2 The percentage d e c l i n e of a g r i c u l t u r a l employment indicates increasing employment a c t i v i t i e s i n t h e nona g r i c u l t u r a l sector. T h i s a l s o mean t h e d i v e r s i f i c a t i o n i n economic a c t i v i t i e s . However, t h e d e c l i n e o f a g r i c u l t u r a l employment does not n e c e s s a r i l y mean a c c e l e r a t i o n o f t h e RNA growth. I t may a l s o be an i n d i c a t i o n o f urban growth and expansion of employment t h e r e . 3 Gross Domestic Product i s d e f i n e d as t h e t o t a l v a l u e o f goods and s e r v i c e s excluding transaction with foreign c o u n t r i e s ( R u f f i n and Gregory, 1983: 301). T h i s i s a l s o a commonly used measure o f economic development. 4 " I n f e r i o r " because they a r e o f poor q u a l i t y o r because people assume t h a t l o c a l l y produced goods a r e i n f e r i o r t o imported goods. 5 A "low" s t a t u s type of o c c u p a t i o n i n d e v e l o p i n g c o u n t r i e s i n t h i s study r e f e r s mainly t o those o c c u p a t i o n s t h a t l a c k s e c u r i t y o r b r i n g a low income w i t h low p r e s t i g e . Domestic s e r v a n t s , d a i l y p a i d manual l a b o u r e r s and c e r t a i n c a t e g o r i e s of s e r v i c e occupations such as laundrymen, sweepers f a l l i n t o t h i s category.  97  CHAPTER FOUR: STRUCTURAL CHANGES IN ECONOMY AND  EMPLOYMENT  IN SRI LANKA SINCE INDEPENDENCE  Political a new  independence i n 1948 marked  c h a p t e r i n S r i Lankan h i s t o r y .  economic forty  and  years  demographic since  characteristics change.  Such  socio-ethnic  changes  of  employment  changes  with the issues r e l a t e d  the  structural  changes  and  rural  areas  resulting  We  i n the  d u r i n g t h e l a s t f o u r decades. causes  underwent occurred  and  assess  the from  attempt t o  economy We  will  and also  employment changes  the  in a distinct  This chapter  will  the  significant  t o the changes i n employment  post-independence p e r i o d .  employment  also  socio-  during  structure  environment.  the  major  occurred  The  i n employment  and p o l i t i c a l  Many noteworthy  have  independence.  the b e g i n n i n g of  in  deals during  identify  employment  identify  situation  i n the  their  i n the  economic  and  structure.  4.1 The changes i n Economy and Employment  The  performance  absorption  in a  following  section  of  country  an are  looks  at  economy  and  closely the  sectoral  labour  inter-related.  structural  The  change  in  employment i n S r i Lanka d u r i n g the post-independence p e r i o d and i l l u s t r a t e s the performance of the economy a t t h e subsectoral  level.  Employment  s t a t i s t i c s are a v a i l a b l e  up  to  98  1981.  The data  from f i e l d  4.1.1  f o r the post  1981  y e a r s have been  obtained  surveys.  Economic Change  The changes i n the S r i Lankan economy and i t s s t r u c t u r e have been the  illustrated  proportional  Domestic Product First,  using  the two  contribution  economic i n d i c a t o r s of  by  sectors  to  the  (GDP) and the annual growth r a t e s o f  the growth r a t e s of GDP  growth  rate  was  around f i v e  The average  annual  GDP  before  197 0 (Gunasekera, 1974) but d u r i n g the p e r i o d  1970-77, the growth r a t e  fell  per cent  to three  per cent  Subsequently, t h e growth r a t e reached a r e c o r d p e r cent  (People's indicate period  between Bank,  a  1977  Various  significant  and  1980  and  Years). economic  GDP.  i n d i c a t e the l e v e l of  the o v e r a l l economic performance of a c o u n t r y .  8  Gross  then  Thus change  per  year  between  per year.  l e v e l of 6 t o declined  growth during  again  patterns the  early  o f t h e post-1977 p e r i o d though the changes have not  been u n i f o r m . The GDP  growth r a t e s have s i g n i f i c a n t l y  the d i f f e r e n t s e c t o r s of the economy.  varied  between  These d i f f e r e n c e s a r e  r e f l e c t e d i n the changes of the s e c t o r a l c o n t r i b u t i o n t o the GDP  over  the  contribution  of  period. GDP  Table  for selected  4.1  shows  years.  the As  sectoral  this  table  i n d i c a t e s , s i g n i f i c a n t p r o p o r t i o n a l changes have o c c u r r e d i n the s e l e c t e d dominant s e c t o r s of the economy:  99 T a b l e 4.1; Sectoral Distribution (%) of Product (GDP) i n S r i Lanka- 1961, 1973, 1980 GDP  Major S e c t o r s 1961 A g r i c u l t u r e , F o r e s t r y , Hunting and F i s h i n g Mining and  Quarrying  40.7 0.5  Gross Domestic and 1985.  D i s t r i b u t i o n (%) 1973  1980  1985  24.3  25.0  2.5  NA  1.4  13.6  13.7  19.4  32 . 6  Manufacturing  11. 6  Construction  4.2  3.0  5.4  5.0  0.1  0.3  NA  0.6  9.0  10. 0  9.4  10.4  3.5  13.0  19.7  26.0  0.9  1.4  NA  2.0  Ownership of D w e l l i n g s  3.5  3.0  NA  1.6  P u b l i c A d m i n i s t r a t i o n and Defence  5.2  5.4  4.9  NA  12.2  13.0  13.1  N/A  E l e c t r i c i t y , Gas  and Water  T r a n s p o r t , Storage Communication  and  Wholesale and R e t a i l Banking,  Service  Trade  Insurance, Real E s t a t e  'NA' Not a v a i l a b l e Note: 1) F i g u r e s f o r Reported Years do not add-up t o 100%. P r o p o r t i o n a l l y Smaller S e c t o r s were not i n c l u d e d i n the Sources from where these i n f o r m a t i o n were taken. 2) F i g u r e s f o r 1980 are a t 1970 constant f a c t o r c o s t p r i c e . The f i g u r e s f o r 1961 and 1973 are a t 1961 c o n s t a n t f a c t o r price. 3) Wholesale and r e t a i l t r a d e percentage d i s t r i b u t i o n f o r 1961 i s v e r y low compared with t h a t of o t h e r y e a r s i n the table. T h i s i s e x p l a i n e d by the f a c t t h a t the wholesale and r e t a i l t r a d e category i n 1961 d i d not i n c l u d e a l l the subs e c t o r s t h a t were i n c l u d e d i n subsequent y e a r s . Source: The f i g u r e s f o r 1961 and 1973 are from Gunasekera, 1974:85, f i g u r e s f o r 1980 are from Gafoor and Kooyman, 1985: 497 and f i g u r e s f o r 1985 are from the Department of Census and S t a t i s t i c s , 1986d.  100  (1)  agriculture,  manufacturing  forestry,  and  (3)  agricultural-related the  proportional  sector The  has  hunting  wholesale  sector  has  contribution  shown  a  and  and  sale.  The  retail  shown a g r a d u a l to  significant  economy are more e v i d e n t  when the  economy had  introduction considered  the  GDP  decline  while  increase  (see  of  taken  "open  a different  market"  i n s e c t i o n 4.2.2  the  agricultural  before of  1970.  major  Among  the  sector,  the  trade  Table  4.1).  most  policies.  of t h i s  This  in  the  changes  are  r u r a l t r a d i n g , manufacturing and  4.1.2  the  aspect  is  chapter. see t h a t ,  they were not  adjustment  significant  sectors  d i r e c t i o n with  very  On the other hand, the post 1977  structural  in  d u r i n g the post-1977 p e r i o d  When c o n s i d e r i n g s t r u c t u r a l change we  except  significant  period i s  overall those  one  economy.  related  to  construction.  Employment Change  Employment changes d u r i n g  the  e x h i b i t an i d e n t i f i a b l e p a t t e r n . employed  increased  employment created  vary  within  over  between the  28  Employment c r e a t i o n was the  (2)  i n c r e a s i n g importance of t r a d e and manufacturing  of the  in  fishing,  previous  period  the  post-independence  The  year  Two  period  much higher  (1953-71).  t o t a l number of p e o p l e  period  sectors.  For  period  but  additions  million  between during  1953  to  jobs  were  and  1981.  1971-81 than  instance,  the  in  average  101  yearly  labour  absorption  during  1971-81 was  double t h a t of  the 1953-71 p e r i o d . Secondly, the a g r i c u l t u r a l s e c t o r remained t h e dominant s e c t o r o f employment c o n c e n t r a t i o n although significance the  total  1981  of t h i s  s e c t o r d e c l i n e d from  employed p o p u l a t i o n  (see Table  the p r o p o r t i o n a l  4.2,  52.9 p e r cent of  i n 1953 t o 45.8 p e r cent i n  Columns  1-3).  The  labour  absorbing  c a p a c i t y of t h e primary s e c t o r , however, has been d e c l i n i n g since  1963.  The primary s e c t o r which absorbed t h e l a r g e s t  p r o p o r t i o n of t h e t o t a l employment i n c r e a s e 1953-71 p e r i o d  absorbed  about  increase  during  tertiary  and  secondary  sectors  and  absorbed  about  rapidly  the  only  1971-81  (35%) d u r i n g t h e  one-tenth  period. of  At the  of t h e  the  same  economy  two-thirds  of  total time,  expanded  the  total  employment i n c r e a s e d u r i n g the r e c e n t decade (1971-81) (see T a b l e 4.2 Column 5 ) . Changes i n employment are e v i d e n t levels  as w e l l .  sector  such  quite  Two  major  at the s u b - s e c t o r a l  sub-sectors  as p l a n t a t i o n and domestic  different  pattern  of  labour  of  the  primary  a g r i c u l t u r e show a  absorption.  The  labour  a b s o r p t i o n i n p l a n t a t i o n (mainly t e a and rubber c u l t i v a t i o n ) a g r i c u l t u r e d e c l i n e d i n a b s o l u t e numbers. domestic  agriculture  absorption. employed  Within  in rice  showed  domestic  an  A t t h e same time,  increase  in  employment  a g r i c u l t u r e , the majority  cultivation.  However, r e c e n t  were  increases i n  102 T a b l e 4.2: The D i s t r i b u t i o n and Changes i n Employment by S e c t o r s , S r i Lanka f o r S e l e c t e d Years, 1953, 1971 and 1981. Major S e c t o r s  D i s t r i b u t i o n of Employed P o p u l a t i o n (%)  % of A b s o l u t e Growth  1953  1971  1981  1953-71 1971- 81  Primary Secondary Tertiary Unspecified T o t a l Employed  52.9 16.0 24.4 6.7 100.0  49.6 17.4 24.4 8.6 100.0  45.8 18.8 26.3 9.1 100.0  35.1 23.3 24.9 16.7 100.0  A g r i c u l t u r e and Livestock Agri.(Plantation) Agri.(Domestic)  100.0 NA NA  100.0 41.8 58.2  100.0 37.2 62.8  NA NA  Secondary S e c t o r M i n i n g and Q u a r r y i n g Manufacturing Elect.,Gas,Water Construction Transport,Storage, and Communication  100.0 2.7 63.2 0.7 11.7  100.0 2.0 52.7 1.5 15.9  100.0 4.5 50.7 2.1 17 . 3  100.0 -0.4 22 . 5 2.7 29.0  21.7  27.9  25.4  46.2  T e r t i a r y Sector Wholesale and R e t a i l Trade Finance and Insurance Community,Social Personal Service  100.0  100.0  100.0  100.0  100 .0  38.4 2.4  38.0 2.7  40.3 5.3  54.3  42 .9 7 .4  59.2  59. 3  54.4  45.7  49 .7  -  11 31 43 13 100  .5 .4 .5 .6 .0  100 . 0 -312 .4 +412 .4 100 .0 17 . 1 51 .7 3 .7 14 .2 13 . 3  'NA' denotes Not A v a i l a b l e '*' 1953-71 Finance and Insurance data are incorporated w i t h Wholesale and R e t a i l Trade i n the l i n e above. Source: C a l c u l a t e d from the Census of P o p u l a t i o n , 1953,1971 and 1981. Department of Census and S t a t i s t i c s , 1960, 1967b, 1976 and 1983b.  103  labour a b s o r p t i o n vegetable  and  While  of  s p i c e growing.  the  s e c t o r was  i n domestic a g r i c u l t u r e are i n the area  expansion  of  employment  in  the  tertiary  confined to selected occupational categories,  the  employment change i n the secondary s e c t o r showed a d i f f e r e n t p a t t e r n . The 50 per  manufacturing s e c t o r which comprised more than  cent of the t o t a l employment i n the secondary  declined  i n proportion  between 1953-81 though the  sector  absolute  number i n c r e a s e d . To  understand  important the  differences  in  As  urban  areas  in  structure. labour  change  in  employment,  areas  during  has  the  study  of  the  quarrying  4.5,  period. has  In  been  and  rural  labour  higher  absorption  than  a d d i t i o n , the  been much h i g h e r  economy  have  urban  the  except  in  i t is  sex changes i n  there  between  relatively  i n urban areas  sub-sectors  mining and  from Table been  and  Spatially,  absorption  i s evident  employment the  total  t o i n v e s t i g a t e the s p a t i a l , age  employment  areas.  the  in  rural  growth  of  i n most  of  agriculture  and  as the a v a i l a b l e i n f o r m a t i o n  indicates. The during  emerging the  patterns  of  post-independence  sectoral  rapid  employment expansion i n domestic a g r i c u l t u r a l  sector  during  the  of  trade-related  and  secondly,  activities  in  are  absorption  first,  early period  period  labour  concentration recent  labour  decades.  in The  manufacturing s e c t o r , however, shows slow employment growth.  104  On  the  whole,  the  employment  structure  s i g n i f i c a n t l y d u r i n g the p e r i o d under  d i d not  change  study.  T a b l e 4.3: Absolute Change i n Employment i n R u r a l and Urban Areas by I n d u s t r y D i v i s i o n , 1971-1981. Industry D i v i s i o n  Total  Urban  Rural  Change Share Change Share Change Share (Total) (%) (Total) (%) ( T o t a l ) (%) Agr i . H u n t i n g and Fishing  46576  11. 2  -10209  9 .2  56785  19. 2  and Q u a r r y i n g 21235  5. 3  1280  1. 2  19955  6. 8  52176  12. 9  41797  37. 6  10379  3. 5  6240  1. 5  2326  2. 1  3914  1. 3  Construction  31063  7. 7  9573  8. 6  21490  7. 3  Trade Restaurants Hotels  91331  22. 5  50109  45. 1  41222  14. 0  Transport,Storage Communication  16858  4. 2  -1755  -1. 6  18613  6. 3  Finance, Rent and Real Estate  32487  8. 0  17777  16. 0  14710  5. 0  Service  52658  13. 0  22051  19. 9  30607  10. 4  Not  55402  13. 7  -21884 -19. 7  77286  26. 2  406026 100. 0  111065 100. 0  Mining  Manufacturing E l e c t . Gas Water  Stated  Total  294961 100. 0  Source: C a l c u l a t e d from P o p u l a t i o n Censuses 1953, 1971 and 1981. Department o f Census and S t a t i s t i c s , 1976 and 1983b.  105  4.2  F a c t o r s of Employment Change  The  patterns  of  i n f l u e n c e d mainly changes  in  the  labour  by  absorption  the demand and  employment  in  supply  structure  a of  were  country  are  labour.  The  influenced  by  a c t u a l and p o t e n t i a l c a p a c i t y of labour a b s o r p t i o n among the v a r i o u s s e c t o r s i n an economy. capacity  are  dependent  production,  techniques  inputs  the  and  addition,  a  cultural  upon  the  of  adopted  other  f a c t o r s also play a role  The  by  the  population,  availability government. political  i n the p r o c e s s  Lanka  first  two  between 1953 annual  experienced decades  and  1971  people  periods  (1953-71).  Within  In and  labour  growth  during  later.  rapid  since  population  independence.  (Table 4.4).  additions to  255,000  compared  of  of  The  annual growth r a t e s of p o p u l a t i o n were more than  of  and  Population Factor  Sri the  of  socio-economic,  a b s o r p t i o n as w i l l be d i s c u s s e d  4.2.1  growth  used, labour s k i l l s ,  policies  number  Such s e c t o r a l p o t e n t i a l  with this  per  the 18-year  the  annum  total during  This period  period,  growth o c c u r r e d between 1953  2 per  cent  In other words, the  size  population the  the  and  1953 highest  1963.  was  above  i n c r e a s e was before  average  more  than  inter-censal  much h i g h e r  when  and  1971.  after  annual  average  As a r e s u l t , the  age  106 T a b l e 4.4: Growth Rates of P o p u l a t i o n and Labour Force Changes i n A c t i v i t y Rates, Census Years A f t e r 1953. Annual Average Growth Rate Total Population  Census Year  Population Aged 15-59  and  Activity Rate*  Labour Force 15-19  1953  Total Male Female  2.8 2.7 2.9  2.2 2.1 2.3  2 .1 1.7 3.7  60.1 87.9 27.8  1963  Total Male Female  2.7 2.5 2.5  2.1 1.8 2.4  1.5 1.7 0.4  66.3 85.2 30.7  1971  Total Male Female  2.2 2.1 2.4  4.2 4.1 4.4  4.4 3.6 6.9  59.9 85. 0 33.2  1981  Total Male Female  1.7 1.6 1.8  2.5 2.3 2.7  1.3 1.4 1.1  54.4 79.0 29.1  A c t i v i t y Rate i s Defined as the P r o p o r t i o n of Labour Force i n t h e T o t a l p o p u l a t i o n . Source: F i g u r e s f o r 1953 and 1963 are from ESCAP,1976:19 and f i g u r e s f o r 1971 and 1981 are from Department o f Census and Statistics,1986c.  T a b l e 4.5: Changes i n Labour Force, Employed and Unemployed P o p u l a t i o n , 1953-81 Change i n Employment Labour Force  Inter-Census Period 1953-63  1963-71  Unemployed  Total  (30.0) 458358  (14.4) 195973  (59.5) NA  Urban  NA  NA  Rural  NA  149946 (32.7) 46027  (30.0) 1036432 (52.2) 349495 (24.7) 686937  (14.4) 459553 (28.2) 172005 (11.1) 287548  (59.5) 313000 (59.5) 177490 (198.0) 399389  (11.8) 528434 (8.5) 86611 12.7 441823  (12.9) 470449 (14.3) 111960 (12.5) 358489  (6.9) 57985 (-10.6) -25349 (19.9) 83334  Total Urban Rural  1971-81  Employed  Total Urban Rural  NA  'NA' Denotes Not A v a i l a b l e F i g u r e s i n parentheses i n d i c a t e percentage change between census y e a r s . The d e f i n i t i o n o f labour f o r c e d i f f e r s between census y e a r s (See Appendix 1) Source: C a l c u l a t e d from Census o f P o p u l a t i o n , 1953, 1963, 1971 and 1981. Department of Census and S t a t i s t i c s , 1976 and 1983b.  108  s t r u c t u r e of the p o p u l a t i o n of  of S r i Lanka changed  from  1953. Many  During  factors  the  achieved caused  led  thirties  to  and  the  rapid  forties,  population  significant  high  measures  death 1950;  rates Gray,  improved  people,  in  results  pre-independent  1974).  the  especially  Subsequently,  health  after  Sri  and  living  independence  of  were  deaths  which  independence. About 50,  achieved  in  crude  had  begun  55 and  death  to  decline  of  decline  infant mortality  i n crude death  changed from 30 deaths per i n 1946  and  a f t e r 1953 The  11  i n 1953.  The  (ESCAP, 1976  birth  1000  and Peebles,  absence  of  population  birth  was  the  to  major  as  t o 1953  S r i Lanka, factor  size  example, to  of the  29  even  the  thousand  significant  1970.  natural  In  increase  rapid  a major impact on the age  the  The  a  after  p o p u l a t i o n growth had on  1971.  in  and  and  and  1953.  i n 1933  25-30 per  i n c r e a s e between 1953  population  for  and  1984).  r a t e began o n l y  in-migration  and  d e c l i n i n g trend continued  r a t e remained as h i g h  i n the  rates,  i n population  p o p u l a t i o n d u r i n g the p e r i o d 1948 reduction  well  reductions  maternal m o r t a l i t y r a t e s r e s p e c t i v e l y between 1933 pattern  and  reduction  66 per cent  rates,  of of  (Selvaratnam  in  number  Lanka  conditions  which c o n t r i b u t e d t o a s i g n i f i c a n t  before  were  a number  Meegama, 1971) the  growth.  i n the c o n t r o l of m a l a r i a and other epidemics which  (Cullumbine,  The  that  the of  population  post-independence r a p i d  labour  and unemployment i n the p e r i o d a f t e r  1971.  s t r u c t u r e of  force,  employment  109  The age s t r u c t u r e of the S r i Lankan p o p u l a t i o n began t o change  significantly  after  percentage  of  the t o t a l  (dependant  population)  independence.  population  which was  below  about  For example,  the  14  age  years  37 per cent  time of independence i n c r e a s e d t o 39.7 per cent 41.5  per cent  i n 1963.  c o n t r i b u t i o n of t h i s 35.2  per  cent  Since  i n 1981  due  of Census and S t a t i s t i c s , The age group 15-29 different  to  relatively  patterns  and  cent  1981  in  in  relevant  to  significant half  the our  the  younger  recent  post-  of  discussion.  increase  i n the  p e r cent i n  1976  1976-1986).  age  years.  structure  groups  The  was  period  (see Diagram 4.1).  and  increased  demographic  resulted  changes  i n two  population  which  The  first  change  number  of  dependants  t h e i n c r e a s e of the labour  From the a v a i l a b l e s t a t i s t i c a l  the  T h i s meant  has  o f the post-independence p e r i o d and  change  in  the  28.4  (ESCAP,  t h e post-independence p e r i o d  changes  first  in  i n 1963,  of Census and S t a t i s t i c s ,  considerably during  per  from  during  The p r o p o r t i o n of t h i s age group i n t h e  1971  labour  population  (young labour f o r c e age p o p u l a t i o n )  25 per cent  that  slow  reached  1976 and 1986c).  p o p u l a t i o n was  Department  and  (ESCAP, 1976 and the Department  total  29.6  i n 1953  1971, however, t h e percentage  growth  independent p e r i o d .  a t the  age group began t o d e c l i n e and  growth between 1971 and 1981  exhibited  of  major  are  very  was  the  i n the  t h e second  force i n the  latter  i n f o r m a t i o n , t h e growth  t h e p o p u l a t i o n and labour f o r c e v a r i e d d u r i n g t h e p o s t -  Diagram 4.1:  The S t r u c t u r a l Changes i n P o p u l a t i o n 1950-1980  THE STRUCTURAL CHANGES IN POPULATION 1950 - 80  Source: 13ased on I n f o r m a t i o n from P o p u l a t i o n Censuses,  1953  and  1981.  I  Ill  independence discussion divided  period(1)  i n this  into  the  population  4.5).  F o r t h e purpose o f  s e c t i o n , t h e post-independence p e r i o d i s  two p a r t s ,  the p e r i o d a f t e r  (Table  1963.  grew  i ) the p e r i o d b e f o r e During  the f i r s t  by 3.4 p e r cent  1963 and i i )  period  (1946-53),  p e r annum  while the  l a b o u r f o r c e grew by 1.9 p e r cent. During  t h e second p e r i o d  (1953-81) t h e p o p u l a t i o n growth was 2.2 p e r cent while  t h e labour  force  grew  a t 2.5 p e r cent  p e r annum p e r annum.  Such l a b o u r f o r c e growth would appear much h i g h e r d u r i n g t h e second p e r i o d i f t h e r e f i n e d work f o r c e age group taken  into  labour  account  (Table  4.4). The r a p i d  15-59  growth  in  is  the  f o r c e d u r i n g t h e second p e r i o d was due t o t h e e n t r y  of t h e younger age groups i n t o t h e working p o p u l a t i o n . The  growth o f t h e labour  f o r c e i s determined n o t o n l y  by t h e changes i n t h e age s t r u c t u r e but a l s o by a number o f socio-economic labour  force  developing  and c u l t u r a l  factors.  participation  countries.  F o r example,  i s usually  S r i Lanka  higher  male  i n many  i s no e x c e p t i o n  to this  p a t t e r n . However, i n r e c e n t years, t h e o v e r a l l female l a b o u r force  participation  has been  rapidly  increasing  in  Sri  Lanka. I t i s t h e younger women who p a r t i c i p a t e more i n t h e workforce. female and  Apart  labour  from t h e demographic changes,  f o r c e a r e due t o t h e changing  changes i n  role  o f women  i n c r e a s i n g female s c h o o l i n g i n r e c e n t years i n S r i Lanka  (Isenman,  1980;  differences participation  Jones  between  and urban  a r e not very  Selvaratnam,  1974) .  and  labour  obvious  rural though  a  The force  significant  112  variation age of  i n work f o r c e p a r t i c i p a t i o n  groups p a r t i c u l a r l y rural  female  Finally, corresponded during 4.5  i n work  i s considered  in  growth the  of  the  growth  of  labour  force  employment  period  increasing particularly  employed provide  to  has  open  been  (Table  has  never  opportunities 4.5).  during  the  last  unemployment,  the  number  i n c r e a s i n g although  such i n f o r m a t i o n  growth  of  the  the  (see s e c t i o n 4.3.6  f o r more d e t a i l s ) . T h i s i n c r e a s e was the  a  chapter.  post-independence  addition  the role  As  Table  i n d i c a t e s , the t o t a l number of unemployed p o p u l a t i o n  been In  the with  the  among women i n S r i Lanka. The  participation  l a t e r s e c t i o n of t h i s  i s evident across  labour  force  due  and  two  has  decades. of  census  under-  does  not  of t h i s  chapter  t o the gap  between  the  new  employment  created during t h i s period. The  relative  employment has growth  of  employment disparity  gap  the  v a r i e d between urban  the  labour  force  c r e a t i o n was  in  rural  force areas.  relatively the  rural  Such  during  areas  urban  (Table 4.5.).  areas  when  compared  urban  but  areas c o u l d be seen i n d e c r e a s i n g unemployment t r e n d s the  c r e a t i o n between  The  higher areas.  and  rural  in  employment  lower  was  and  labour  and  1971-81  in  between  with  the  rural  113  4.2.2  Government P o l i c i e s , Employment C r e a t i o n and  Economic  Performance During the Post-Independence P e r i o d  Employment c r e a t i o n d u r i n g the post-independence p e r i o d was  greatly  policies.  Government  political section  influenced  and  at  government's  was  foreign  the  impact  employment c r e a t i o n and post-independence  the  policy  external  looks  by  influenced exchange  The  During  This in  the employment s i t u a t i o n d u r i n g  the  with  P e r i o d Before  this  internal  factors.  government  special  emphasis  v a r i a t i o n s between the p e r i o d s b e f o r e and  4.2.2.1.  by  policy  period  of  economic  on  the  after  1970.  five  governments  1970  period  (1948-70),  ( e x c l u d i n g s h o r t - l i v e d i n t e r i m governments) formed m a i n l y two  major  p a r t i e s , the United  S r i Lanka Freedom P a r t y power base was and  the  SLFP's Sinhala  mainly  medium power  and  was  educated  National Party  (SLFP) r u l e d the country. urban,  large  based  English-educated,  entrepreneur  largely  period.  performance of the Until  on  class,  the  rural,  people. Both p a r t i e s and  w e l l supported by the S i n h a l e s e The  1956,  (UNP)  the  and The  by the  UNP's  land-owners while  the  landless,  governments were  population.  economy was  uneven d u r i n g  this  economy performed r e a s o n a b l y  well  sustained  by  the  accumulated  sterling  time. The  GDP  was  growing a t an  reserves  annual r a t e of  from 5 per  war cent  114  and  the  the  country  1950-51  Korean  Between 1956 and  and  rapidly  problems  experienced  war(2)  1960,  period  import  volume  1974:120).  During  f o r e i g n exchange c r i s i s deepened. adverse trade  trade  balance  balance  declined  to  index  86  per  (Gunasekera,  1974).  a moderate downturn of e x p o r t p r i c e s  increasing  (Snodgrass,  a f o r e i g n exchange boom d u r i n g  cent  stood in  1960  economic  and  1964,  the  S r i Lanka e x p e r i e n c e d  which worsened which  caused  over  at  1964  100  the per  years. cent  (Ponnambalam,  an The  in  1958  1980: T a b l e  3.2). However the economy p i c k e d up again d u r i n g the 1965-70 period. 6.1 66  The  overall  growth of GDP  during t h i s  per cent per annum as a g a i n s t 3.7 (Corea,  was  policy  the  greater  per cent d u r i n g  had  development  priority  and  an  impact  on  of  domestic  within t h i s  employment  which  large-scale  ruled  from  agricultural  establishment where  1960-  agriculture sector  changes. was  of  abundant  1948  1952  development  agricultural land  to  resources  were  The  UNP  concentrated  schemes  settlements  given  rice-cultivation  g i v e n major a t t e n t i o n i n development p o l i c i e s .  government  was  1971:19).  State First,  period  i n the  available  on  including dry for  areas rice  cultivation. According to Karunatilake 1951, areas.  nearly  5580  families  For t h i s purpose,  allocated  for  (Wickramasekara,  major  were  118,  438  (1971:20) between 1947 settled  the  dry  zone  a c r e s of crown l a n d were  colonization  1985:Table 8.5).  in  and  The  schemes largest  in  1953  multi-purpose  115  project,  the  Galoya  scheme,  According  t o Ponnambalam  was  inaugurated  (1980:22)  t h e amount  i n 1949. invested i n  the  Galoya scheme was Rs 910 m i l l i o n which was e q u i v a l e n t t o  the  total  average annual government  In  addition,  in  t h e wet zone.  revenue  i n t h e 1950s.  a number of development p l a n s were implemented For example,  through v i l l a g e  expansion  schemes, about 309,000 acres o f crown land were a l l o c a t e d t o the  l a n d l e s s , by 1953 (Wickramasekara, 1985: T a b l e 8.5). The  agricultural  (1956-65) previous  differed,  development to  some  regime. The SLFP  agriculture  development  colonization  on a s m a l l  This  government  (1956)  was  structure  and made  scale  of t h e l a n d l e s s  responsible  cultivation returned  SLFP  of the  t o domestic  on s m a l l - h o l d i n g s  stage  highlands t o  (Swan,  1983:137).  f o r The Paddy  Lands A c t  f o r securing  a great  important  the  those  committed  i n t h e wet-zone  impact  (Robinson, 1975 and Moore,  Another  of  areas. The SLFP a l s o sponsored  which made p r o v i s i o n  cultivators  from  but c o n c e n t r a t e d  i n t h e wet-zone  t h e problems  extent,  was a l s o  particularly  alleviate  policies  tenure  f o r paddy  on t h e r u r a l  social  1985a).  i n t h e development  of r i c e -  was i n t r o d u c e d by t h e new UNP government  which  t o power i n 1965. I t sponsored a p l a n w i t h  a new  approach c a l l e d The A g r i c u l t u r a l Development P r o p o s a l s 196670. based on i n t e n s i f i e d a g r i c u l t u r e b u i l t round a 'package' of  inputs,  included  a l l designed 1)  fertilizers,  t o move  high-yielding  seed  i n unison. varieties,  The package 2)  chemical  3) t r a c t o r and other a g r i c u l t u r a l machinery, 4)  116  use  of  6)  agro-chemicals,  5)  increased  extension  services  a g r i c u l t u r e c r e d i t s (Ponnambalam, 1980:62). Increased  development  state  has  investment  contributed  to  in a  domestic  agricultural  significant  growth i n t h i s s e c t o r e s p e c i a l l y between 1953 has  It  been shown t h a t the primary s e c t o r absorbed 35 per  cent  Table  and  t o t a l employment i n c r e a s e between 1953 4.2).  I f we  3 digital  cultivation within in  employment 1963.  of the  the  and  the  1971  (see  look at labour a b s o r p t i o n more c l o s e l y a t  group  level  (Table  which  absorbed  a  primary  sector.  The  agriculture  and  (particularly  4.6  Part  large  A),  i t was  proportion  of  female employment  rice-cultivation)  rice labour  creation  was  1/3  of  the t o t a l i n c r e a s e i n a g r i c u l t u r e employment. Apart of the  from  welfare  a g r i c u l t u r e development p o l i c i e s ,  (anti-poverty)  post-independence  listed  such w e l f a r e  resettlement integrated  period.  policies  schemes, rural  policies  tenancy  development  were  a  number  implemented  during  Wickramasekara as  1)  land  reform  and  (1985:250)  policies, land  programmes;  3)  peasant  reform;  target-group  o r i e n t e d programme (food stamps scheme, supplemental programmes,  public  programmes  (food  assistance), subsidies,  4)  general  education  2)  feeding  minimum  fees  and  needs health  policies). Of had on was  a the  these w e l f a r e  programmes,  f a r - r e a c h i n g impact on employment  introduced  i n 1945.  situation.  education  s o c i e t y and First,  and  health  in particular free  Since independence t h e r e had  education been a  T a b l e 4.6: Ten Industry D i v i s i o n s i n Ranking Order ( 3 D i g i t a l Group) Which Show Increase i n T o t a l Employment, 1953-71 and 1971-81.  a) P e r i o d 1953-71  Employment  Change  Total Increase  Rural Increase  A g r i . + L i v e s t o c k Produc. Education Service Construction Pub. Admi. and Defence Land T r a n s p o r t Fishing Wholesale Trade Restaurants, Cafes M e d i c a l , Dental Manu. o f Wood  188877 68281 46875 46543 40436 39340 27600 25215 22355 14944  154412 39446 32160 25313 14287 29988 15821 8401 6559 8400  46.1 11.8 9.6 7.6 4.3 9.0 4.7 2.5 2.0 2.4  Total  520466  334787  100.0  81113 51376 44572 31260 30407 19245 16974 16898 14863 14339  49026 40769 33902 12270 20809 16034 9067 5727 15754 11516  22 .8 19. 0 15. 8 5. 7 9.7 7. 5 4.2 2 .7 7. 3 5. 3  321047  214874  100. 0  Group No.  Industry  011/012 831 400 810 611 030 510 531 833 231  Division  % Share (Rural)  b) P e r i o d 1971-81 520 810 831 222 400 030 710 532 611 211  R e t a i l Trade Pub. Admi. and Defence Education S e r v i c e Manu. o f Wearing A p p a r e l . Construction Fishing Financial Institution H o t e l s , Rooming Houses.. Land T r a n s p o r t Food Manufacturing Total  Source: C a l c u l a t e d from Census o f P o p u l a t i o n , 1953, 1971 and 1981. Department o f Census and S t a t i s t i c s , 1960, 1967b, 1976 and 1983b.  118  rapid  expansion  Government fold  educational  expenditure  during  1950/51  of  the  to  on  education  f i r s t two  5120  facilities  at  increased  decades from Rs.  million  in  1967/70.  about  the number of teachers  100,000  result, remote  School  m i l l i o n t o 2.679  i n c r e a s e d from 39,200 t o  of  educational  facilities  were a v a i l a b l e even  S r i Lanka.  Ceylon,  Health  1971:109).  facilities  As  in  were  and  7 per  health-related The an  also  second  of t o t a l  government e x p e n d i t u r e  in  the  According most  number  on  of  state  employees  the  in  this  t o the p o p u l a t i o n census i n f o r m a t i o n ,  important  Within  alone  was  facilities.  sector  i n the  labour  s e r v i c e s e c t o r , the  absorbed 27 per cent  the  absorption  the s e r v i c e s e c t o r d u r i n g t h e , p e r i o d under review 4.6).  the  expansion of the s e r v i c e s e c t o r by the s t a t e l e d t o  increase  sector.  cent  a the  improved. During t h i s p e r i o d an average of 2 per cent of GDP  in  enrolment  Government  of  five-  million  (The  areas  levels.  nearly  1057  i n c r e a s e d d u r i n g the same p e r i o d from 1.336 m i l l i o n and  all  (see  educational  was Table  services  (or 68,281 persons) of the  total  employment i n c r e a s e . In s p i t e the  of the World Bank recommendation  establishment  of  small-scale  ( K a r u n a t i l a k e , 1971:32), UNP before  1955  did  manufacturing government  in  not  sector 1956  of  entrepreneurs  governments which were i n power  attempt in  individual  i n favor  Sri  proposed  to  Lanka. a  establish Though  comprehensive  a the  sound SLFP  economic  development programme i n which the r o l e of the m a n u f a c t u r i n g  119  s e c t o r was  stressed,  such a p l a n  never m a t e r i a l i z e d due  the p o l i t i c a l problems a t the time. However, a f t e r 1956, government  implemented  industrialization assumed  the  chief  (Balakrisnan, increase 1979).  in  in  The  which  role  1977) state  a the  in  foreign  led  development i n t h i s regard. 1970 10  thus c o n t r i b u t e d  percent) t o the  to  industrial  exchange  The  (Table  sector  of itself  heavy  industries  the  rapid  employment  prevented  (Laksman,  any  further  manufacturing s e c t o r  before  small proportion  4.1)  the  up  corporations  crisis  a relatively  GDP  policy  government  setting  which owned  deliberate  to  and  presumably  employment t o a l e s s e r degree compared with o t h e r  (around provided  s e c t o r s of  the economy. The confirm  patterns t h a t the  policies  were  growth.  The  development proportion  of  labour  significant  state's  of  in  interest  welfare  has  employment  service-related  during  1953-71 thus  impact of the post-independence government  very  and  absorption  in  overall  domestic  contributed  growth  activities  the  in  during  to  paddy  the  employment agricultural  a  significant  cultivation  first  period  and  under  review. It  i s important  to  assess  the  q u a l i t a t i v e performance  of employment-creation d u r i n g the p e r i o d under review.  The  annual growth of r e a l value  added per worker i n a g r i c u l t u r e  a c t i v i t i e s was  between 1963  much  less  than  1.3  per  the  service a c t i v i t i e s  cent  rate  for  industry,  (Muthubanda, 1975:  and  1973.  This  construction  is and  Table 2 ) . Furthermore,  120  within  t h e area  of a g r i c u l t u r a l  activities  the r e a l  value  added p e r worker i n r i c e - c u l t i v a t i o n was Rs 73 i n 1971 w h i l e f o r o t h e r a g r i c u l t u r a l a c t i v i t i e s t h e r a t e s were much h i g h e r (e.g.,  coconut  (Muthubanda,  Rs  1137, rubber  1975:  Table  Rs  3) .  204  Rice  and  t e a Rs  135)  cultivation-related  workers were the lowest p a i d because of low p r i c e s p a i d f o r paddy  and  the  large  inflow  of  labour  into  the  rice  a g r i c u l t u r a l sector. There were  s e v e r a l other  employment  creation  creation  was  cultivators. chillies from the  during t h i s  biassed  chena  government p o l i c i e s .  commercial second  Sinhalese farmers  criticism  period.  towards  The h i g h l a n d  and o t h e r  rural  criticisms  crop crops)  o f t h e nature o f First,  employment  rice-cultivation  cultivators  (e.g.,  (Ponnambalam,  onion,  r e c e i v e d no encouragement  Such e x c l u s i o n s e r i o u s l y  cultivators  and  and t h e J a f f n a 1980; Moore,  was t h a t the w e l f a r e  affected Peninsula  1985a).  policies  The  which  v i g o r o u s l y promoted d u r i n g t h i s p e r i o d d i d not b e n e f i t  were those  who were r e a l l y poor (Isenman, 1980; Ponnambalam 1980; Swan, 1983;  Moore,  1981b;  Richards  and  Gooneratne,  1980).  I n s t e a d , t h e w e l f a r e o f middle and lower middle c l a s s was t h e aim o f these p o l i c i e s  people  (Swan, 1983).  On t h e whole, t h e p e r i o d under review was c h a r a c t e r i z e d by r a p i d l y i n c r e a s i n g unemployment e s p e c i a l l y among youth,  increasing  landlessness  i n c r e a s i n g socio-economic  among  the r u r a l  tension i n the country.  educated poor  and  121  4.2.2.2 The  P e r i o d 1970-81  Unemployment because  of  slow  structural  rose  r a p i d l y during  economic  problems.  growth  Increase  the  nineteen  due  to  i n the  a  statistics,  340,000 persons  open  (10.5  unemployment  % of the  labour  number  unemployment  reached i t s peak l e v e l i n the e a r l y s e v e n t i e s . available  sixties of rate  According  increased  force)  to  from  i n 1959/60 t o  about 546,000 persons (13.9% of the labour f o r c e ) by 1969/70 (Kearney, young  1975:  735).  (15-25) and  had  The  majority  first  period  other  (1970-77) begins  were the Party the  p a r t i e s which Lanka  (CP). left.  The Its  were  i n the  Sama Samaja Party policies five  year  plan  The  contributed form 1971 and  i n the  to  serious youth  cultural  coalition  the  in  economic  Communist  1971  i n s u r r e c t i o n of  1971.  problems  manifested The  youth  Wilson,  1982  towards was  i n the  in  a  violent  uprising in social  and Obeyesekere, 1974)  political  (e.g.,  and  Keerawella  generally  agreed t h a t the main reason  f o r the  an  eventually  from a number of p e r s p e c t i v e s ,  (e.g., Kearney, 1975  (SLFP).  governments  economic s i t u a t i o n  that  a  coalition  Bandaranaike  presented  unrest  has been analysed  the  government leaned  attempt t o f a c e up t o t h e c r i t i c a l country.  with  (LSSP) and  of t h i s  T h i s was  seventies.  government under the l e a d e r s h i p of Mrs. Two  unemployed were  r e c e i v e d some e d u c a t i o n .  d i f f i c u l t c h a l l e n g e i n the nineteen The  of the  and  1980). I t i s uprising  the r a p i d i n c r e a s e i n the number of unemployed youth.  was  122  The  1971  u p r i s i n g compelled  the l e f t - o r i e n t e d  coalition  government t o implement q u i c k l y some r a d i c a l reforms  i n the  economic s t r u c t u r e i n order t o ease i n c r e a s i n g unemployment and  l a n d l e s s n e s s . The  This  law  put  individuals  and  government was located and  a  ceiling  i n the  o p e r a t i v e s and  wet  these  lands  were  the  By  implementing  and  ownership  of t h e s e .  of  land  this  of  (50%)  the  intermediate  f o r the  by  law,  to  (45%) (Swan,  acquired  climatic  b e n e f i t of  given  collectives  corporations  proportion  on  one  the  a b l e t o a c q u i r e over 200,000 h e c t a r e s of l a n d  redistribute  and  Land Reform Lav was  others.  mainly  alienated  1972  the  poor.  individuals  and  1983:143).  in  co-  agencies  The  remained  The  (5%),  t o government  lands  zones  largest  government  hands. The  government  was  also  able  to  use  these  lands  youth s e t t l e m e n t schemes p a r t i c u l a r l y f o r educated the end been  of 1974,  about 51 such youth  e s t a b l i s h e d and  employment  about  (Sanderatne,  inaugurated areas the  the  i n 1976  4500 youths  1977:  a g r i c u l t u r e development and  293).  development  schemes  was  were In  youth.  At  schemes had given  the  direct  process  of  employment, the government a l s o  d i v e r s i o n of  at P o l g o l l a .  settlement  for  Mahaweli  The  water  colonization  encouraged.  to of  The  dry  zone  l a n d under  government's  F i v e Year P l a n 1972-76 proposed a p l a n i n which a t o t a l  of  269,100 a c r e s  irrigation  in  Table  In  the  dry  addition,  zone  of  new  areas  greater  lands were t o be (People's  emphasis  was  Bank, given  given 1986: to  the  3) .  industrial  123  sector  to  government  increase  employment  hired  many  as  of  absorption.  the  Finally,  unemployed  the  population  as  p o s s i b l e i n t o i t s cadres. While the  coalition  deteriorating  government was  employment  problem,  several  internal  f a c t o r s were making i t harder  Herring  (1987:327)  growth, debts  austerity  and  high  has  summarized  budgets,  He  ease  and  government.  factors  as  i n t e r n a l and also  the  external  f o r the  those  mounting  unemployment.  t r y i n g to  argued  slow  external that  such  economy  came  economic c r i s e s were l a r g e l y e x t e r n a l i n o r i g i n . The from  the  prices cent  first  real  oil-price  ( i n the  shock hike  to  in  the  the  S r i Lankan  i n t e r n a t i o n a l market.  i n t e r n a t i o n a l market)  between 1973  and  1974  increased  by  Oil  500  per  (Fernando, 1986). S r i Lanka as  a  dependent c o u n t r y f o r i t s o i l on the world market p a i d  high  prices  Many  for  researchers  oil have  economy s u f f e r e d end  of  World  increased the  and  all  oil-related  shown  that  the  its first  War  II  unemployment and  developed  countries  increase  economy  had  which  materials,  trade  disastrous  dependent  spare  1985b:1088). As terms of  a  a  parts result,  between 1974  down  pushed-up the  leading  to  on and  an  impact  cost upward  on  imports  of  capital  1975  since  the  production of  and  living  in  movement  of  (Fernando, 1986:  S r i Lanka and  capitalist  recession  "brought  export p r i c e s " of those c o u n t r i e s an  international  generalized  which  products.  17).  Such  S r i Lanka s 1  essential goods  experienced (Herring,  raw  (Moore, the  worst  1987:  Table  124  2) .  S r i Lanka's f o r e i g n debt doubled  and  the debt s e r v i c e r a t i o reached  per cent  (Fernando, 1986:  Internally, worst  drought  during  1975  Maha season  was  responsible  failure  for  cent  yields  per  between 1971  1975/75  1975/76  particularly  of  than  production, the  The  and  during  the  imposed  local  situation to  and  0.7  per  cent  Bank, 1978:  per  Table  annum  5 ) . As  a  economy  was  the  even  Table  worse  lowest  was  2.9  5 ) . The  during  since between  growth  this  of  period  4.2).  by  attempted  adopting  reduction  on in  production  i n the country  to  reduce  the  increasing  a number of a u s t e r i t y  period.  restrictions  food  food  and  Glewwe, 1986:  difficult  significant  crop  affected  annual growth r a t e of GDP  government  economic c r i s i s  the  i n t e r n a l c o n s t r a i n t s , the r a t e of  a g r i c u l t u r e was  (Table 4.1  severely  of  which  area under r i c e - c u l t i v a t i o n  1.4  Lankan  ( B h a l l a and  domestic  cent  in  2.1  (People's  The  per  drought  the  by  and  Sri  The  f o r example, decreased  by  the  90  period  declined  independence. 1970-77  and  Bank, 1978).  r e s u l t of the e x t e r n a l and growth  an a l l - t i m e r e c o r d of 2 3  experienced  more  1976  1975  sector  annum and  also  and  agriculture  this  Rice  1970  17) .  (People's  during  production. per  the  during  food food  For  example,  and  other  imports  and  aggravated  the  the  measures  government  imports. the  food  A  decline  availability  as a whole. L i m i t e d p r o d u c t i o n  i n c r e a s e d p r i c e s of food and  other  a f f e c t e d s e v e r e l y the wage earners who  in  consumer items  led  which  c o n s t i t u t e d more than  125  two  thirds  of  the  total  employed  population  i n S r i Lanka.  Such a s i t u a t i o n made the c o a l i t i o n government unpopular a t t h a t time and r e s u l t e d i n a l a n d s l i d e v i c t o r y f o r the UNP the 1977  general  It  is  measures growth units  election.  important  introduced  in  a  number  during  this  to by  note  the  of  that  some  coalition  rural  based  period.  The  of  the  austerity  government  encouraged  small-scale  production  "food  production  d e c l a r e d by the government t o i n c r e a s e l o c a l food was,  (farmers)  Secondly,  number of r u r a l - b a s e d s m a l l - s c a l e i n d u s t r i e s such as (confectionery), provided  rural  poor  and  non-metallic  employment (ILO,  1983b) .  coalition  government,  improved.  For  (Moore, 1985b: austerity economic  for  a  During  the  example,  manufacturing  significant the  last  overall  the  terms  of  the  1977  of  the  period  of  the  trade  improving  effects  81) , the  new  a t the beginning  of the  government  came t o  (UNP)  t h i r d s m a j o r i t y i n the Parliament. had  mushroomed  number  was  p i c k i n g up  and  towards b e t t e r were  l a t e f o r the c o a l i t i o n government t o win a t the In  jaggery  situation  measures began t o work p o s i t i v e l y However,  the  economic  Table 1), food p r o d u c t i o n was  performance.  war"  production  t o a l a r g e extent, t o encourage the producers  by o f f e r i n g h i g h e r p r i c e s f o r t h e i r p r o d u c t s .  and  at  felt  election.  Second P e r i o d power  too  with  (1977a  two-  The economic growth which  a l r e a d y s t a r t e d t o improve a c c e l e r a t e d d u r i n g t h e e a r l y  period reached  of  this  government.  The  annual  i t s h i s t o r i c high l e v e l of 8.2  growth  rate  of  GDP  per cent per annum i n  126  1978.  Though the r a t e d e c l i n e d t o 6.2  per  1979,  i t remained  cent  per  1981  (Table  high  rate  achieved  around  4.1).  How  immediately  5 to was  6 per  such  after  the  a  cent  government  per  annum i n  annum  came  until  of  growth  to  power?  What f a c t o r s c o n t r i b u t e d t o t h i s growth? The reforms  new  government introduced  immediately  after  reforms were entered identified stimulate  as  In e f f e c t ,  on  an  sectors  growth.  imports and  power.  economic  Such  investment" which were  to  activate  To  and  Kooyman,  of  devaluation  banking  welfare  of  the  programmes  system  investment  foreign  and  the  policies  subsidy  493).  Such  exchange exchange  which control  (Fernando, 1986:  &  order  to  this,  all  f o r e i g n exchange were removed.  the f o l l o w i n g elements:  liberalization  inflationary  1985:  in  facilitate  "open economy"(3) p o l i c y was  p o l i c y contains  rice  "exports and  economic  adopted i n  " c l o s e d economy" p o l i c y of the p r e v i o u s  (Gafoor  the  key  economic  restrictions  of the  the  on  i t came t o  a number of  an  import  rate  3)  increased  18-19)  "open  economy"  controls  domestic controls  government  education,  kerosene  and  in  etc.  as  the  foreign in social  well  eligibility  2)  antiin  and  4) a r e d u c t i o n  - health,  years"  1) the a b o l i t i o n or  and  of  seven  place  as  for  the "food  stamps". These sectoral since  "open  growth of  the  implementation.  economy"  policies  resulted  economy d u r i n g  the  first  Between  and  1979,  1978  in  two  the years  trading,  c o n s t r u c t i o n and manufacturing grew a t a r a t e of 26.3,  15.4,  127  and  10.1  per cent r e s p e c t i v e l y . (People's  Bank, 1980:  2).  However, such high growth movements d i d not  long  period  after  and  the  last  growth performance began t o  the high  number of e x t e r n a l and type  slow down  of  growth p e r i o d  (1978-79) f i r s t ,  removal  of  enabled  local  growth.  First,  restrictions  medium  considered terms  of  on  the  highest  imports.  entrepreneurs level  t o be  GDP  growth  trade  "easy way"  (since  Secondly,  1976)  the  demand  activities Lanka  to  in  for the  Middle  Such overseas  Improving  assistance  approach  labour  East  from  of  the  employment  50,000 i n 1979 As  a  result,  and  increased  i n c r e a s e d from Rs 198.4 in  1981.  An  from  70,000 i n 1980  remittances  ILO/ARTEP  the  the  and  from  1985:  from  the annual f l o w of 2500 persons  m i l l i o n i n 1979 study  on  East  Sri 1) . For  Middle  i n 1976  (ILO/ARTEP : 1985: Middle  the  development  labour  (ILO/ARTEP,  new  a v a i l a b l e only s i n c e 1978.  example, a c c o r d i n g t o an estimate Eastern  for  attracted  countries  employment was  were  (Herring 1987:329).  expatriate  Eastern  small  (IMF and World Bank) h e l p e d  liberalized  Middle  t o the  which  government towards m i g r a t i o n and employment overseas massive  in  opportunity  activities  and  levels  the  an  of money-making.  i n t e r n a t i o n a l f i n a n c i a l agencies t o i n c r e a s e the import  Such  due  t o engage i n a number of  trade-related  an  a  i n t e r n a l f a c t o r s have c o n t r i b u t e d t o  t r a d i n g - r e l a t e d a c t i v i t i e s d u r i n g t h i s p e r i o d was  and  for a  1980. Taking  such  Table  to  Table).  employment  t o Rs 2044.3 m i l l i o n  labour  migration  to  the  128  Middle a  East  figure  i n d i c a t e d t h a t i n 1983  which  was  exchange earner made a g r e a t  almost  second  (1985: 119).  impact not  only on  tourists  during  to  tea  as  Such o u t - l a b o u r  a l s o on l o c a l consumption and Thirdly,  such r e m i t t a n c e s  local  the  same  i n c r e a s e d r a p i d l y due  foreign has  situation  but  as w e l l .  period,  t o the  a  migration  labour  investment  reached  the  arrival  increasing attraction  of S r i Lanka t o the Western t o u r i s t s and the c o n s t a n t of  the  government  foreign  to  build  exchange e a r n i n g s .  this  of  industry  It resulted in  as  a  effort  source  of  tourism-oriented  employment o p p o r t u n i t i e s . Fourthly, investment the  Sri  by  rupee.  Zone  (IPZ)  produce  Kooyman, Colombo powers  goods  1985:  this  created  exclusively A  purpose, in  such  for  special  Commission  implement  encouraged  f o r e i g n exchange and  to e s t a b l i s h  493).  Economic to  government  For  was  i n v e s t o r s were i n v i t e d to  new  liberalizing  Lankan  Promotion  the  (GCEC),  a  plan.  1978  devaluation  an  and  foreign  Investment the  foreign  factories  in this  zone  export  (Gaffoor  and  commission, was  the  created  According  to  Greater  with  wide  available  statistics,  a t o t a l of 147 p r o j e c t s were approved by GCEC by  1981.  average  The  size  of  p r o j e c t s approved  f i g u r e of Rs 23 m i l l i o n per p r o j e c t i n 1978 i n 1981. very  high  this  t o Rs 54  from  (around A total  export  40%)  during  of 14,742 people  processing  zone  and  the  first  a  million  The p r o p o r t i o n of garment i n d u s t r y i n t h i s p l a n  period.(4) in  rose  three  was year  were d i r e c t l y  employed  the  (50%)  majority  of  129  them  were  employed  employed  i n the  i n the garment  industry  and s e m i - s k i l l e d l a b o u r e r s Fifthly,  garment  industry.  The  people  were mainly female  (90%)  (Ramanayake, 1983).  the new  government  a l s o undertook a  large  development programme f o r i r r i g a t i o n and h y d r o e l e c t r i c power generation.  The  UNP  government  Mahaweli Development six  years  under  Programme. was and  decided  to  accelerate  the  P r o j e c t and complete i t i n a p e r i o d o f the  Accelerated  Co-operation  from  the  Mahaweli  Development  international  community  sought f o r c a p i t a l requirements of t h i s massive p r o j e c t the  response  encouraging. Project  increased  Finally, (100,00  The  from  developed  investment on several  massive urban houses  the  in five  the Mahaweli  times  between  development years)  countries  and  1978  housing  was  Development and  1981.  programmes  too were undertaken by  the  government. As processing  a  result  zone, tourism,  development,  growth i n c o n s t r u c t i o n completion  of  industrial  sector  expected.  those was  sector, Much  of  i n d u s t r i a l s e c t o r was  establishment  Mahaweli  The c o n s t r u c t i o n  (15.4%) i n GDP  agricultural  the  the c o n s t r u c t i o n  t h i s period. activities  of  development  industry  Though  relatively  growth  housing during  second t o t r a d e  i n 1981 due t o t h e the  higher  i t s performance the  and  export  1978 and 1979. Such r a p i d  suddenly d e c l i n e d works.  the  grew r a p i d l y  i n d u s t r y was  between  of  was  that  growth  than t h a t not  as  occurred  of  the  of  the  high in  i n urban areas which was s t i m u l a t e d  as the by  130  import l i b e r a l i z a t i o n . Employment (1971-81)  is  political  growth  associated  development  of  liberalization  this  policies  noted e a r l i e r  the  under  review  socio-economic at  that  and  time.  From  the impact of the post-1977 had  a  significant  trade  positive  situation. t h a t the  encouraged  trade-related  rate after  1977.  The  period  country  have  impact on the employment  the  with  the a v a i l a b l e i n f o r m a t i o n ,  We  during  l i b e r a l i z e d trade  a c t i v i t i e s which  grew  employment o p p o r t u n i t i e s  policies  at as  a  rapid  a  result  of t h i s have a l s o i n c r e a s e d i n t r a d e - r e l a t e d a c t i v i t i e s . the r e c e n t Table  4.6  persons during also  census i n f o r m a t i o n Part  and this  emerged  in  other  sectors  These  highest  employment  wearing  types  of  trade  contributed such  indicate  s e c t o r absorbed  to  as  For example, as Table of  1981)  a d d i t i o n , the  indirectly  manufacture  persons.  In  and  trade  the  and  transportation. the  retail as  period.  directly  growth  B) , the  (1971  absorber have  employment  manufacturing 4.6  apparel  and  Part B i n d i c a t e s ,  increased  manufacturing  (see  81,113  policies the  As  by  31,260  activities  quickly  emerged as the r e s u l t of l i b e r a l i z a t i o n of import markets. A number of  urban based  medium  industries  labour)  to  consumer  used and  labour  Colombo) and  intensive  manufacture  a  small  methods  number  of  and  (cheap imported  products.  The time  assemble  (particularly  also  development p o l i c i e s contributed  to  adopted by  employment  the  state at  growth.  In  the this  131  respect,  the  employment  industry p a r t i c u l a r l y  opportunities  in  construction  i n the Mahaweli development areas,  investment promotion areas,  i n s t a t e housing p r o j e c t s and  in in  urban development s i t e s absorbed more than 30,000 employees d u r i n g the p e r i o d under review (see Table The  service  related  welfare  (Table  4.6)  government 1987).  sector,  sectors,  which for  the  Finally,  an  was  sector  as  the  important  declining  the  dominant  education  l a r g e number of  (Moore,  concern  1983  absorption  significance sector  in  of  people the  Herring, which  was  between 1971  and  the  labour  and  of  and  s t r u c t u r a l change  of labour  the  a  continuous  electorate  seen from the p a t t e r n 1981  particularly  employed  showed  4.6).  agriculture  absorption  (Table  4.6) . Though the  UNP's "open market" p o l i c i e s  some of the s e c t o r s of the economy t o expand and people,  such  labour  absorption  rural-based. the  policies  The  small-scale  type"  of  industries jaggery some of  making.  contributed  i n some other removal rural  products. were  also  the  import  Some  of  handloom  the  employ more  negatively which were  restrictions  i n d u s t r i e s which  Table 4.7  these r u r a l  of  sectors  encouraged  industry,  mostly hit  "inferior  effected  beedi  the  badly  produced  badly  to  rural  making  i n d i c a t e s the d e c l i n i n g s t a t e  i n d u s t r i e s which s i g n i f i c a n t l y  the number of people employed i n RNA  and of  reduced  related-activities.  1  132  4.2.2.3 The  Period After  The this  UNP  thesis  has  remained i n power u n t i l the  (1988) . The  remained.  However,  declined  around 4 per economic  cent  and  internal  faced  The  trade 1986 The  the  of  funding.  overall  budget  A  capita  GDP  and  which  trade On  economy  has  GNP)  well  The  poor  the  economy  Lankan  to  as  to  Sri  GDP  other  been a t t r i b u t e d  deficit  prices  1987:  the to  do  external  favorable  has  caused cent  an  accelerated  by  over  54  from  the on  UNP  The  second  cent  on the  (Ministry  of  government came  subsidies. i t was  external  1.6).  of  international  partially,  a  and  dependence  per  implement these p o l i c i e s f o r f e a r of p o l i t i c a l 1987).  1978  Table  foreign-financed The  and  increasing  between 1987:  13).  since  import . goods  Planning,  spending this  of  per  average, was  been  have  400  and  pressure  cut  not  prices  deficit an  Planning,  government t r i e d  (Herring,  has  number of  performance.  has  i n the  Finance  increasing to  policy  annum i n 1978  4.1).  balance  export  of  foreign  agencies  the  (Table  which grew by  (Ministry  under  of  cent per  economic  increase  deficit  Finance and  per  economy has  trade  in  balance  economy"  of  1981.  The  decrease  (per  challenges  since  1981.  i n 1988  the  writing  For example, the average annual  declining  performance of  market  performance  from 8.2  indicators  confirmed  "open  the  s i g n i f i c a n t l y declined. growth has  1981  finance  Though not  the  able  to  consequences  f a c t o r was  the  133 T a b l e 4.7: Ten Industry D i v i s i o n s i n Ranking Order ( 3 D i g i t a l Group) Which Show D e c l i n e i n T o t a l Employment, 195381 and 1971-81. a) P e r i o d 1971-81  Employment D e c l i n e  Group No. (ISIC)  Industry D i v i s i o n  Absolute Total Decline  Total Rural Decl.  Total Rural Decl. (%)  221 853 531 214 852 510 612 832 282 021  Manufacture o f T e x t i l e s Repair S e r v i c e n.e.c. Restaurant Cafes... Tobacco Manufacturing Laundries, ... Wholesale Trade Water Transport Research Manu. o f Machinery Forestry  -30408 -15353 -11176 -9900 -9654 -7156 -3246 -1404 -651 -593  -31553 -7038 -8290 -8263 -7316 -2122 +1171 -1550 +93 -346  -48.4 -10.7 -12.7 -12.6 -11.2 -3.3 +1.8 -2.4 +0.1 -0.5  Total  -89541  -65214  100. 0  Repair S e r v i c e n.e.c. Business Service Laundries, Manu. of Trans. Equipment Manu. o f F u r n i t u r e and.. Other S o c i a l & Related Communi. S e r v i c e Real E s t a t e Business ,Professional and Labour A s s o c i a t i o n Manu. o f T e x t i l e s Other Manu. I n d u s t r i e s  -73073 -25368 -17881 -12931 -12776 -7254  -52027 +471 -15830 -6714 -11451 -7321  -41.5 +0.4 -12 . 6 -5.5 -9.2 -5.8  -7167 -6822  -4140 -4791  -3.3 -3.8  -4910 -2251  -17438 -6053  -13.9 -4.8  Total  170433  -125294  100.0  b) P e r i o d 853 732 852 284 232 839 731 835 221 290  1953-81  Source: C a l c u l a t e d from P o p u l a t i o n Census 1953, 1971 and 1981. Department o f Census and S t a t i s t i c s , 1960, 1967b, 1976 and 1983b.  134  decreasing The  terms of t r a d e  government  could  i n export  not  attract  processing more  activities.  investors  to  the  export p r o c e s s i n g a c t i v i t i e s which would g i v e the S r i Lankan economy  a  boost.  garment  industry  investment  and  As which  Internally, as  a  militant  Tamil  homeland  - Tamil  increasing 13.6  per  (1983)  the  indicated,  largest  i n the  export  the  contributor processing  zone',  S r i Lanka f a c e d the worst  challenge to i t s  united  1983,  youth  country.  has  been  Since  fighting  Eelam. S r i Lanka  i n 1986  budget from  f o r an  faced t h i s 3.2  of the t o t a l  the  armed  independent challenge  per c e n t  i n 1982  budget e x p e n d i t u r e .  government too c h a n n e l l e d a l l i t s r e s o u r c e s i n t o the A l l development p r o j e c t s were postponed  which  emerging  since  declined  and  1978. the  affected  food  one  estimated  one  The  output  of  the  The  or c a n c e l l e d . On  lasted  t h a t about 2.4  cultivable  of  situation.  and  major  A  the 1983.  minor  income  in  people  Apart the  in  and  on  1987.  i n eight  and  and  a  reduced It  was  districts  from the drought, Northern  the  droughts  1983  appreciably  i n 1986  million  significantly  several  drought  years  exchange  employment  Secondly,  two  lands  foreign  tourists  i n d u s t r y and  were a f f e c t e d by t h i s drought. of  the  number  production.  which  agricultural  as  tourist  whole f a c e d a grave  major  to  i n t e r n a l i n s t a b i l i t y badly h i t the t o u r i s t i n d u s t r y  was  earners  by  "war".  whole, economic growth slowed down s i g n i f i c a n t l y s i n c e The  to  1979.  i t s defence  cent  was  employment  began t o d e c l i n e a f t e r  existence  Ramanayake  most  Eastern  135  provinces  were not c u l t i v a t e d due t o t h e "war" s i t u a t i o n i n  those areas s i n c e 1983. Another economic a c t i v i t y which was badly  a f f e c t e d by t h e "war" i n t h e Northern and E a s t e r n  of S r i Lanka was t h e f i s h i n g  part  industry.  In s h o r t , t h e employment s i t u a t i o n d u r i n g t h e post-1981 period  has not been  good.  The "employment  boom"  i n the  c o n s t r u c t i o n i n d u s t r y was almost over w i t h t h e c o m p l e t i o n o f major c o n s t r u c t i o n and  housing  completed  employment decreasing  projects  and  war.  selected  sectors  income  is  Secondly, down  Middle  since  creation  and chemical  zone  Eastern  1985  due  i n t h e i n t e r n a t i o n a l market  - textiles  recognizable  employment  slowed  processing  to  and t h e  I n d u s t r i a l growth was c o n c e n t r a t e d  a c t i v i t i e s continued it  i n 1980.  o i l prices  Iran-Iraq  such as export  o n l y on  products.  Trade  t o be dominant i n employment growth but that  the  i n this  quality  sector  and  was  quantity  poor.  The  of only  v i s i b l e area where labour was s i g n i f i c a n t l y absorbed was t h e military  4.2.3  sector.  Over-View o f Trends i n Labour A b s o r p t i o n  During the  Post-Independence P e r i o d  The  discussion  independence  period  on labour  absorption  i n S r i Lanka  during  identifies  the post-  the following  patterns. A.  The s t r u c t u r e  of t h e economy  has changed  slowly  136  but  a t the  in  the  sectoral level,  domestic  significant  agriculture  and  p l a n t a t i o n a g r i c u l t u r e s e c t o r has B. occur  A  significant  with  almost  i r r i g a t e d area  spatial  100,000  of the dry  growth has  service  occurred  sector  while  declined. labour  redistribution did  persons  re-settled  in  zone over a 50 year p e r i o d  the  (193 0-  80) . C.  The  government w e l f a r e  sector  (education,  health-  r e l a t e d i n f r a s t r u c t u r e ) emerged as the second most important s e c t o r of employment D. major  The  absorption.  public  source  for  sector  (government  employment  creation  sector) and  remained the major employment c r e a t o r . The Law,  the  establishment  the  expansion  of  of  the  a public government  became  the  the  government  1972  Land Reform  industrial  sector,  bureaucratic  and  machine  f a c i l i t a t e d such employment c r e a t i o n . E. (e.g.,  Most of the agriculture  labour p r o d u c t i v e F. sectors  The and  employment c r e a t e d  and  some  rural  during  this  industries)  period  were  low  occupations.  traditional  rural  sectors  blacksmiths)  were  disappearing  i n c r e a s i n g market p e n e t r a t i o n  (service-oriented due  to  of manufactured goods i n t o  the the  r u r a l economy. G. and  the  The  sudden p o p u l a t i o n  subsequent  labour  growth between 1948  force  increase  have c o n t r i b u t e d t o the i n c r e a s i n g p r e s s u r e land resource  since  and  1963  late  1965  on the a v a i l a b l e  i n an a g r i c u l t u r a l country and  created  under-  137  employment and open unemployment. H. the  The s p a t i a l and s e c t o r a l employment changes d u r i n g  study  p e r i o d was  largely  due t o the s t a t e ' s employment  and economic p o l i c i e s .  4.3  Employment and Unemployment i n R u r a l Areas  Structural sub-sectoral rural in  areas  changes  i n employment  evident  at  the  Such changes w e r e more prominent i n the  level.  (Table 4.2). T h i s s e c t i o n looks a t t h e changes  l a b o u r a b s o r p t i o n a t the s u b - s e c t o r a l l e v e l i n t h e r u r a l  areas.  The  purpose of t h i s  t h e r e have been s i g n i f i c a n t the  are  sub-sectoral level  situation  out whether  changes i n labour a b s o r p t i o n a t  and a l s o t o f i n d  such employment s t r u c t u r a l market  section i s to find  out the impact of  changes on labour and t h e  i n the r u r a l  areas.  labour  Such an a n a l y s i s w i l l  p r o v i d e us w i t h a b a s i s f o r our d i s c u s s i o n of t h e growth of non-farm a c t i v i t i e s i n r u r a l S r i Lanka. More than t w o - t h i r d s of the 5 m i l l i o n lived  i n the r u r a l  rural  labour  growth  rates  areas.  f o r c e was of  Nearly  17 p e r cent  described  population  l a b o u r e r s i n 1981  and  as the  open  total  unemployed.  labour  r e l a t i v e l y h i g h e r w h i l e employment c r e a t i o n was rural  of t h e  force  The were  lower i n t h e  areas. The  absorption  variations  in  were e v i d e n t  a l s o they were i d e n t i f i e d  the  growth  between  rural  of  sectoral  labour  and urban areas  i n the movement of labour  and  towards  138  domestic  agriculture,  related  activities  open-market  in rural  policy  of  employment s i t u a t i o n years.  The  absorption  not  has  also  and  sector  areas  government,  section  between  the  rural recent  the  labour  sub-sectors  the r u r a l  the  i n the  discusses  the  to  of  rural  p o p u l a t i o n which  creation  and  which  has  has been  reforms.  A g r i c u l t u r e Sector  Within  the  agricultural  a g r i c u l t u r e which i n c l u d e s the coconut  comprised  employment employed  37  this  1981.  Of  more  than  two  activity  economic  per  in  employed p o p u l a t i o n . in  infrastructure-  been badly a f f e c t e d  employment  a f f e c t e d by p o l i c y  and  (Table 4.3.). Due  post-1977  identifies  b e n e f i t e d from  4.3.1  the  following  within  economy and  service  cent this, thirds  relatively  due  to  plantation  major crops of t e a , rubber, of  the  total  the  tea  plantation  of  the  the  high nature  agriculture  total  The p r o p o r t i o n of female  is  activities  sector,  plantation  participation  compared of  sector  tea  with  other  cultivation.  In a d d i t i o n , more than t w o - t h i r d s of t e a p l a n t a t i o n workers were I n d i a n Tamil i n o r i g i n p a r t i c u l a r l y a t the b e g i n n i n g of independence this  sector  between number More  1946 of  than  (People's grew  less  and  1971.  employed 50  per  Bank, than  1980b). 10  Between  population cent  of  such  per 1971  Total  cent  employment  i n the  and  1981,  d e c l i n e d by d e c l i n e was  60724  in  25  years  the  total  persons.  among  female  139  workers  (32556  persons)  S t a t i s t i c s , Various  (Department  Years).  The  of  Census  and  m a j o r i t y of the people  l o s t t h e i r employment were of Indian Tamil  who  origin.  There were a number of f a c t o r s c o n t r i b u t i n g t o  the  slow growth i n employment i n the t e a s e c t o r between 1946  and  1971. for  P r i c e s of t e a a  i n the  long time. (5)  l a c k of  i n t e r n a t i o n a l market f l u c t u a t e d  T h i s and  other  factors resulted in a  i n c e n t i v e t o the development of t h i s  sector  during  the post-independence p e r i o d . However, the tax revenue from tea  exports  was  invested  in  domestic  agriculture.  The  d e c l i n e i n the a b s o l u t e number of the employed p o p u l a t i o n i n the t e a s e c t o r between 1971 1972  Land Reform Law  t e a workers.  and  1981  was  mainly  due  to  the  which d i s p l a c e d a s i g n i f i c a n t number of  Though the Land Reform Law  employment f o r the people who  guaranteed l a n d  worked on the l a n d , the  and  people  of I n d i a n Tamil o r i g i n were not g i v e n l a n d because they were not Of  citizens the  Indian  group origin  Shastri part  and  Pact,  of  Sri  employment and  of  they  were d i s p l a c e d from t e a p l a n t a t i o n s .  displaced  were  sent  others Lanka  tea  back  migrated where  many o t h e r s  they  to to  estate India the found  ended up  workers,  those  of  under  the  Sirima-  Northern  and  Eastern  agricultural  i n the  labour  informal  sector  of the urban economy. The domestic food crop s e c t o r c o n s i s t e d of paddy o t h e r food c r o p s . The in  paddy  was  agriculturally  p r o p o r t i o n of the employed  about employed  78  per  cent  population.  of Paddy  total  and  population domestic  i s primarily a  140  small-holding  s e c t o r and  are below one  a c r e . One  some  form  of  "rural  life"  Therefore,  and  has  traditions  sector  absorption  not but  labour  varied  between  labour  absorption  1981,  to  the  1982  closely associated  and  culture  of  Sri  with  Lanka.  g i v e n much a t t e n t i o n i n the  contributed  to  an  to  increase  absorption  1946  the  d e c l i n e d . I f we  the in  Such  development  the  and  was  in  1981.  noted  absolute  paddy  total  of  labour  A  significant  before  number  cultivation  1971.  But  employed  between this  take the p e r i o d of i n c r e a s e d l a b o r  between 1953  and  1963.  We  has  increase  in  the l a r g e s t share of labour a b s o r p t i o n  occurred  holdings  capacity.  The  first,  paddy  the post-independence p e r i o d .  only  also  of the  according  T h i s s e c t o r was  the paddy s e c t o r was  attention  and  cent  cropping  development p l a n d u r i n g  this  per  t h i r d of the paddy lands were under  share  a g r i c u l t u r e census.  44  1971  sector  (1946-71)  in this  noted e a r l i e r  in  sector  that  some  of the f a c t o r s such as heavy investment i n i r r i g a t i o n works, i n f r a s t r u c t u r e and dry zone c o l o n i z a t i o n schemes c o n t r i b u t e d to  the  If  we  355,000  post-independence take  only  acres  agriculture  the  of  and  period  crown  80  major  colonization  8.5).  The  per  people who  domestic  between  lands cent  schemes  were  of  those  number  of  1953  and  allocated lands  1965, to  about  domestic  were under  (Wickramasekara,  1985  the  Table:  mostly b e n e f i t e d from t h i s development  were l a n d l e s s wet-zone peasants who A  a g r i c u l t u r e development.  were mostly  factors contributed  to  the  Sinhalese. decline  in  141  the  labour  First, where  increasing the  number the  absorption  peasants  studies  rural  areas  paddy  fragmentation  marginal  of  in  confirmed (Hameed,  cultivation of  had an  et  land  to  after  reached  find  the  other  increasing  1971. point  jobs.  A  landlessness  a l . , 1977;  Morrison,  in  1979;  ILO/ARTEP, 1986b and o t h e r s ) . Secondly, S r i Lanka r e c o r d e d  a  v e r y h i g h l e v e l of farm mechanization i n the use of t r a c t o r s for  land  preparation  (ILO/ARTP, Table rose  1986b:  A. 6)  VII).  indicated,  tractor  during  threshing  As  such  from 10,736 i n 1970  t o 23,229 and in  and  the post  in  1979  recent  usage  and  paddy  ARTEP  of  sectors  study  fourwheeler  respectively.  fact,  increased  period.  The  Such an  very  study  (1986:  tractors  two-wheelers from 1311  21,496 i n 1983  usage,  a  in  in  increase  significantly  also  indicated that  the t r a d e - r e l a t e d i n c e n t i v e s were r e s p o n s i b l e f o r h i g h importation tractor paddy  utilization  cultivation  Thirdly, paddy  of t r a c t o r s .  there  was  labourers  during  a marked since  1961  female labour  recent  however, a s h i f t  (shorter  period)  affected  the  which  female  post  1977  number  in transplanting in  which  i n the not  of  period.  has  significantly  inputs i n r i c e - c u l t i v a t i o n .  did  labour  the  expansion  i n c r e a s e d the years,  level  I t i s obvious t h a t the i n c r e a s i n g  would d i s p l a c e a s i g n i f i c a n t  cultivation  1973  new  need  absorption  v a r i e t y of transplanting  in  this  In  seeds has  activity.  F i n a l l y , the r e l u c t a n c e of the young educated t o work i n the paddy f i e l d s i s a l s o a c o n t r i b u t i n g f a c t o r . Though the t o t a l employed persons i n the a g r i c u l t u r e  142  s e c t o r has sector  d e c l i n e d i n r e c e n t years, the n o n - r i c e food  (manioc-cassava,  others)  has  shown  maize,  a  significant  absorption.  The  number  cultivation  has  increased  1971  and  1981.  chillies,  of  employed from  Much of the  red  labour  absorption  this,  farming,  particularly  persons  between  absorption  the  labour  i n poultry,  1971-81).  in  diversification  of  domestic  The Manufacturing  The total  i n the  in  livestock  increased  patterns  of  the  agriculture in  (by  1977  labour  increasing  recent  are i n s t i t u t i o n a l l y  years.  supported  and  i n 1981  not been v e r y  attempt t o develop was  initiated  However, crisis, poor.  in  due the  to  the  the  s e c t o r c o n t r i b u t e d 14 per cent  provided (Table  about  4.1).  impressive  10  The  the  first  population  decade  of from  s t r u c t u r e of  per  cent  growth of  of  ten  year  growth the the the  and  of  total  this  s i n c e independence.  a sound manufacturing  performance  During  seventies,  Sector  manufacturing GDP  employment has  between  b e n e f i t from t h i s development.  4.3.2  the  crop  cowpeas, sesame.  indicate  However, i t i s the farmers who who  also  These  agriculture  food  increase occurred  In  and  labour  3 60,2 00  onions,  to  in  i n non-rice  v e g e t a b l e growing s e c t o r , c h i l l i e s , addition  onions  increase  231,500 t o  crop  sector  The  first  s e c t o r i n S r i Lanka development foreign  manufacturing  exchange  sector  mid-sixties to industrial  plan.  sector  the  was mid-  changed  143  substantially  i n favour of the p u b l i c  establishment  and  expansion  of  i n d u s t r i a l c o r p o r a t i o n s . The total 1968  industrial  manufacturing  GDP  in this  was  in  industries  The  a  66 per  throughout  official  long  history.  expanded t e n - f o l d  the p r o p o r t i o n  of  year  (work  policy For  of  very  from  attention  technology  small  rural  and a l s o d i d not  people  still  actually  3,800 t o over  However,  either  the  rural  by  industries  promotion  of  industry  i n the development  policies  the number of handlooms had  more expansion  classified  as  the  activity  establishment  i t had  b e i n g planned and  1971,  at the  weavers i n c r e a s e d  60,000 e x c l u d i n g those who  until  the  and t h i s  i n about as many y e a r s and by 1970  but d i d not c o n t i n u e w i t h t h i s 23) .  low  interrupted  promoting  example,  By about 1964,  again, with  of  total  i n d u s t r i e s were  t h a t time. In the 20-year p e r i o d between 1951 number  in  difficulties).  The  recently.  doubled  cent  manufacturing  i n t e r m e d i a t e and  significance  the  been g i v e n e x t r a  until  per  cent of the  The r u r a l  handloom i n d u s t r y s t a r t e d as e a r l y as 1964 had  sector  (household i n d u s t r i e s ) were not known s i n c e many  seasons or f i n a n c i a l  had  92  low,  of them had not been r e g i s t e r e d o f f i c i a l l y operate  public  rural  relatively  employment i n 1981.  production.  from  of the  s e c t o r was  s m a l l i n s i z e and they used  of  the  (ILO, 1983b: 2 ) .  contribution  s e c t o r t o the t o t a l  following  share of the p r i v a t e s e c t o r i n  t o under 50 per cent i n 1976  employment  number  production declined  Though the  of  a  sector  were  trained  (ILO/ARTEP, of  the  1986a:  District  144  Development C o u n c i l s sector  (DDC) i n 1971, t h e r u r a l m a n u f a c t u r i n g  had not been p r o p e r l y  developed.  The e s t a b l i s h m e n t  of t h e I n d u s t r i a l Development Board (IDB) i n t h e e a r l y 1970s was  a  step  in  development.  the  The  coordination  policy  of  of  rural  industrial  promoting  rural  industries  remained t h e same even a f t e r 1977 but due t o t h e d i r e c t and indirect  impact o f export l i b e r a l i z a t i o n p o l i c i e s t h e r u r a l  i n d u s t r i a l s e c t o r and employment s u f f e r e d s i g n i f i c a n t l y . Two ILO-ARTEP f i e l d industries Rural  and employment  Small  Industries  surveys on t h e s u b j e c t i n S r i Lanka  and  of t h e r u r a l i n d u s t r i a l s e c t o r surveys  (Kalutara, analysis  were  conducted  i n S r i Lanka  and  and Employment i n S r i Lanka  done i n 1977 and 1986 r e s p e c t i v e l y  Both  (Sethuraman, 1983;  Employment  ILO/ARTEP, 1987 R u r a l I n d u s t r i e s  of r u r a l  provide a c l e a r  picture  and employment i n S r i Lanka. i n three  selected  districts  Kandy and Ampara) which a l s o enable a comparative t o be made.  surveys a r e r e l e v a n t First,  Some o f t h e f i n d i n g s  of these  two  t o our d i s c u s s i o n .  the r u r a l i n d u s t r i e s  employed  on an average  7.5 persons i n each a c t i v i t y . I t was found t h a t a t t h e l e v e l where f o u r  or f i v e  the  industries  rural  employees were h i r e d ,  rural  industries.  rural  manufacturing  was  higher  The p r o p o r t i o n activities  than  the e f f i c i e n c y of  a t other  l e v e l s of  of the h i r e d  labour i n  was  higher;  however,  the  number o f unpaid f a m i l y workers was a l s o s i g n i f i c a n t i n t h e very  small  processing,  industrial coir-fibre,  activities. brassware,  wood,  Secondly,  food  leather-related  145  p r o d u c t s , b r i c k s , s p o t t e r y were the most common manufacturing activities. sector  Thirdly,  were  poor,  industrial  the  though  units  linkages with in  were  1977  about  dependent  on  local  dependent  on  imported  Colombo  was  resources raw  tailoring,  manufacturing  brassware.  F o u r t h l y , the  industrial female  especially beedi  great  poor.  light  making,  etc.)  cent  of  agriculture  raw  non-traditional The  for  institutional  were  dependence  entrepreneurs copper  support  for  on in and  rural  F i n a l l y , the p r o p o r t i o n of  participation  in  per  of chemical, t e x t i l e s ,  a c t i v i t i e s was  labour force  while  agriculture  i n d u s t r i e s were more  materials.  particularly  40  on  m a t e r i a l s . In a d d i t i o n , the t r a d i t i o n a l dependent  the  was  manufacturing compared  with  significantly activities other  higher  (handloom,  manufacturing  activities. The increased and  1971  total  on  employment  average  and  by  in  the  2000 person  5000 persons  manufacturing per  year  sector  between  per year between 1971  and  1953 1981.  Such r a p i d employment c r e a t i o n i n manufacturing i n s e v e n t i e s (1971-81) was For  example,  activities year  the  employment  i n c r e a s e d on  during  indicated this  not shared by the r u r a l manufacturing  the  earlier  period  employment.  later that  average period changing  in one  it  is  a s s e r t i o n w i t h more evidence.  manufacturing  thousand  (1971-81).  persons It  has  government p o l i c i e s  were r e s p o n s i b l e f o r the However,  rural  sector.  slow  necessary  growth to  per been  during  of  rural  support  this  146  Table  4.8  illustrates  the  employment changes between 1971 level.  The  3 digital  rural  and 1981  industrial  manufacturing  at the 3 d i g i t a l  categories which  absorbed  more than one thousand persons during the reference period are reported i n t h i s table. Given the o v e r a l l rural  manufacturing  following occurred  growth  sectors,  the  patterns.  table  First,  i n the manufacturing  illustrates  employment  sectors  which  rooted and established and also dependent materials.  slow growth of the  absorption were deeply  on the l o c a l  raw  In t h i s respect, food, beverages, pottery, & n o n -  m e t a l l i c products l i k e bricks show an increase i n employment though the growth rate was r e l a t i v e l y slow. manufacturing  sectors  such  as  Secondly, some  manufacture  of  wearing  apparel, paper and paper products which had an urban l i n k i n the  form  of  sub-contracting  too  show  an  increase  in  employment. At the same time several other r u r a l industries were almost due  to  stagnant i n production changing  government  and  employment  policies.  particularly  I t was  indicated  e a r l i e r that the post-1977 government p o l i c i e s of opening-up import  markets  had  resulted  in  a  different  pattern  of  manufacturing development between urban and r u r a l areas. The opportunities which were created  by the l i b e r a l i z a t i o n  of  imports were quickly u t i l i z e d by urban based manufacturing firms due to the advantage of being i n the urban areas.  The  poor i n s t i t u t i o n a l support (banking and capital) and lack of  T a b l e 4.8: Employment Change i n R u r a l M a n u f a c t u r i n g S e c t o r (3 D i g i t a l Group), 1971-1981. Employment Change Group No.  Industry D i v i s i o n  Total  211  Food Manufacturing  11514  8146  3368  213  Beverage Manufacturing  3525  3473  52  214  Tobacco Manufacturing  -8263  -3713  -4550  221  Manufacture o f T e x t i l e s  -31553  4678  -36231  222  Manufacture o f Wearing A p p a r e l  12270  2006  10264  232  Manufacture o f F u r n i t u r e  2120  2393  -273  231  Manufacture o f Wood...  1872  1164  708  241  Manufacture o f Paper...  1884  1717  167  242  Printing & Publishing  1264  1092  172  252  Manufacture o f Other Chemicals  2096  2021  75  261  Manufacture o f P o t t e r y  5747  3973  1774  269  Manufacture o f N o n - M e t a l l i c  9646  9097  549  281  Manufacture o f F a b r i c a t e d Metal  5009  4951  58  290  Other Manufactures  2552  1936  616  255  Manufacture o f Rubber Product  2137  1820  317  21820  44754  -22934  Total  Male  Female  Source: C a l c u l a t e d from Census of P o p u l a t i o n , 1971 and 1981. Department o f Census and S t a t i s t i c s , 1976 and 1983b.  148  technology  and  marketing  growth  the  rural  of  industries  facilities  manufacturing  c o u l d not compete  with  worked  against  sector.  the  The  the c o n s t a n t  rural  inflow  of  imported consumer and other products. The  open  manufacturing example,  market activities  Table  manufacturing  policies  4.7  i n the r u r a l  indicates  industries  adversely  in  that 1981  affected  other  areas  as w e l l .  handloom  and  employed  For  tobacco  about  4 0,000  persons lower than the 1971 l e v e l . The l o s s of employment i n those two s e c t i o n s was c o n f i n e d t o women (Table:  4.8).  The  handloom i n d u s t r y which enjoyed a p r i v i l e g e d p o s i t i o n d u r i n g the  pre-1977  period  was  adversely  affected  due  to  the  l i b e r a l i z a t i o n p o l i c y and i n c r e a s i n g number o f powerlooms i n production. the  For example, t h e r e were about  c o u n t r y b e f o r e 1977;  111,000 looms i n  at present there are only  15,000  looms a c c o r d i n g t o the e s t i m a t e s of the M i n i s t r y o f T e x t i l e s (ILO-ARTEP, 1986a:  22).  making a c t i v i t i e s ,  i t was  the  imported  tobacco  tobacco manufacturing The r u r a l government production during rural  the import  leaves  that  restriction  caused  the  p l a c e d on decline  Such  privilege  manufacturing  was  vulnerability  which were  the  period. lack  of  given The  was to t h i s  coordination  between  due  l i n k a g e between  small-scale  to  sector  major problem  r u r a l economy and the a g r i c u l t u r e s e c t o r . Secondly, and  in  i n d u s t r i e s were v u l n e r a b l e t o t h e changes i n  t h e post-independence  linkage  cigar)  activities.  policies. and  In the case o f b e e d i ( l o c a l  of the  lack of rural  149  i n d u s t r i e s and t h e l a r g e scale-urban were  also  responsible.  industrial  policies  creation  The post-independence  mainly  instead  of  As a r e s u l t  growth  rural  umbrella the  growth  between  When such  sector  could  government  a t short-term  o f t h e above,  industries  of protection.  manufacturing  aimed  long-term  generation. of  based heavy i n d u s t r i e s  employment  and  there  employment was a  1970-77  protection  not f a c e  under  rapid the  was removed,  competition  and  disappeared. However,  the  structural  change  in  the  rural  manufacturing s e c t o r d i s p l a c e d a s i g n i f i c a n t number o f r u r a l workers d u r i n g t h e l a t e 1970s and l a t e r . The people who l o s t their  main  unskilled it  was  source  o f income  labourers.  According  t h e female  workers  were  t o the a v a i l a b l e who  employment.  However,  displacement  was t h e i n c r e a s i n g  areas  particularly  workers. trading  The r u r a l sector  the landless  mostly  the s a l i e n t  among  the  lost  feature  unemployment poor  of  poor and  statistics, their  main  this  work  i n the r u r a l  families  and  women  entrepreneurs, however, switched t o t h e  i n the r u r a l  areas when t h e atmosphere f o r  r u r a l manufacturing was not f a v o r a b l e .  4.3.3  Employment Changes i n Other  It  has a l r e a d y  been  dominant s e c t o r i n labour  Sectors  indicated absorption  that  the t r a d i t i o n a l l y  such as t h e a g r i c u l t u r e  s e c t o r d e c l i n e d i n s i g n i f i c a n c e i n r e c e n t y e a r s . A t t h e same  150  time,  new  rural  economy. Tables  in  four  employment  areas  employment was are  retail  of  created  i n other  sectors  of t h e  4.2, 4.3 and 4.6 i n d i c a t e t h a t i t was  the  created  trade,  administration), employment  was  rural  economy  most  of  between 1971 and 1981 p e r i o d .  public  sector  construction  creation  where  had  (education,  and  They  bank  transportation.  implications  on  the  the  and Such  post  1977  noted t h a t t r a d e - r e l a t e d a c t i v i t i e s i n c r e a s e d  along  p o l i c i e s as w e l l . We with  t h e l i b e r a l i z a t i o n of import t r a d e .  sector  grew  activities retail meat,  trading  production,  also rice  significantly  areas.  noted and  after  materials  areas.  The  in this  respect:  i i ) building materials.  that  other  the food  Such  activities  domestic  between  We  agricultural  production, increase  i)  increased  seems rural  to and  have urban  hand, the r a p i d growth of c o n s t r u c t i o n  stimulated during  and  1977.  the t r a d i n g  On t h e other  activities  i n the r u r a l  emerged as s i g n i f i c a n t  and vegetable  already  activated  comparatively  trade  i n t h i s s e c t o r were mixed. However, two a r e a s of  fish  have  faster  The r e t a i l  this  trading period.  in  hardware  Nearly  and  building  85 per c e n t  employment c r e a t i o n i n t h i s s e c t o r was f o r men  of the  i n the r u r a l  areas. We have a l r e a d y  i n d i c a t e d the background development o f  the  construction industry. This  per  cent  cent  of  of the r u r a l them  were  i n d u s t r y absorbed n e a r l y  employment men.  The  (Table:  4.8)  growth  of  and  70  90 per  trading  and  151  construction  industries  transportation  stimulated  industry  the  i n the r u r a l  growth  areas.  of the  The  freight  t r a n s p o r t s e c t o r absorbed most of t h e employment c r e a t e d and the m a j o r i t y Apart another  o f them were again men (93%). from  t h e above  sector  which  absorbed  employment  i n the r u r a l  government  (or p u b l i c )  administration.  Table  types  of employment a  significant  areas was t h e p u b l i c sector  creation,  included  4.6 p r o v i d e s  number  sector.  education,  aspects  the absolute  need t o be emphasized  creation  benefited  people.  I t was very  urban  people  mostly  were  middle  here.  and upper  number o f  women  respect,  employment  class  educated  l i k e l y t h a t t h e educated urban o r semi-  posted  to rural  areas  government s e c t o r . The second aspect of  First,  The  banks and  employment c r e a t i o n i n those t h r e e s e c t o r s . In t h i s two  of  i n these  sectors  example,  the proportion  creation  i n public  was  in  the  i s that the proportion  relatively  o f women  administration  f o r work  higher.  i n t h e new and defence,  For  employment educational  s e r v i c e and f i n a n c i a l i n s t i t u t i o n s was more than 50 p e r cent as  compared  these three  with  the t o t a l  rural  employment  sectors.  At t h e same time, another p a t t e r n was  occurring  i n the r u r a l  s e c t o r s such as blacksmith, etc.  were  Table the  creation i n  declining  4.7 c l e a r l y  employment  areas.  o f employment change  The r u r a l  traditional  pottery, caste-oriented  or disappearing  indicates  i n the r u r a l  t h e numerical  sectors, areas.  s i g n i f i c a n c e of  l o s t i n these s e c t o r s . We s p e c u l a t e d  earlier  152  that  the  increasing  competition  would have been r e s p o n s i b l e  from  urban  produced  goods  f o r such types of changes i n the  r u r a l s e c t o r . I t c o u l d be f u r t h e r confirmed by a number of studies  which  traditional  indicated  sector  Gunasinghe, 1975; is  important  lost  to  their  rural  Brow, 1980; note  that  employment  underprivileged  4.3.4  in  such  Sri  Lanka  Alexander,  the  1.  structural  employment  summarized as  (Silva,  of  to  the  1979;  people  who  poor  and  the  i n the  changes  rural  in  areas.  the  economy  Such changes  are  follows:  Since  the  rural  economic s e c t o r  p a r t i c u l a r l y d u r i n g r e c e n t years,  performed  poorly  the c r e a t i o n of employment  limited. 2.  The  f o l l o w i n g r u r a l people were mostly a f f e c t e d by  s t r u c t u r a l changes  Indian  Tamil  tea  i n the  estate  economy and  workers;  b)  3.  The  relatively  proportion high.  employment:  traditional  o r i e n t e d workers; c) land poor or l a n d l e s s  was  the  1982) . However, i t  majority  belonged  of  community of the r u r a l s o c i e t y .  overall  influenced  the  dissolution  An O v e r a l l Assessment of R u r a l Employment Change  The  was  a  of women among the  a)  caste-  labourers. a f f e c t e d people  153  4.3.5  The S t r u c t u r a l Changes i n Economy and Unemployment Under-employment  The nature  i n R u r a l areas  of unemployment  and under-employment  i s , to  a l a r g e e x t e n t , the r e s u l t of change i n the economy. 4.9 i l l u s t r a t e s the t r e n d s of open-unemployment since  1953.  the r e f e r e n c e p e r i o d had been i n c r e a s i n g i n the r u r a l  areas.  also  r a t e which  i n S r i Lanka during  total  unemployment  Table  fluctuated  Besides  The  and  t h e p r o p o r t i o n of the labour  number and the c h a r a c t e r i s t i c s an  important  aspect  force population, the of the unemployed  of the unemployment.  number of unemployed had been i n c r e a s i n g rural  areas;  unemployed  reveal  unemployment the  a t the same time, number  problem.  unemployed  recent  a  years  characteristics  were  The  salient  total  r a p i d l y i n the  the c h a r a c t e r i s t i c s  of  was  features  o f the of  the  As we have mentioned the m a j o r i t y o f young  provide  a  and  educated.  comprehensive  o f the unemployed  Many  studies i n  analysis  i n S r i Lanka  of  the  (Srivasta,  1973; Jones and Selvaratnam, 1971). Those f i n d i n g s show the  154 T a b l e 4.9: Estimated Unemployment Lanka, 1962 - 1982.  (% of Labour Force) i n S r i  Year  Source  All  1959\60  ILO (1962)  10.5-12.8  1963  CB  13.6  14.6  1964  ILO (1965)  NA  12.5  1969\70  DCS  (1969\70) SES  14.4  14.3  1971  DCS  (1971) Census  18.7  17.3  1973  CB  (1974a) CFS  24.0  24.5  1973  CB  (1974b) LFPRS  18.8  18.3  1975  CB  (1975) LLUS  19.7  NA  1978\79  CB  (1983) CFS  14.75  14.75  1980\81  DCS  (1982) LFS  15. 3  14.6  1981  DCS  (1983d) Census  17.9  17. 3  1981\82  CB  11.7  12 . 0  (1964) CFS  (1984) CFS  Island  Rural 9.8  CB - C e n t r a l Bank of Ceylon, CFS - Consumer Finance Survey of the Central Bank, DCS - Department of Census and Statistics, SES Socio-economic Survey, LLUS - Land and Labour U t i l i z a t i o n Survey, 1975, LFPRS - Labour Force P a r t i c i p a t i o n Rates Survey of C e n t r a l Bank, 1974. Source:ILO/ARTEP, 1986B.  155  difficulties economic  of  and  educated  youth  psychological  who  had  been  as  the  hardship  undergoing result  of  i n c r e a s i n g unemployment. The nature and the impact of unemployment v a r i e d between the d i f f e r e n t income groups of the r u r a l households. Moore  (1981b)  correctly  unemployed  are  population.  Their  unemployment  mainly  points from  the  unemployment  problem:  the  out  that  "the  richer  half  problem  youth  educated of  the  i s not  the  poorer  households  from  total  s u f f e r e q u a l l y , although they are f a r l e s s choosy about t h e k i n d of work they are prepared t o accept. The educated youth have managed t o e s t a b l i s h t h e i r employment problem near t h e top  o f t h e n a t i o n a l p o l i t i c a l agenda, w h i l e the poor a r e not  o r g a n i z e d t o push f o r t h e i r to one  own  and  indeed seem  a l a r g e r e x t e n t t o accept the d e f i n i t i o n o f s i t u a t i o n i n which  public  those w i t h the best have a l r e a d y  sector  jobs  identified  poor unemployed  ought  to  school c e r t i f i c a t e s "  be  provided  (1981b:  as to  105).  We  some u n d e r p r i v i l e g e d r u r a l poor  who  belong t o t h e s e unemployed. the  interests,  Hewavitharana  (1986)  p o p u l a t i o n and i n d i c a t e d  that  analysed " . .  c o n t r a r y t o t h e w i d e l y h e l d view t h a t the poor cannot a f f o r d to  be unemployed  .  . . , the lower per c a p i t a e x p e n d i t u r e  d e c l i n e s show h i g h e r r a t e s of unemployment  . . . they c a r r y  the  compounds  heaviest  unemployment  burden  a l r e a d y heavy c h i l d dependency The productivity  levels  would  be  of the  which  their  burden" (1986: 12). under-employment  appropriate  and  measurement  labour of  the  156  labour  situation  comprehensive  in  an  agrarian  statistics  are  society.  scanty  in  Reliable  S r i Lanka  and  in  this  r e s p e c t . However, i t i s e v i d e n t t h a t the p r e s s u r e  of under-  employment  Professor  i s not  Karunatilake is  i n 1971  a cumulative  fifty  a new  years  said  effect  ago"  phenomenon i n S r i Lanka.  t h a t the under-employment  of  (1971:  a process 24) . He  ".  which began more  was  probably  . . than  referring  to  the development of the p l a n t a t i o n economy and the i n c r e a s i n g population time.  pressure  However,  (underemployed)  on  his in  the  estimation  the  peasant  measure f o r understanding beginning  of  domestic of  rural  independence.  According  Wilson  on work, estimated employed  population  1,348,000 persons  i n 1971  Another  (1986b) r e c e n t  ILO/ARTEP  proportion using  1978/79  survey. 1976;  of  The  are  underemployed and  1981/82  above and  Hewawithrana,  under-employment  had  at  farm  that  families  is  a  useful  the unemployment s i t u a t i o n a t  the peasant s e c t o r i n 1946.  total  surplus  agriculture  615,000 f a m i l i e s were found t o be  of hours spent  agriculture  1986)  surplus  his  farm  Table  5,  families in  (1975), u s i n g the number t h a t about 35 per in  1959/60  underemployed study  population Central  other  to  the  too  studies confirm  of  about  i n S r i Lanka. found  a  that  i n the  higher  S r i Lanka  consumer  (Gunawardena, 1981;  been much h i g h e r  and  in rural  Bank's  cent  finance  Abeysekera, the rural  rate  of  sector  compared t o the urban and e s t a t e s e c t o r and the magnitude of unemployment has been much h i g h e r i n the r u r a l s e c t o r due the u n a v a i l a b i l i t y of land.  to  157  Another  important  aspect  employment i s t h a t such a s i t u a t i o n  of  rural  i s commonly found among  the m a r g i n a l peasants and the l a n d l e s s l a b o u r e r s . been a p r o c e s s  of m a r g i n a l i z a t i o n of  that  by  53  per  the  socio-economic  cent  workers d i d not own than  1  recent  acre  of  survey  agricultural  (ILO/ARTEP,  s t u d i e s on the  1986b:  level  23).  of  and  land and another  There  s m a l l farmers  r u r a l s e c t o r of S r i Lanka (ILO/ARTEP, 1986b: generated  under-  has  i n the The  1980/81  animal  data  showed  husbandry  28 per cent owned  Table  2.6).  A  less  number  of  of poverty i n S r i Lanka showed  t h a t the n u t r i t i o n a l l e v e l as a measure of p o v e r t y i s lowest among  the  landless  unemployed  l a b o u r e r s , marginal  (Wickramasekara,  Jayantha,  1985;  confirmed  in a  Richards number  K a r u n a t i l a k e , 1971  level  of  poverty  and  of  1974;  1985;  poor  (Jones  1986;  1980). and  Hewavitharana,  i s closely  and  Hewavitharana,  Gooneratne,  studies and  peasants  is  Selvaratnam,  1986)  associated with  It  that  the  the  level  of  factors  such  as  labour p r o d u c t i v i t y . From  our  previous  analysis,  p o p u l a t i o n and labour f o r c e growth, economic performance  and  government  for  increasing  policies  emerged  unemployment,  r u r a l S r i Lanka. We  under  as  the  prime  employment  and  causes poverty  in  noted t h a t p o s t - independence S r i Lanka  began w i t h a r a p i d p o p u l a t i o n growth which l a t e r c o n t r i b u t e d to  a  rapid  policies, domestic  on  labour  force  growth.  The  post-independence  the other hand, focused on the development  agriculture  as  a  source  of  short-term  of  employment  158  creation  and  domestic  agriculture  employment  for  this  level  so  that  could  begin.  a  long-term grew  sector the  in  failed  future  The  low  terms to  surplus. of  for  to  low  responsible  f o r the poor performance of t h i s  continued  to  short-term problem. badly goal  situation, Government  thereby  Such short-term  the  main  voiceless  favoritism criteria and  without  nepotism  the  the  underprivileged  rural  any  remedy  immediate  (Gunasinghe,  the  and  short-term policies. 1984)  were  employment.  poor and for  on  applied  the main  of  has  employment  government  recruitment  were  force  focused  aggravating  and  sector.  p o l i c i e s are u n e q u a l l y  and  for  sector  labour  policies  post-independence  expected  development  this  the  implemented. E l e c t o r a l v i c t o r y was of  left  grow.  solution  Political the  this  in  and  investment  relatively  Given  the  economic  higher  productivity  Though  production  perform  integrated  return  labour  economic  minority  their  The were  increasing  problem. Though the employment  did  not  overall  change  s t r u c t u r e of the  significantly,  the  growth towards domestic a g r i c u l t u r e s e c t o r towards the  urban s e c t o r d u r i n g  c o u l d be c a l l e d a s t r u c t u r a l of  unemployment  The  movement  and  and  movements  of  before  1977  the post-1977 p e r i o d  towards  in  the  rural  domestic  hand  created  and  (if i t  increased  landless  areas.  agriculture  s e c t o r d i s p l a c e d Indian o r i g i n t e a e s t a t e workers and other  and  change) c r e a t e d a d i s t i n c t type  under-employment  (development)  economy  on  labourers  the and  159  marginal  peasants  liberalized  in  import  rural  policies  sector.  while  sector displaced  a number of r u r a l  main  income  source  Furthermore, policies  and  of  was  The  favoured poor  based  on  post-1977  in  the  urban  wage e a r n e r s whose those  occupations.  the s e l e c t i v e nature of the government economic employment c r e a t i o n had  s o c i a l ) dimension  i t s other  (ethnic  and  as w e l l . T h i s i s s u e w i l l be c o n s i d e r e d i n  l a t e r chapters. In c o n c l u s i o n , the p r e s e n t employment in  S r i Lanka i s the r e s u l t  rapid period.  demographic The  change  of a slow economic change and during  the  r o l e of government p o l i c i e s ,  a  post-independence however, has  an important f a c t o r i n the economic and employment of S r i Lanka today.  situation  been  situation  160  Notes 1 In the r e c e n t p o p u l a t i o n census, the labour f o r c e (or e c o n o m i c a l l y a c t i v e population) i s d e f i n e d as those who are actually engaged i n production of economic goods and s e r v i c e s and those p o t e n t i a l l y a v a i l a b l e f o r such work. The d e f i n i t i o n s of the labour f o r c e i n 1963 and e a r l i e r d i f f e r from t h o s e used i n the r e c e n t census. 2 D u r i n g the Korean war (1950-51), p r i c e s f o r n a t u r a l rubber r o s e . S r i Lanka earned a s i g n i f i c a n t amount of f o r e i g n exchange d u r i n g t h i s p e r i o d . 3 D u r i n g t h i s p e r i o d , S r i Lanka r e c e i v e d much more generous development loans from the A i d - S r i Lanka Club. 4 Major investment i n the garment i n d u s t r y was f o r e i g n . Sudden growth i n S r i Lanka's garment e x p o r t s i n 1978 t o 1980 i s e x p l a i n e d by i n f l u x of e s t a b l i s h e d A s i a n manufacturers i n t o t h e c o u n t r y t o take advantage of the s h o r t f a l l i n the t e x t i l e quota allowed f o r S r i Lanka by the USA and t h e EEC. 5 Moreover, the owners of the l a r g e r e s t a t e s , both f o r e i g n and S r i Lankan, were r e l u c t a n t t o i n v e s t i n improvements as they f e a r e d n a t i o n a l i z a t i o n .  161  CHAPTER FIVE: THE GROWTH OF RURAL NON-FARM ACTIVITIES IN SRI  This farm  chapter  activities  analysis  LANKA  the changes  i n S r i Lanka  i n this  level  statistics.  used  as  the  evaluates  chapter  i s based  National  main  since  on the a v a i l a b l e  population  source  for  for a  censuses  long  provide  categories  at  classification  time,  censuses  the  detailed the  only  The macro-  have  been  employment-related  statistics  have been  the r e c e n t  information  rural  non-  independence.  i n f o r m a t i o n . Though employment-related available  i n the r u r a l  level.  population  on  occupational  The  occupational  i s based on the ILO d e f i n i t i o n  (1968) and has  been adopted i n censuses a f t e r 1971. Population only  by  primary  censuses  primary  provide  activities.  activities  limits  The  occupational RNA  the extent  categories  analysis  based  of  research.  this  on  F u r t h e r , t h e o c c u p a t i o n a l c a t e g o r i e s g i v e n i n the p o p u l a t i o n census do not a l l o w  for flexibility  non-farm  activities.  inherent  i n the census data.  the  major  These  occupational  i n regrouping  a r e some Using  of the  limitations  the p o p u l a t i o n  categories  of  farm and  census,  professional,  t e c h n i c a l , a d m i n i s t r a t i v e and p r o d u c t i o n - r e l a t e d a r e d e f i n e d as  non-farm  occupational Workers  not  activities. categories classified  Agriculture are treated by  as  and  its  farm  occupational  related  activities.  category  are  162  considered  separately  ( s e e T a b l e 5.2  f o r major  occupational  categories).  will in  In  analysing  be  made t o a s s e s s  relation  the  to  non-farm  overall  after  that the numerical  attempt  activities  development  hypotheses w i l l  be  and tested  g r o w t h o f RNA  has  been  greater  1970; b)  (wage,  that the income,  extent  skill  of q u a l i t a t i v e growth  and  productivity)  s i g n i f i c a n t compared t o t h e n u m e r i c a l c)  that  resulting  the supply-determined  from p o p u l a t i o n  This  growth patterns  first are  and  part;  discussed  o f RNA  the patterns the in  factors the  and  factors  (i.e.,  less  largely  contributed  period. p a r t s . The  of growth which  second;  growth are evaluated  RNA  been  growth;  chapter i s divided i n t o three  i s discussed the  the study  of  has  e x p a n s i o n ) have m a i n l y  t o t h e g r o w t h o f RNA d u r i n g  in  of these  economic  Three major  an  t h i s a n a l y s i s . They a r e : a)  RNA  activities  the performance  the  employment s i t u a t i o n . in  rural  are  growth of identified  contributed and  the  i n the t h i r d  to  the  identified part.  163  5.1 The Growth of Rural Non-Farm A c t i v i t i e s  This  section  growth of RNA. this  analyses  The  first  the  two  numerical  and  qualitative  hypotheses w i l l  be  tested i n  section.  5.1.1 Q u a n t i t a t i v e Changes i n the Growth of RNA  The p r o p o r t i o n a l c o n t r i b u t i o n of RNA growth t o the t o t a l r u r a l employment growth was  58 per cent between  1963-71 and  the p r o p o r t i o n a l c o n t r i b u t i o n of RNA growth reached  80 per  cent  1971-81  of the t o t a l  (see T a b l e  5.1).  rural  employment  The numerical  growth  between  significance  of RNA  i n the  t o t a l employment p i c t u r e i n r e c e n t years was a s s o c i a t e d w i t h first,  the s l a c k e n i n g of the growth momentum i n a g r i c u l t u r a l  activities sixties; created force  as the major employment absorber second,  as and  the  the  result  third,  the  surplus of  the  labour rapid  post-1977  s i n c e the mid-  situation growth  economic  of  income  of  structure  individuals of income  Bank of Ceylon's 1978/79  increasing  and  prominence  is  sources.  seen  in  labour  policies  which  In t h i s  Consumer Finance  of RNA the  was  the  encouraged t r a d e - r e l a t e d occupations i n the r u r a l The  which  areas.  i n the  changes  regard,  in  total the  the C e n t r a l  Survey. 1 9 5 3 , 1 9 6 3 , 1 9 7 3 ,  1980/81 i n d i c a t e s t h a t the r e l a t i v e p r o p o r t i o n  164 T a b l e 5.1: The D i s t r i b u t i o n and Change i n Farm and Non-Farm Occupations i n the Rural Areas of S r i Lanka, 1963-1981. Occupational Distribution  Farm  %  Non-Farm  %  Total  %  1963  1609890  61 .9  960650  37 .0  2598760  100. 0  1971  1712001  59 .7  1101531  38 .4  2867689  100. 0  1981  1785481  55 .3  1378962  42 .8  3226123  100. 0  1963-71  102111  38 .0  140881  52 .4  268929  100. 0  1971-81  73480  20 .5  277432  77 .4  358434  100. 0  25740 76371  17 .6 62 .2  99910 40971  68 .3 33 .4  146249 122680  100. 0 100. 0  235236 42195  67 .7 381 .8  347382 11052  100. 0 100. 0  Inter-Census Increase  Male-Female Increase 1963-71 Male Female 1971-81 Male Female  107881 31 . 1 -34401- 311 .3  Note: 1) The o c c u p a t i o n s t h a t f a l l i n t o 'not c l a s s i f i e d ' c a t e g o r y are not shown i n t h i s t a b l e . But t h i s c a t e g o r y i n c l u d e d i n the t o t a l employment. 2) The d e f i n i t i o n s of farm and non-farm a c t i v i t i e s used i n the c a l c u l a t i o n o f t h i s t a b l e are the same as those i n t h i s chapter. Source: C a l c u l a t e d from Censuses of P o p u l a t i o n , 1963, 1971 and 1981. Department of Census and S t a t i s t i c s , I960, 1967b, 1976 and 1983b.  165  c o n t r i b u t e d to household income by the major o c c u p a t i o n declined  whereas  occupations  have  the  incomes  increased  derived  from  continuously.  although has  is  an  people i n  RNA  a g r i c u l t u r e remains the major a c t i v i t y .  been  more marked  i n recent  decades  the farm households (Consumer Finance  secondary  This  i n d i c a t i o n of i n c r e a s i n g involvement of r u r a l  has  This  trend  particularly  among  Survey, 1964,  1983  and  1984a). The i n Table  o v e r a l l changes i n the r u r a l employment are noted  5.2.  categories  This table i d e n t i f i e s  and  the  extent  of  the major  growth  i n each  major non-farm o c c u p a t i o n a l category related  workers  category  which  total  rural  between  and  transport  includes  employment  1971-81 w h i l e  increase  rate  of  i n the  RNA  The  includes production  and  equipment  other  by  occupational  growth  of  operators.  25  13,000  grew by l e s s than 6000 (see Table This  them.  approximately grew  occupational  per  cent  persons  This of  per  categories  of  the year RNA  5.2.)  seems to  point  to  of p r o d u c t i o n - o r i e n t e d  a  significant  and  production-  r e l a t e d s e c t o r s and probably  i n d i c a t e s an improvement i n the  labour  market  recent  growth  in  indicate categories  the the  broader true  in  RNA  nature  of  occupational  been r a p i d a f t e r 1970,  years.  occupational  i n c l u d e a number of  i d e n t i f y i n g the has  situation  RNA  But,  employment  categories changes  individual  since  does  not  broader  occupations.  In  c a t e g o r i e s i n which growth  the more d e t a i l e d t w o - d i g i t a l ( 1 )  166 Table 5.2: R u r a l Employment Change by Major C a t e g o r i e s , 1971-81. O c c u p a t i o n a l Category  Occupational  1981-71 Total  % Share  45036  12.6  8140  2.3  50348  14.0  S a l e s Workers  20456  5.7  S e r v i c e Workers  23210  6.5  A g r i c u l t u r a l , Animal Husbandry & F o r e s t r y Workers, Fishermen and Hunters  73480  20.5  130237  36.3  7523  2.1  358430  100.0  Professional, Technical & R e l a t e d Workers A d m i n i s t r a t i v e & Managerial Workers Clerical  and R e l a t e d Workers  P r o d u c t i o n & R e l a t e d Workers, T r a n s p o r t Equipment Operators Workers Not C l a s s i f i e d Occupation Total  by  Source: C a l c u l a t e d from Census of p o p u l a t i o n , 1971 and 1981. Department o f Census and S t a t i s t i c s , 1976 and 1983b.  167  occupational  categories  a v a i l a b l e i n the p o p u l a t i o n  r e p o r t s have been used i n t h i s Using census  study.  the t w o - d i g i t a l o c c u p a t i o n a l  reports,  the  census  study,  first,  categories  o f the  identifies  sixteen  o c c u p a t i o n a l c a t e g o r i e s which absorbed n e a r l y 90 p e r cent of the  total  rural  employment  1971-81  (see Table  fastest  growth  category type".  which For  labourers  to  i n an t o as  the  grew a t a phenomenal  increase  category  occupational  was  (Table  category  are u n s k i l l e d  grouped  agriculture  as  twice  these  when  available  income.  the  "labourer  table,  the  (No.  9 9)(2)  rate  i n recent  5.3).  as high  reveals,  those  workers,  (as p a r t - t i m e  labourers. and do  They  move  not have  labourer attached  areas. the  from  of type  t o any  Though  they  with  the  link  occupation)  a  as the next  As the d e f i n i t i o n  and not permanently  non-farm  sector  with  occupational  same  classified  p a r t i c u l a r non-farm s e c t o r i n the r u r a l are  5.3 i n d i c a t e s , the  (No. 99) was 2.8 per cent p e r annum and i n  of absolute  workers  according  period  In percentage terms, the employment growth  category  occupational this  category  occurred referred  elsewhere  (1971-81).  in this terms  i s commonly  not  the census  As the Table  i n employment  example,  occupational years  5.3).  growth d u r i n g  is  stronger  one j o b t o another  regular  employment  or  Table 5.3: S i x t e e n O c c u p a t i o n a l Categories ( Group) Absorbing Nearly 90 Per Cent of T o t a l Increase During 1971 and 1981. Group Occupation No. Labourers (Non-Farm) Teachers C l e r i c a l Workers C o n s t r u c t i n g Workers Govt. S u p e r v i s o r y and F i e l d O f f i c e r s 71 Miners, Quarrymen 21 Managers T a i l o r s , Dress Makers 79 96 S t a t i o n a r y Engine Operators 41 Working P r o p r i e t o r s Salesmen and 45 Shop A s s i s t a n t s T r a n s p o r t Equipment 98 Operators 85 Electrical Fitters 77 Food and Beverage Producers 02/03 A r c h i t e c t s , Engineers 99 13 39 95 31  Total  Increase  Total  Rural  2 Digital Employment  % Share %Female (Rural) (Rural)  73310 41999 41798 36528 31423  76217 31835 28938 23959 ,18498  27 11 10 9 7  20 73 47 5 7  24206 23474 22580 20631  22801 9089 9708 12245  8 3 4 4  7 9 90 21  20091 15601  7938 5286  3 2  -6 54  14408  12928  5  1  9840 9489  6146 7017  2 3  3 30  8324  4397  2  8  393702  277002  100.0  25.0  Source: C a l c u l a t e d from Census of P o p u l a t i o n , 1971 and 1981. Department o f Census and S t a t i s t i c s , 1976 and 1983b.  169  Another o c c u p a t i o n a l category which  shows  teachers the  a  (No.  significant  13,  see Table  rural  employment  Characteristically, categories d i f f e r occupation and  while and  employment 5.3).  growth  The  increase  g r e a t l y . For  employes  teaching  income  villages,  persons  the  same  'teachers'  example, the  prestigious  groups  while  Assuming  in  occupational type  low-income  rural  that  the  the  occupations  form  the  spectrum, were  the  rural  higher  areas.  type  of  In  incomes  i s perhaps the  low-income high-income  the  sixteen  re-grouped  on  is  least  d e s i r a b l e type  ends  of  type the  rural  type-categories scale  income  was  highest  increase  i n the  less  per c e n t .  The  i n c r e a s e at the high income d e s i r a b l e type  the  end  of  increase  falling  (Table  d e s i r a b l e type  s c a l e was  within  5.4).  two  these  40 two  increase  and  employment  these  the  of  I t was  at  that  of  extremes. at one  per  in  extremes  RNA  Employment  extreme was  cent.  of of  desirability.  the  discovered  a  Lankan  most p r e s t i g i o u s  desirable  extreme  and  people.  less  two  Sri  employment  a v a i l a b l e to r u r a l  and  categories  of  households  p r o v i d i n g employment to middle  teaching  occupations  employment  from  labourer  o c c u p a t i o n normally  other  the  period.  labour  i s government employment w i t h  unskilled  employment  of  i s commonly a s s o c i a t e d with low p r o d u c t i v i t y , low  g r e a t e r p r e s t i g e and  upper  that  10 per cent of  during  ' l a b o u r e r s ' and  was  employment growth i n  'teachers' o c c u p a t i o n a l category was  total  pay  at the t w o - d i g i t a l l e v e l  51 on  Occupational show a  lower  Table 5.4: O c c u p a t i o n a l C a t e g o r i e s i n Which 90 Per Cent of Employment Growth Occurred i n R u r a l Areas, 1971-1981. (ReGrouped Using Table 5.3). Re-Grouped O c c u p a t i o n a l Category  %  Total Increase  Government Jobs  40  108841  Non-Governmental Low Paying RNA  51  137971  Other  09  24044  100  270856  Employment  Total  Notes: T h i s r e - g r o u p i n g i s based on the Table 5.3. The Government jobs i n c l u d e f o l l o w i n g the two d i g i t a l c a t e g o r i e s such as No. 13, 39, 31, 02/03, 9, 98 and 96 i n T a b l e 5.3. L i k e w i s e , non-governmental low paying RNA c a t e g o r y i n c l u d e s No. 99, 95, 71, 79, and 45 and other employment c a t e g o r y i n c l u d e s No. 85, 41, 21 and 77 (see Table 5.3 f o r the d e s c r i p t i o n of o c c u p a t i o n a l c a t e g o r i e s ) . Source: Re-Grouped and C a l c u l a t e d from Table 5.3 which i s based on the Census of P o p u l a t i o n , 1971 and 1981. Department of Census and S t a t i s t i c s , 1976 and 1983b.  Another activities different dress  Ninety  of  i s the share  the  increase  of female  labour  occupational categories.  makers'  (relatively about  dimension  poorly  10,000 per  and  similar  paid  employees  cent  of  these  rural  occupational  rural were  absorbed  areas female  non-farm  i n the growth of  For example,  occupations) in  of  'tailors, categories  a  between  total  of  1971-81.  (see T a b l e  5.3).  L i k e w i s e , the s c h o o l teacher o c c u p a t i o n a l c a t e g o r y too shows a  higher  p r o p o r t i o n of female  employment  and  increase  (73  %).  The  category  productive  and  situation  while  of is  number  'teacher'  characterize that  the  of  employment  between  81. T h i s  manufacturing  of  labour  RNA  has  in  sector  have  been  a d m i n i s t r a t i v e and c l e r i c a l cadres.  surplus with  areas.  are,  been  also first,  increasingly  change  recent  shows t h a t  less  growth  They  (proportional  occupations  the  is  associated  changes.  sector  clerical-related and  the is  features  administrative  1971  with  makers  o p p o r t u n i t i e s i n the r u r a l  manufacturing  providing  dress  category  other  recent  and  associated  increasing educational A  tailors  8.1%)  years  and  especially  the u n i t s expanding  comprising to  require  At the same time,  there  i s a l s o seen a change i n the nature of manufacturing towards assembling the  of imported  items and g r e a t e r  s o p h i s t i c a t i o n of  garment manufacturing i n d u s t r y . A l l these i n d i c a t e t h a t  the r u r a l manufacturing s e c t o r i s moving towards more modern forms of p r o d u c t i o n . and  ILO/ARTEP  proportion increased  T h i s has been confirmed by ILO  (1987)  of  studies  administrative  as  and  well. clerical  (1983b)  Likewise,  the  occupations  has  i n the f i n a n c e - r e l a t e d s e c t o r which was the r e s u l t  of the r e c e n t  changes i n the economic p o l i c i e s .  new  patterns  of  the  structural  sectoral  occupational  improvement  i n parts  The  absorption of  the  above  disclose  rural  labour  f o r c e i n r e c e n t decades. But,  not  a l l the  shown an i n c r e a s e have  shown  rural  i n numbers.  a significant  occupational  categories  Some o c c u p a t i o n a l  decline  particularly  have  categories during  1971  172  and  1981.  that  ten  This  aspect  occupational  i s shown i n Table categories  showed d e c l i n e i n t o t a l found  mostly  (e.g.,  employment.  in traditional  blacksmiths,  manufacture).  The  which  shows  ranking  order  which  Employment d e c l i n e i s  activities  laundry  impact  workers  of t h i s  r u r a l areas and households was The displacement  in  5.5  i n the and  rural  cottage  areas textile  employment d e c l i n e i n the  e x p l a i n e d i n chapter 4 .  of labour from the t r a d i t i o n a l  of the r u r a l economy i s one of the important  sectors  f a c t o r s f o r the  r a p i d growth of the 'undefined o c c u p a t i o n a l c a t e g o r i e s ' (No. 9)  which were commonly a s s o c i a t e d w i t h  l a b o u r . The in this  could  not  find  the  areas  and  as  total  this  i n the r u r a l areas. employed  instability  gives  not us  of  of  i s included  and  reason  occupations  in  were  included i n  an  they  i n the p o p u l a t i o n  censuses.  277,000 persons  in  During the l a s t t h r e e decades, the in  this  category  i n the r u r a l areas. the  has  increasing hand  insecurity  of  those workers who on  the  numerical  one  d e f i n e d category,  and  been  The above t r e n d  the  precisely  on  steady  c o n s i s t e d of  indicates RNA  and  result  population  employment  significance  the  a  category  increasing particularly in  secure  o c c u p a t i o n a l category  Numerically, 1981  quality  In other words, most of the d i s p l a c e d r u r a l  labourers  undefined  low  ' l a b o u r e r ' type r e f e r r e d t o e a r l i e r  group.  rural  the  the  t o assume an i n c r e a s e of RNA  increasing were i n  other.  This  because of a  173 Table 5.5: Ten O c c u p a t i o n a l C a t e g o r i e s i n Ranking Which Showed D e c l i n e i n T o t a l Employment, 1971-1981.  Order  Employment D e c l i n e Group No.  Occupation  Total  Rural  Rural (%)  75  Spinners, Weavers and K n i t t e r s  -35814  -33420  54  Maid and R e l a t e d S e r v i c e Workers  -14306  78  Tobacco  56  Female  (%)  47.1  98  -6168  8.7  27  10821  -9403  13.3  49.0  Launderers and R e l a t e d Workers  10788  -6754  9.5  29.0  37  Mail Distributing Workers  -6633  -1069  1.5  4.0  94  P r o d u c t i o n and R e l a t e d Workers Not Elsewhere C a t e g o r i z e d Category  -5916  -5710  8.0  99.0  83  B l a c k s m i t h , T o o l makers -4464 and R e l a t e d Workers  -1741  2.5  7.0  60  Farm Managers and R e l a t e d workers  -3985  -3468  4.9  5.0  20  Legislative Official R e l a t e d Category  -3735  -979  1.4  0.0  57  H a i r d r e s s e r s , Barbers and R e l a t e d Workers  -3241  •2234  3.1  2.0  -70946  100.0  Total  Preparers  •99703  Source: C a l c u l a t e d from P o p u l a t i o n Censuses, 1971 and Department of Census and S t a t i s t i c s , 1976 and 1983b.  66.0 1981.  174  concentration  of  persons  in  occupations  having  less  prestige. In summing up, we note l a r g e i n c r e a s e s i n two  opposite  c a t e g o r i e s of employment c o n s i s t i n g of low p r e s t i g e types on the  one  hand  and  in  high  Increase  improvement expansion  the  qualitative  the  5.1.2  types  non-farm  lower  improvement  t o t a l growth i n RNA  prestige  prestige  in rural in  high  types denote  occupation.  grade  show  on  the  other.  a  qualitative  However,  that  the  has not kept pace w i t h  rate  of  the r a t e of  as e x p l a i n e d below.  The Q u a l i t a t i v e Changes i n the Growth of RNA  The  qualitative  improvements important  in  for  changes  in  productivity, economic  labour  income  development  such  and  wage  than  the  as  the  are  more  numerical  changes i n l a b o u r . An assessment of the q u a l i t a t i v e in  large  RNA  growth  is difficult  due  t o the l a c k  of  changes  statistical  data on l a b o u r performance. However, income and wage l e v e l s , skills  and p r o d u c t i v i t y  of labour are used i n t h i s  section  t o assess the s i g n i f i c a n c e of the numerical growth of RNA i n S r i Lanka. The labour  income  level  performance.  and  wage  Income  and  rates wage  are by  indicators occupation  l a r g e l y determined by e x i s t i n g market demand f o r and of that  labour. of  However, i n an a g r a r i a n and r u r a l  S r i Lanka,  several  non-market  factors  of are  supply  society  like  too p l a y  a  175  role  i n this  process.  For example,  where f a m i l i e s a r e normally amount owned  of manpower enterprises  financial assess further  example  enforced. are  labour  to provide  rural  specified  which they a r e not remunerated  considerable In  without  i n monetary  S r i Lanka.  and  rural  higher areas  There  wage  i n a l l major compared  areas,  white  s o c i e t y , "lower" services  occupational areas  collar-related  levels  occupational  categories  groups.  (Table  are evident  The lower  The low income  a r e found  status  5.6). W i t h i n  be  digit),  some of the lowest  "labourer"  (Gunawardena,  type  of  1981:42).  rural  h i g h e r income than income  occupational  a g r i c u l t u r e and s e r v i c e of such  occupations  is  level  income groups a r e found t o  workers The  t o be  (occupational  more pronounced a t the two d i g i t income l e v e l . At t h i s (two  urban  i n t h e urban  occupations  are production-related,  occupations.  castes  by custom f o r  categories  c a t e g o r i e s 1 t o 4 i n Table 5.7) r e c e i v e d other  A  financially.  The income  to rural  actual  terms.  i s a marked d i f f e r e n c e between  rates.  family  relationships are  V a r i a t i o n s i n wage r a t e s and income l e v e l s in  sector  i t i s not p o s s i b l e t o  may be seen where c a s t e  In t h e t r a d i t i o n a l  required  is utilized  Therefore,  of t h i s  is a  f o r employment.  labour  remuneration.  t h e value  l a r g e , there  available this  i n the r u r a l  who  Labourer  sell type  their  labour  occupational  group i s one of t h e most p o o r l y p a i d i n the r u r a l areas (see Table 5.7).  176 T a b l e 5.6; Average Monthly Income ( per Person) by O c c u p a t i o n a l C a t e g o r i e s , 1981/82 ( S r i Lankan Rupees) Occupational D i v i s i o n  All Urban Island  Professional, Technical & R e l a t e d Workers A d m i n i s t r a t i v e and Managerial Workers C l e r i c a l R e l a t e d Workers S a l e s Workers  Rural  Estate  815  1068  719  305  2448  2780  2249  517  945  1034  871  1301  2065  969  750  1195  S e r v i c e Workers  684  850  567  395  A g r i c u l t u r e , Animal Husbandry & F o r e s t r y Workers, Fishermen, Hunters  551  934  602  333  Production & Related Workers, T r a n s p o r t Equipment Operators  674  1132  639  562  446  493  435  313  706  1094  665  347  Workers Not C l a s s i f i e d Occupation Total  by  Major  Source: C a l c u l a t e d from Consumer Finance and Socio-Economic Survey, 1981/82. C e n t r a l Bank of Ceylon, 1984b.  177 T a b l e 5.7: H i g h e s t and L o w e s t Income R e c e i v e r s b y O c c u p a t i o n s (2 D i g i t a l G r o u p ) i n R u r a l A r e a s , 1 9 8 1 / 8 2 . a)  T e n H i g h e s t Income R e c e i v e r s  Group O c c u p a t i o n No.  Aver. Monthly Income P e r P e r s o n (Rs.)  98 21 15 70 20 30 38 50 41 31  T r a n s p o r t Equipment O p e r a t o r s Managers A u t h o r s , J o u r n a l i s t s & R e l a t e d Workers Production Supervisors L e g i s l a t i v e O f f i c i . & Govt. Adminis. C l e r i c a l Supervisors Telephone & Telegraph O f f i c i a l s Managers(Catering & Lodging) W o r k i n g P r o p r i e t o r s ( W h o l e s a l e and Retail) Govt. S u p e r v i s o r y & F i e l d O f f i c i a l s  b)  Ten L o w e s t  91 80 63 54 75 78 11 14 62 56  Paper & Paper Board Makers S h o e m a k e r s & L e a t h e r Goods W o r k e r s A g r i c u l t u r e & A n i m a l Husbandry Workers Maid R e l a t e d Housekeeping S e r v i c e s S p i n n e r s and Weavers Tobacco P r e p a r e r s Accounts Workers i n R e l i g i o n L i v e s t o c k Farmers Launderers  2403 2307 1830 1649 1550 1431 1285 1261 1239 1023  Income R e c e i v e r s 200 200 343 354 369 380 388 440 463 478  S o u r c e : C a l c u l a t e d f r o m C e n t r a l Bank o f C e y l o n ' s C o n s u m e r F i n a n c e a n d S o c i o - E c o n o m i c S u r v e y ( 1 9 8 1 / 8 2 ) , 1984b.  178  The rural from  'labour  economy  type  for several  t h e census  confirmed  category'  by  i s very  reasons.  i n f o r m a t i o n as  a  number  of  significant  First,  indicated  micro-level  i t is  earlier  studies  W i c k r a m e s i n g h e , 1980; P e r e r a a n d G u n a w a r d e n a , proportion in  the  landless  of labour  rural and  type  of p o p u l a t i o n  sector.  This  land-poor  workers.  i n the evident  and  (Moore  has  been  nearly half  reported  that  i s relatively  labour  category  Though  there  of the t o t a l  1986; ILO/ARTEP,  rural  1986b:22).  that  a number o f t h o s e  work  as  their  landless  main  The p r e s e n t  occupation  f o r part of t h e i r The  period.  overall  an  income  pronounced Bank  of  addition,  rural  showed  non-farm  areas,  while  a r e employed i n  not  improved  of the G i n i  over  Ceylon,  wages  after  1984a:  over  increasing  187;  the  i n 1981/82  inequality  1978/79  Colombage,  the  C o e f f i e n t based  period  1986:  from  indicate  i n t h e income d i s t r i b u t i o n  such  immediately  ( 1 9 8 0 : 100) i n d i c a t e d real  has  i n 1978/79 a n d 0.52  has t h e r e been any o v e r a l l  in  study  income by income r e c e i v e r s w h i c h i n c r e a s e d  increasing inequality In  for  time.  rural  i n 1973 t o 0.49  Lanka.  account  (Hewavitharana,  field  i s agriculture  Instead, the estimates  on one month 0.41  i n the  direct economy,  l a b o u r e r s a r e d e p e n d e n t on  o t h e r s whose m a i n o c c u p a t i o n RNA  force  high  comprises  i s no  labourers  labour  and  1980) t h a t t h e  estimate of the extent of landlessness i n the r u r a l it  also  inSri is  more  (Central  24).  improvement i n r e a l wages.  Neither ESCAP  t h a t t h e r e has been a g e n e r a l d e c l i n e the  1963-71  period.  ILO-ARTEP  study  179  ( 1986b:  106)  confirmed  wages h a v e c o n t i n u e d the  early  that  1980s due  time.  situation  of  these  trends  a n d was  to the i n f l a t i o n a r y  income  poorer The  the  falling  studies  real  aggravated i n  price  relate  in  increases  at  to the o v e r a l l  i n S r i L a n k a , i t h a s b e e n shown b y o t h e r s t h a t t h e  generally  to  such  e v e n a f t e r 1970  Although  conditions  sector.  that  receivers  than  argument  rural  i n the  conditions therefore  areas.  The  of  rural  those  applies  with  deteriorating  sector  are  i n the  urban  greater  force  real  incomes  and  wages h a v e a f f e c t e d t h e wage e a r n e r s g e n e r a l l y . H o w e v e r , t h e e f f e c t s on l o w i n c o m e g r o u p s w e r e more p r o n o u n c e d . The  low  received  very  income  income low  receivers  (Central  Bank  group  wages.  For  received  of Ceylon,  were  numerically example,  less  than  1984a).  larger,  one-third  Rs  500  The m a j o r i t y  w o r k e r s w e r e d e p e n d e n t on t h e i r m a i n o c c u p a t i o n their and  total  income.  According  Socio-Economic Survey  179),  f o r the  income  last  received  t o 1981/82  (Central  income  group  from t h e main  the  the higher  per  of  was  month  of the poor f o r most  the  of  Finance  Ceylon,  0-200,  the  1984a:  share  about  of  88  per  declined  i n c o m e g r o u p a n d i t was  only  57 p e r c e n t f o r  i n c o m e r e c e i v e r e a r n i n g more t h a n Rs 5000 p e r month. The most  is  Rs  of  Consumer  occupation  c e n t whereas t h i s share g r a d u a l l y in  Bank  and  the  instability  Gunawardena workers  striking  (1981:  recruited  employment  and  insecurity  43-44) on  a  problem of the r u r a l  indicated  casual  basis  of  their  poor  employment.  that  the r u r a l  had  no  hired  assurance  of  180  p e r m a n e n c y i n e m p l o y m e n t . The in  t h e i r w o r k had  to  certain  ( f a r m and  and  protection against risks  and  seasonal  nature  of  has  not  been  a  productivity  i n p e a s a n t a g r i c u l t u r e was  4).  The  and  traditional  in  handloom,  labour  a  areas.  category  levels  are  (Table  rapid  increase  5.3)  aggravates  expressed  poor  of  diverse  of the q u a l i t y 1978;  significantly  level  earlier  (e.g.,  traditional labourers  in  compared  to  poor  numbers the  and  in  labour  the  market  areas.  of l i f e  Laksman,  agreement t h a t the q u a l i t y  worst  low  ILO-ARTEP, 1 9 8 6 a ,  Their  skill  The  traditional  sectors (manufacturing,  The  deteriorated' since the  1983;  low  manufacturing  1984:  of  have  years.  i s r e l a t i v e l y low  number  Karunatilake,  improve  activities  improvement  in rural  significant  i n the r u r a l  changing nature  general  the  labour  referred to  Bangasser,  s e c t o r , ILO,  others.  Scholars  1977;  and  T h e s e two  employ  situation  rural  i n recent  s e r v i c e sectors too  Sethuraman  house m a i d s ) .  rural  labourers  productivity level  r u r a l manufacturing  of  t o the  significant  among r u r a l  those  attached  labour p r o d u c t i v i t y i s generally  particularly  the  hours  F u r t h e r m o r e , u n d e r - e m p l o y m e n t among  same t i m e ,  there  service)  long  non-farm).  the  (Chapter  spent  o f w o r k e r s i s v e r y common due  factors  At  legal  duties.  labour category surplus  no  w o r k e r s who  1973.  opinions  i n S r i Lanka(3)  1976, of l i f e  during  1963-73  The  consumption  during  1970-77  about  1980). situation and  that  situation  period  due  the (Lee,  There  is  did  not  i t  has  reached to  the  181  unavailability the  of  currency  food  after  items.  the  Devaluation  of the  i n t r o d u c t i o n of  the  value  open  of  market  p o l i c y a f f e c t e d the poor a d v e r s e l y because they were a l r e a d y l i v i n g below the p o v e r t y fell  to even lower  worsening  levels.  quality  T h e i r l e v e l s of  life  situation  among  (Wickramasekara,  1985;  .  . the steady  fall  in real  rural  labour  improvements f o r some s u b - s e c t o r s groups  in  the  rural  teaching-related  shown a  and  The  education. institutions other than  other  in  employment those  of  occupations services  and  of the  few  increase during of  those  those  sector (e.g.,  workers.  related  institutions  the  to in  The the the  there  were  in  have noted t h a t  last  two  have three  received  wage  rates  increase  areas.  The  and  better  in  of  some  sector  somewhat  proliferation rural  to  government  pension)  to  production-  occupations  enjoyed  rapid  confined  other  employed  employed  rural  benefits  other  was  a  was  government-related  majority  Most  and  favorable  selected occupational  (e.g., c o n s t r u c t i o n ) . We  significant  decades.  and  not  force,  Improvement  occupations  r e l a t e d occupations white-collar  areas.  quartile  27).  Though the income and wage s i t u a t i o n was the  ".  be r e p r e s e n t a t i v e of a more  g e n e r a l d e c l i n e i n l i v i n g standards"(1985:  of  regard  (1985) i n d i c a t e d  incomes of the bottom  over the p e r i o d 1973-1981/82 may  majority  certain  ILO/ARTEP, 1986b). With  the r u r a l standard of l i v i n g Jayantha  the  a  (e.g., l a n d l e s s l a b o u r e r s ) i n r u r a l S r i  to  for  consumption  A number of s t u d i e s i n d i c a t e d  of  o c c u p a t i o n a l groups Lanka  line.  these  welfare rapid  182  increase  i n these  significant  employment  impact  i n terms  indicators i n rural  groups  impact  i n the r u r a l 1980,  of  i n social  society.  areas.  skilled  ILO/ARTEP study  of t h e s t a t e have a l s o made  The c o n s t r u c t i o n boom d u r i n g provided and  employment  unskilled  (1986a) noted  for a  rural  1977 and  significant  labourers.  a significant  author  Statistics unskilled wage  found  from  (1984c)  the d i s p a r i t y  and c a r p e n t e r s )  the u n s k i l l e d worker. open-market p o l i c y  related  rural  rural  between  was twice  Secondly,  people  Middle-Eastern  Thirdly,  countries  summarize,  the RNA  and government-related  skilled  as t h a t o f  opportunities f o r and  clerical-  i n manufacturing  (wearing  (rural  also  banks) s e c t o r s i n t h e o p p o r t u n i t i e s i n the  helped  to  reduce  the  situation.  growth was c o n c e n t r a t e d  s u b - s e c t o r s of t h e r u r a l economy.  these  as high  and  t h e government's post-1977  the employment  d e t e r i o r a t i n g r u r a l employment  in  and Wage  the s k i l l e d  i n managerial  particularly  t r a d i n g and f i n a n c e  areas.  To  1983 P r i c e  c r e a t e d new employment  young  occupations  apparel),  However,  l a b o u r was c o n s i d e r a b l e and t h a t i n f a c t ,  (masons  educated  C e n t r a l Bank's  The  improvement i n  wage and income l e v e l s f o r workers i n t h i s s e c t o r . the  had a  on some s e l e c t e d o c c u p a t i o n a l c a t e g o r i e s  f o r example,  number  has  of the improvements  Other economic i n i t i a t i v e s a positive  i n fact  occupations.  i n two  They were low p r o d u c t i v e Employment  two c a t e g o r i e s of occupations  growth r a t e s  were not o n l y  rapid  183  but  also  several  times  higher  than  any  other  o c c u p a t i o n a l category p a r t i c u l a r l y between 1963 Though these increase,  the  occupations type  and  of  v a r i e d . The low  has  been  changes  years.  But  these  was  was  a s s o c i a t e d with  the  two labour  poor and  d e t e r i o r a t i n g f u r t h e r . Growth  of  surplus  the this  labour  c o n f i n e d to the lower  households.  Government-related significant  between  occupations  s i t u a t i o n i n the r u r a l areas which was s t r a t a of the r u r a l  1981.  q u a l i t y of employment i n the  productive  occupation  and  o c c u p a t i o n a l c a t e g o r i e s have shown an  qualitative  other  situation type  two  single  increase  occupations  in  government  quality  of  employment  have  not  shown  employment  has  in  security,  a  recent  reasonably  h i g h wages and other b e n e f i t s and a t t r a c t s educated youth i n the r u r a l  5.2  The  areas.  F a c t o r s Which C o n t r i b u t e d to the Growth of R u r a l  Non-Farm A c t i v i t i e s  T h i s s e c t i o n looks at the mechanisms used t o RNA  growth  development"  in  S r i Lanka which  was  since  independence.  given  "top"  The  priority  development p o l i c i e s  c o n t r i b u t e d to a number of  changes i n the r u r a l  society.  and  The  expansion  the R N A as w e l l as the over a l l growth of  f a c i l i t i e s are some of them.  stimulate "rural in  the  associated  in agriculture infrastrutural  184  5.2.1  A g r i c u l t u r a l Development  F i r s t , we may sector  and  and  RNA  look a t the development  activities.  With  r e g a r d t o the c o n t r i b u t i o n of the a g r i c u l t u r a l s e c t o r  i n the  growth  the growth  of the a g r i c u l t u r e  of  RNA,  Chada  of r u r a l non-farm  ( 1985)  indicated  that  ".  .  .  the  f a s t e s t growing a g r i c u l t u r e i s capable of g e n e r a t i n g i ) h i g h and r i s i n g and  l e v e l s of on-farm employment and income, i i ) new  expanding  especially iii)  of  non-farm  f o r the weaker  rising  demand  requirements of  avenues  for  sections  products  l e v e l s and s t r u c t u r a l change and i v ) a f a i r  of  purchased  of t e c h n o l o g i c a l  non-agricultural  employment the  and  a r i s i n g out  the  effects  to  of  i n r u r a l consumption  are v e r y w i d e l y  the  consumption  higher  degree of i n d u s t r i a l growth,  of which  society, meet  the  towards a g r o - i n d u s t r i a l i z a t i o n and economic  income,  rural  inputs  changes,  and  income  patterns,  heavily  biased  tertiarization,  dispersed  i n space."  (1985:4) In  spite  agriculture of  this  of a s i g n i f i c a n t p r o d u c t i o n  increase  (People's Bank, 1984a), the o v e r a l l performance  sector  in  the  contribution  of  RNA  i m p r e s s i v e . There were a number of f a c t o r s which the  forward  the  rural  rural crop  in rice  and backward non-farm  sector,  i n d u s t r i a l sector. produced  linkages  mainly  of r i c e - c r o p  p a r t i c u l a r l y the Because  rice  f o r subsistence,  was  not  prevented  sector  with  rice-related  is a  small  mere  increases  y i e l d d i d not n e c e s s a r i l y generate a d d i t i o n a l RNA.  holder  As  in rice  185  farming  was  occupation/  the  Therefore, strong the  considered  farmers  increases  rice  wet  generally  did  not  to tend  be to  a  full  engage  in  RNA.  i n r i c e - p r o d u c t i o n d i d not encourage  raw m a t e r i a l - r e l a t e d  rural  industrial  a  sector i n  o r i n t h e d r y zone.  C o c o n u t , u n l i k e r i c e , i s a p r o d u c e t h a t has uses  time  and  growth  has  of  led  to  related  greater  RNA  generation  industries.  The  industrial  through  major  the  processing  a c t i v i t i e s w h i c h w e r e b a s e d on c o c o n u t raw m a t e r i a l s a r e t h e following: fibre  copra, o i l , desiccated  and w h i t e f i b r e .  coconut,  charcoal,  Approximately two-fifth  of nuts are  p r o c e s s e d f o r c o p r a , o i l and d e s i c c a t e d c o c o n u t . total  of  2623 men  production  of  and  women w e r e d i r e c t l y  copra  (other  processing of d e s i c c a t e d increase  i n employment  production dominant nearly  exporters  from  per  of  cent  bristle  coir  of  fibre  on  1971.  the is  The  world supplied  by  both  rural  significant part-time  number  of  workers  on  industrial  India  are  of  the  S r i Lanka  the  which  full-time  and  higher (Marga,  a c t i v i t i e s are  areas a  90 p e r c e n t  located  provide as  well  a as  basis.  Coconut located  semi-urban  the  w o r l d market  supplies  Coconut-related industrial and  and  a  i n the  and  coconut  i n the  1986a:2). in  estates)  S r i Lanka  fibre  I n 1981,  employed  coconut which i s about  i s export-oriented.  80  quality  than  brown  in  cultivated the  lands  "coconut  Gampaha, K u r u n e g a l a  and  and  triangle"  industries of  Puttalam which  the i s one  are  mostly  districts of  the  of most  186  densely  populated  population  density  coconut-related markets  regions  for  not  in  only  industrial  finished  Sri  Lanka.  provided  cheap  activities  products.  The  The  but  higher  labour  also  export  provided  o r i e n t a t i o n of  t h i s s e c t o r a c t i v a t e d the growth of e x p o r t - o r i e n t e d and  s p e c i a l a t t e n t i o n was  p r o d u c t i o n . The a new  export  development of the t o u r i s t  productions  were  The  surplus  shipped  to  p r o c e s s i n g i n e s t a t e s and  production  little  focused  tea  and  the  external  rubber  processes  market.  urban workers.  which  provided  a  processing  the  above,  i n d u s t r i e s (sugar,  wood) which p r o v i d e d industrial (People's The the  there  were fruits,  have  been  had  sector.  In  rubber  has  amount  several  other  vegetables,  promoted  of  indicate.  RNA-related employment.  activities  rubber  which  significant  employment as the r e c e n t p o p u l a t i o n censuses Besides  Tea  However,  remained i n enclaves  r e c e n t y e a r s , however, the p r o c e s s i n g of t e a and locally  on  agricultural  i n t e r a c t i o n w i t h the domestic i n d u s t r i a l  increased  mainly  the manufacture of primary  p r o v i d e d employment f o r e s t a t e and these  industry created  products.  a g r i c u l t u r e i n S r i Lanka  marketing.  products  given by the s t a t e to promote such  demand f o r white f i b r e - r e l a t e d Plantation  in  in  agro-  dairies,  Most of  these  recent  years  Bank, 1986c: 2-19). industrial  agricultural  Sethuraman's  (1983:  s e c t o r i n g e n e r a l was sector Table  e x c l u d i n g Colombo d i s t r i c t ,  except 1)  for  regrouped  poorly linked tea  and  industrial  i n terms of t h e i r  to  rubber. units,  linkages  with  187  a g r i c u l t u r e i n d i c a t e d t h a t the m a j o r i t y of i n d u s t r i a l were not l i n k e d e i t h e r forward 1971  but  l i n k e d to r u r a l  Unlinked  rural  per  of the  cent  district. 1986  or backward to a g r i c u l t u r e i n  household  consumption i n d u s t r i e s .  i n d u s t r i e s together total  industrial  Furthermore,  ILO-ARTEP  Rural  one  comprised  more than  units outside  the  of  the  important  Industries  and  Employment  small-scale  industries. employed  The  a  majority  significant  traditional those  industries  findings  of  Survey  was  and  rural  of  rural  did  between  large-scale  the  number  techniques  i n d u s t r i e s due  of  and  not  to marketing and  heavy  industries labourers  attempt  to  which  adopted modernize  financial constraints  (Marga, 1986b and  ILO-ARTEP, 1987). In a d d i t i o n , i t has  indicated  1983b;  (ILO,  industries  were  faced  ILO-ARTEP, with  50  Colombo  the poor i n t e r - l i n k between the r u r a l i n d u s t r i e s and rural  units  1987)  limited  that  raw  the  been rural  materials,  non-  a v a i l a b i l i t y of c r e d i t and marketing problems i n a d d i t i o n t o t h e i r s t r u c t u r a l weakness and The  poor  resulted  in  absorption  performance a  of  relatively  i n the  rural  locational the  low  areas  disadvantages.  rural  level  industrial  sector  non-farm  labour  of  (see Chapter 4 ) .  This  i s r e f l e c t e d i n the o c c u p a t i o n a l d i s t r i b u t i o n and of  labour.  occupational nearly 1971  90  and  As  Table  5.3  categories  per 1981,  cent  of  only  c o n t r a c t i o n workers and  (2 the  two  shows, digital total  among level)  rural  occupational  No.97, food  trend  absorption  the  sixteen  which  absorbed  employment  between  categories  (No.95,  & beverage producers  as  188  i n T a b l e 5.3)  showed an i n c r e a s e .  categories together total  rural  absorbed  employment  These two o c c u p a t i o n a l  o n l y about  10 p e r cent  increase during  this  period  o f the (Table  5.3). Another important is  the disappearance  chapter  4).  occupations, traditional employees  of r u r a l  Table  blacksmiths occupations  between  disappearance of  As  aspect of the r u r a l employment change  blacksmith,  tool  5.5  indicates,  and  tool  lost a total  1971  of r u r a l  industrial  and  1981.  traditional makers,  employment (see handloom-related  makers  other  o f n e a r l y 45 thousand With  regard  occupations  craft  and  makers  to  the  such  as t h a t  and  service  o c c u p a t i o n s , the major f a c t o r s a r e the i n c r e a s e d c o m p e t i t i o n from rural  imports areas.  and the changing Senanayake  consumer  (1987)  citing  preference from  (1981) i n d i c a t e d t h a t " . . . i n a v i l l a g e i n southern  i n the  Hesselberge province,  s e v e r a l o f the c r a f t s a r e d i s a p p e a r i n g i n the face o f import of mass-produced goods" (1987:15). In r e c e n t y e a r s , however, w h i l e many t r a d i t i o n a l c r a f t s have been d e c l i n i n g , some have achieved  considerable production  i n c r e a s e s due t o i n c r e a s e d  t o u r i s t a r r i v a l s s i n c e 1977 and the r a p i d development o f the tourist industry.  189  5.2.2  S t a t e , I n f r a s t r u c t u r a l Development and t h e Growth o f R u r a l Non-Farm A c t i v i t i e s  According  to  the  available  w h i t e - c o l l a r - r e l a t e d occupations of  employed p o p u l a t i o n  increase) collar  technical cent  areas  35 p e r c e n t  (Table  c l e r i c a l and  occupational  of the t o t a l  of the  total  5 . 2 ) . Among t h e  white  related, professional  categories  increase  information,  a b s o r b e d t h e l a r g e s t number  (more t h a n  i n the rural  occupations,  statistical  a b s o r b e d more t h a n 90 p e r  i n employment  (Table  5.2).  p r o f e s s i o n a l and t e c h n i c a l o c c u p a t i o n a l c a t e g o r y  was  concentrated  social  personnel  (more service  occupational community, storage real  according  and  and  categories  of  service  population  government  employees  occupations  clerical in  service  (27%),  and  and  three  were  heavily and  related sectors  transport,  finance,  insurance,  (8%) - i n t h e r u r a l census.  That  the  rural  created  areas  i s t o say,  workers,  o f f i c i a l s were  in  The  (33%),  administrative  welfare-oriented  white-collar  community,  spread  personnel  and b u s i n e s s  teachers,  in  while  were  communication  t o t h e 1981  officials the  categories  and  90%)  sector  social  estate  school  than  and  found  bank to  areas.  by  the  be  These  state  and  employed i n t h e s t a t e s e c t o r . How  were  occupations the  state  s u c h l a r g e numbers  created to  create  i n the r u r a l such  types  of w h i t e - c o l l a r (non-farm) areas? of  What  occupation?  factors led To  answer  190  these Sri  q u e s t i o n s , we should  Lanka  from  inherited  the  a well-developed  British  administrative  remember f i r s t  colonial  capital  city  independent  a d m i n i s t r a t i v e system  rulers  with  that  which  the r e s t  linked  the  of the c o u n t r y .  A f t e r independence, the o b j e c t i v e of d e v e l o p i n g the domestic agricultural  sector  led  the  state  to  establish  i n f r a s t r u c t u r e which would c o o r d i n a t e the development domestic tanks  an of a  a g r i c u l t u r e s e c t o r . Roads, houses, dams were b u i l t ;  and  anicuts  were  renovated;  t r a n s p o r t a t i o n and  communications were l i n k e d w i t h the a g r i c u l t u r a l areas and a number  of administrative units  agricultural  development,  which  e.g.,  were  related  agricultural  t o the  extension  s e r v i c e s were e s t a b l i s h e d i n the r u r a l a r e a s . As a r e s u l t o f these  attempts,  those  areas. While  rural  trying  people,  attempted  more government  t o promote  the  t o upgrade  employment  the l i v i n g  post-independence the s o c i a l  was c r e a t e d i n  standard governments  aspects  of r u r a l  E d u c a t i o n and h e a l t h were g i v e n g r e a t e r a t t e n t i o n . were e s t a b l i s h e d even teaching-related  i n remote  administrative  rural  areas;  officials  of the also life. Schools  t e a c h e r s and  were  appointed.  Free e d u c a t i o n was made a v a i l a b l e f o r c h i l d r e n r e g a r d l e s s o f sex,  and c a s t e .  children.  Health  Education facilities  was  made  were  compulsory  promoted  f o r young  in a  manner. The h e a l t h s e c t o r too p r o v i d e d a s i g n i f i c a n t of jobs f o r the r u r a l p o p u l a t i o n .  similar number  191  The  r a p i d l y expanding  government  sector  i n the  rural  a r e a s n e c e s s i t a t e d an a d m i n i s t r a t i v e u n i t t o c o o r d i n a t e supervise  t h e development  activities was  at the rural  abolished  and  other were  new  time,  a  (Perera  number  institutions societies  The c o l o n i a l Grama  other  state  headmen  system  Sevaka  administrative  i n w h i c h a Grama S e v a k a a n d a number o f  agriculture, rural appointed  a g r i c u l t u r e and  level.  the  d i v i s i o n was c r e a t e d  of  and  and Fernando,  of  such  development  semi  as  and  and  health  1980).  A t t h e same  non-governmental  co-operatives,  rural  and t h e l i k e were e s t a b l i s h e d .  semi and non-governmental r u r a l  officials  rural  development  These  government,  i n s t i t u t i o n s provided  rural  non-farm employment. The  total  increasing  employment  rapidly  indicated the total  since  i n the state  sector  independence.  As  has  been  Table  5.8  e m p l o y e d i n p u b l i c s e c t o r h a s r i s e n more  t h a n 100 p e r c e n t w i t h i n 10 y e a r s  b e t w e e n 1948 a n d 1958. The  total  has  number  faster rate. and  other  earlier  of state  employees  of this  chapter.  found i n t h e r u r a l areas the were  1981 c e n s u s directly  834,217  categories  were  Combining  was  Most o f t h i s  (see Table 5.3).  of population,  employed  employed  employees.  a t an  The r a p i d g r o w t h o f t e a c h e r s , m e d i c a l  related occupational  part  increased  i n the  a  total  state  categorized both  these  officers  shown i n t h e  employment According  o f 519,967 sector  even  and  was to  people another  as  semi-government  two  categories  g o v e r n m e n t e m p l o y e e s , more t h a n t h r e e - q u a r t e r s  of  of the t o t a l  192 Table 5.8: The Expansion of S t a t e Sector A c t i v i t i e s and Growth i n Employment, S e l e c t e d Years. 1948  1958/59  1970  1975  1981  NA  28  62  107  NA  109854  222664  NA  NA  519967  No. of P u b l i c Corporations No. of Employed Public Sector 'NA' Not a v a i l a b l e  Note. Employment F i g u r e s f o r 1981 i n c l u d e Government Employee Only and Semi-Government Employee Category which i n c l u d e s 834217 persons i n 1981 i s not i n c l u d e d i n t h i s table. Source: F i g u r e s f o r 1948, 1958/59, 1970 and 1975 L e i t a n , 1979:27-30. The F i g u r e s f o r 1981 a r e Department of Census and S t a t i s t i c s , 1986c.  employees  are  distributed  found  i n the  rural  i n agriculture sector  (about  related  occupation  clerical  (25%) o c c u p a t i o n a l c a t e g o r i e s .  Apart creation,  from  (20%)  areas  the  professional  above  t h e r e were t h r e e  types other  of  and  are  mainly  45%), p r o d u c t i o n and  technical  non-farm  areas  a r e from from t h e  and  employment  where the s t a t e was  a b l e t o c r e a t e a c o n s i d e r a b l e amount of non-farm employment and  income  established handicraft  for  work  people.  a number of r u r a l and  workers. programmes  rural  provided  Secondly, gave  i n the  industries,  direct the  First,  employment  government's  farmers  and  landless  renovation  and  repair  of  the  government  e.g., handlooms, f o r the drought  labourers village  rural relief  part-time tanks  and  193  anicuts  during  the  drought  state's  anti-poverty  and  programs  off-seasons. (see  Finally,  Chapter  4)  the  provided  s i g n i f i c a n t p r o p o r t i o n of non-farm income to the r u r a l who  were c o n s i d e r e d  to be below p o v e r t y  level  a  poor  according  to  exceptional role  of  the government's d e f i n i t i o n of poverty. There are  two  questions  about the  the s t a t e i n employment c r e a t i o n and r u r a l development which need  to  be  analysed  independence  governments  development engage  in  general  further.  activities such  answer  First,  why  concentrate  and  how  did  on  the  such  the  state  massive  rural  development  to  first  question  the  did  post-  types  of  manage  to  programmes?  is  the  A  electoral  i n t e r e s t of the post-independence governments. The  electoral  aspects  of  discussed  from  number  a  region,  post-independence  elite  of  have  e.g.,  interest  viewpoints,  group and  ethnic p o l i t i c s ,  politics  been of  the  urban b o u r g e o i s i e , Moore,  Ponnambalam,  (1983).  More than  of the t o t a l e l i g i b l e v o t e r s i n S r i Lanka l i v e  (1985a);  two-thirds  i n the  areas and t h e i r p o l i t i c a l p a r t i c i p a t i o n i s higher and compared t o s e v e r a l other d e v e l o p i n g c o u n t r i e s . of t h i s ,  core  rural active  As a r e s u l t  the post-independence development plans  inevitably  gave g r e a t e r a t t e n t i o n to t h i s area and the people who  could  make the p o l i t i c a l c h o i c e s . There were a number of sources  i n which the s t a t e s were  a b l e t o a t t r a c t the needed investment Most  of  banking  the  major  activities,  industries, power  over  generation  and c r e a t e employment. 80 and  per  cent  of  the  distribution  and  194  c o n s t r u c t i o n works are f i n a n c e d the  available  were  i n f o r m a t i o n , a t o t a l of 1.1 m i l l i o n  employed  governmental Bank,  in  government  institutions  1979:  Table  by  departments  December  1). A c c o r d i n g  population,  the s a l a r i e d  more  90  than  by the s t a t e . A c c o r d i n g  per  to  government  cent  of  white  31, the  and  employees  and  1978  semi-  (People's  1981  employees  to  census  of  consisted  of  semi-white-collar  o c c u p a t i o n s and 25 per cent of the r u r a l employed  population  at t h a t time. It  i s important  at t h i s  point  t o e v a l u a t e whether  the  s t a t e - o r i e n t e d r u r a l development p o l i c i e s helped t o a c t i v a t e a  dynamic  growth  in  agricultural-related With  regards  welfare,  to  characteristics First, literacy  the  and  development  areas  are of RNA  the  non-farm  non-farm growth was  t h r e e major  electrification-  rural  of  - education,  taken  here  for  activities. discussed  green  earlier.  infrastructure transportation analysis  of  and and the  growth.  achievements  education  level)  in  education  (increasing  in  the  areas  rural  undoubtedly c o n t r i b u t e d t o t h i s development. the  The  revolution  and  the  increasing  have  The success of skilled  and  managerial employment i n the r u r a l areas i n d i c a t e the impact of  i n c r e a s i n g education.  r u r a l development was  However, t h e i r c o n t r i b u t i o n t o the  not s u f f i c i e n t f o r a r a p i d RNA  f o r the f o l l o w i n g reasons.  growth  The e d u c a t i o n a l system which was  i n h e r i t e d from the c o l o n i a l masters d i d not aim a t p r o v i d i n g skills  and  training  in  clerical-related  occupations.  195  Isenman has  (1980)  indicated  the  c u r r i c u l u m of  education  b e e n f o c u s e d on t h e a c a d e m i c n e e d s o f t h e s m a l l m i n o r i t y  going  beyond  the  secondary  development-oriented out b e f o r e The  skills  hand,  related) large  the  l e a r n i n g n e e d s o f t h e m a j o r i t y who  drop  needed  economy  made s u c h  occupations  number  sector.  of  rather  for  the  system  rapid  than  prestigious types other  The  and  secure  by  occupations  factors  young l a b o u r f o r c e from  teach of  an  on  the  teaching-  absorbing  in  worked  production-related occupations  to  state,  (clerical  and  of  failed  development  S r i Lanka.  white-collar  and  s e p a r a t i o n of r u r a l  education  like  those  Those  the  level,  then.  underdeveloped other  on  post-independence  technical  and  that  the  state  towards  the  i n the  the  agriculture rural  areas.  Such d i f f e r e n t e x p e c t a t i o n s of educated  youth only helped  c r e a t e more u n e m p l o y m e n t . The  youth  the  richer  rural  households  educated  made t h e i r way  who  The  rural  t r a n s p o r t a t i o n and  o t h e r h a n d , had employment  a  significant  growth.  The  (Ceylon  Transport  Board  provided  regular  service  areas w i t h the r e s t 1978,  more  signifies All  these,  than  the  rural  on  the  connected  government most  of  increasing  motor use  helped  cars  were  of automobile the  mobility  of  the  non-farm sector railway  the  rural  of the country. W i t h i n three years  35,000  in fact,  the  as  areas.  transport service  "CTB") and and  on  to  from  towns  electrification,  impact  government  were  to the  t h e d e s t i n a t i o n of o u t - m i g r a t i o n from t h e r u r a l  a  from  imported  which  i n recent  years.  labour  and  the  196  transportation between  the  o f goods rural  transportation the is  and  i s noted  and s e r v i c e s w i t h i n  the rural  urban  an  areas.  Such  rural  impact  i n the increasing  The i n d i r e c t  sectoral  impact  integration of the  economy. The  importance of r u r a l  significantly manner.  e l e c t r i f i c a t i o n which  i n recent years  However,  increased  a l s o c o u l d b e s e e n i n t h e same  t h e development  was b i a s e d t o w a r d s some a r e a s ,  of r u r a l  electrification  c o n s t i t u e n c i e s which  returned  members o f t h e r u l i n g p a r t y , a n d m o s t o f t h e i n c r e a s e d electrification areas  was  (Gunatilake, On  the  f o r household  consumption  the  development  beneficiaries were,  1980: 2 - 3 ) .  fact,  latter  traditional  two  categories  non-farm  blacksmiths  and  tool  improvement  of  transportation  positive rural  rural  peasants,  (Swan, 1 9 8 3 ;  i n the educational rural  neither d i d e l e c t r i f i c a t i o n nor transportation. the  electrified  rich  impact on t h e p o o r  development d i s p l a c e d t h e poor r u r a l their  the  supporters  The d e v e l o p m e n t  l e v e l d i d n o t make a n y s i g n i f i c a n t households;  i n the rural  of  i n fact,  t r a d e r s and t h e government p o l i t i c a l Gunatilake  rural  1980: 3 ) .  whole,  infrastructural  In  of  i n t h e employment o p p o r t u n i t i e s i n  transportation-related activities. evident  and  makers,  mechanization  aspects  of  t o urban migration  infrastructural  labourers  and  destroyed  establishments Table on  on t h e o t h e r  the rural  of  5.5) the  development  o f an a d v e r s e  through  one  hand.  (e.g., the  hand  and  However,  some  prevented  any  kind which  occurred  197  in  many  developing  population  countries  increase  and  as  the  result  modernization  of  and  the  rural  mechanization  which accompanied the green r e v o l u t i o n .  5.2.3  Urban F a c t o r s i n the Growth of Non-Farm A c t i v i t i e s  The i n f l u e n c e of the urban market on the growth of is  a well  documented  aspect  i n the employment  literature.  The e n t e r p r i s e s l o c a t e d i n the urban c e n t r e s e i t h e r non-farm promoted  employment  for  the  migrant  i n the r u r a l  contributed  areas  strong  t o employment  a  either  promote o r discourage  urban  impact  on  3.19  million  population.  which  Urban  was  the  rural  (officially  21.5  growth was  per  income  not very  growth  economy  of  i n 1981  the  significant  components.  Migration.  Urbanization  cent  to  As  the  and  ESCAP  Development  (1980) in  the i n - m i g r a t i o n has c o n t r i b u t e d l e s s the  total  p e r i o d 1948 t o 1971.  urban  population  total during  the p r o p o r t i o n of  has shown a d e c l i n e . Urban  industrial  could  indirectly .  functions  S r i Lanka are mostly a d m i n i s t r a t i v e and have very  indicates,  or  At the same  defined)  cent  f o u r decades and i n r e c e n t years  t o t a l urban p o p u l a t i o n in  and  the growth of RNA  The t o t a l urban p o p u l a t i o n  last  workers  or through c r e a t i n g markets.  time,  the  provided  the RNA-related a c t i v i t i e s through s u b - c o n t r a c t i n g  which d i r e c t l y  was  rural  RNA  increase  little  study Sri  on  Lanka  than 10 per during  the  198  The of  p r i m a t e c i t y o f Colombo c o m p r i s e s a b o u t  the  total  urban  shows t h e u n e v e n  population  urban  Marga s t u d y (1981b) city  has  distribution  indicates,  been e x p e r i e n c i n g  a d d i t i o n , Colombo c i t y ' s absorbing  capacity  and s t a t e  policies.  The  urban to  transferring  goods  urban  enterprises  number  of  rural  t h a t about regularly Similar  Lanka  of  residents.  Such  of  the  For  patterns  of  employment  In  market  some  extent  development  transfer,  for  example,  neighboring rural  Colombo  employment  domestic  employment  the  export  to  rural  45 p e r c e n t o f t h o s e who from  towns as  Sri  growth  provided  As  situation.  p e r f o r m a n c e and  services.  the  labour  d e t e r m i n e d by  growth  and  stimulated  in  which  i n S r i Lanka.  a surplus  largely  the  i n 1981  t h e u r b a n economy o f  economic  markets  contributed  earlier,  was  i n S r i Lanka  60 p e r c e n t  a  as  by noted  sector  and  significant  i t is  indicated  w o r k i n C o l o m b o commute  areas could  (ESCAP, be  1980:  seen  in  87). smaller  well.  However,  of  the  u r b a n economy, t h e u r b a n e n t e r p r i s e s c o u l d n o t s t i m u l a t e  the  growth  of  the  urban  did  not  either. an  RNA  to  the  f o r the  economy w h i c h  provide  weakness  following  slow  areas;  demand  few  the  urban  and  structure  industrial  activities  f o r consumer  instead,  growth  r e a s o n s . The  contains  sub-contracting  and  A t t h e same t i m e , t h e u r b a n m a r k e t  effective  rural  due  to  components rural  d i d not  areas provide  other products  enterprises  of  benefited  from by  199  sending  goods,  urban produced and imported,  w h i t e - c o l l a r o c c u p a t i o n s , t o the r u r a l  and  services,  area.  5.2.4 P o p u l a t i o n F a c t o r s and the Growth o f RNA  It  was  population 1960s  indicated  earlier  i n S r i Lanka was  (Chapter  4) t h a t  growing r a p i d l y  the t o t a l  i n 1950s and  due t o the d e c l i n e of m o r t a l i t y r a t e s . The  decline  of  resulted  the b i r t h  rate  i n significant  began  changes  i n early  gradual  1970s  which  i n age d i s t r i b u t i o n .  The  baby boom c h i l d r e n of the 1950s and 1960s entered the l a b o u r market i n 1970s. For example, the age group 15-29 was 25 p e r cent of the t o t a l  p o p u l a t i o n i n 1963 but i n 1971 and 1981,  the percentage c o n t r i b u t i o n of t h i s age group has i n c r e a s e d to  28.4 and 29.6 r e s p e c t i v e l y  (ESCAP,  1976). As a  result,  the l a b o u r f o r c e p o p u l a t i o n (15-59) grew a t the r a t e of 4.2 per  annum  i n 1971 as opposed  t o around two per cent p e r  annum i n 1950 and 1960. The  overall  labour  i n c r e a s i n g unemployment, of  productive  situations income  groups  employment.  of  (1982)  rural  situation  However,  the  1970s  labour  v a r i e d between  households.  indicated,  As  employment  of a household d e c i s i o n making. parents  in  was  under-employment and u n a v a i l a b i l i t y  characteristically  Pinnaduwage result  market  market  the d i f f e r e n t Morrison  and  i s largely  the  They say (1982) ".  i n the households who p l a n the s t r a t e g i e s and  make the c h o i c e s . Yet i n each community  there  i s a context  200  w i t h i n which these the  level  of  c h o i c e s a r e made. resources  localities"(1982:  opportunities  in  the  21). Such employment c h o i c e s and d e c i s i o n  making s i g n i f i c a n t l y the r u r a l  and  E v e r y t h i n g depends on  vary  among d i f f e r e n t  income groups o f  households.  For purpose o f our study, categorized  into  two:  lower  the r u r a l and upper.  number o f p o p u l a t i o n and f e r t i l i t y Jayawardene,  1967  and  income groups a r e  World  In f a c t ,  studies  as the  (Abhayaratne and  Fertility  Survey,  1978)  i n d i c a t e s the p o p u l a t i o n growth i n the 1950s and 1960s was relatively  higher  among  the lower  income  groups  household compared t o o t h e r s . The h i g h e r f e r t i l i t y lower  income  literacy,  group  was  e t c . (World  associated Fertility  with  1978).  the l a b o u r  f o r c e growth c o u l d be expected  among t h i s  group. In f a c t , however, the labour  different  from  that  of other  income households e n t e r e d age  and  their  Tilakeratne  overall  among the and  Therefore,  t o be a l s o  higher  f o r c e growth  households was q u i t e  groups. The members  of lower  i n t o the labour market a t an e a r l y working  time  (1977) i n d i c a t e d , c h i l d  these poor households.  rural  low e d u c a t i o n  Survey,  mechanism among the lower income r u r a l  of  Likewise,  was  labour  also  high.  As  i s common among  female work p a r t i c i p a t i o n  was a l s o h i g h . The r a p i d i n c r e a s e i n labour f o r c e p o p u l a t i o n in  the  lower  income  increased  the  categories  (e.g.,  rural  category labour  undoubtedly in  manual and labour  selected type  would  have  occupational  occupation).  In  f a c t , as Wickramasekara (1977) i n d i c a t e d , the development of  201  the  domestic  agriculture sector  for  ' h i r e d labour'  group was a b l e  i n rural  i n 1950s c r e a t e d  a demand  areas i n which the lower income  t o get employment. However, such a s i t u a t i o n  changed i n 1970s due t o the r e l a t i v e d e c l i n e of a g r i c u l t u r e employment and t o s u r p l u s The  labour  labour  i n the r u r a l  s i t u a t i o n i n the middle  group was d i f f e r e n t from the previous segment with  of young  the r a p i d l y  rural  areas.  progression out in  people  increased  as  education and  income  The l a r g e associated  facilities  i n the  rates  income l e v e l s ,  and  the drop-  among low-income f a m i l i e s  (Wickramasekara,  1986).  As a  result,  f o r these income groups means s a l a r i e d employment  social  mobility.  i n d i c a t e d t h a t ". . tend  was  the enrollment  are l i n k e d with  sector  situation.  educational  r a t e i s g e n e r a l l y much higher the r u r a l  and upper  i n the p o p u l a t i o n  F o r example,  rates  areas.  t o be more  In  this  regard,  . P u b l i c - o r formal  secure  and t o o f f e r  prospects;  such jobs a r e worth w a i t i n g  relatively  educated  'reservation  wage'.  young people They  Isenman  private-sector much  for.  better  to  jobs  career  In other words,  i n S r i Lanka  tend  (1980)  choose  have a to  high  remain  ( ' v o l u n t a r i l y ' ) unemployed i n l a r g e p a r t because, from t h e i r p o i n t o f view, i t i s f i n a n c i a l l y p r o f i t a b l e i n the long run t o do s o " . Moore and Wickramasinghe (1980) t o o found i n a v i l l a g e level  study  educated either  that  the parents  unemployed  youth  were prepared  until  i n the government s e c t o r  they  t o support the  found  or equivalent  a  "good" j o b white-collar  2 0 2  occupation.  Therefore,  the increasing open  unemployment  among the middle and upper r u r a l groups was l a r g e l y due to the  lack  of white-collar employment  and p a r t l y  due to  attitudes about other 'less prestigious' r u r a l employment. Therefore, mechanism  as  the above  i n which  labour  discussion  type  and  indicates,  the  government-related  occupations emerged were d i f f e r e n t i n the r u r a l areas.  5.4  Discussion  In the previous sections of t h i s chapter, three major research questions with regards to the growth of r u r a l nonfarm a c t i v i t i e s i n S r i Lanka were considered: a)  has R N A s i g n i f i c a n t l y increased?  b)  has the o v e r a l l quality of labour increased among the R N A workers?  c)  what factors l e d to such growth of  R N A ?  Our findings are the following: significant  i n absolute  decades e s p e c i a l l y  after  during  period  the study  numbers 1970. was  only  The R N A  growth was  during  the recent  the R N A  Secondly,  confined  to two  growth  areas  of  occupational categories: the low productive occupations and salaried and  government employment.  quantitative and  The R N A  qualitative  growth mechanism  aspects  of  "polarized" categories' employment growth d i f f e r .  these  two  The low  productive occupations increased i n numbers (volume) but the extent  of i t s numerical  significance  i s not known at the  203  national as  a  l e v e l due  number  1977  and  RNA  was  of  to the  micro-level  Crooks and much  unavailability case  studies  Ranbanda, 1981)  higher  than  of data.  However,  (Wickramasekara,  i n d i c a t e , the growth of  reported  in  s t a t i s t i c s . F u r t h e r , the labour type RNA  the  macro-level  growth was  confined  to the lower income group of the r u r a l households among whom labour s u r p l u s and under-employment were common. The s i t u a t i o n i n t h i s income group was population  and  labour i n the  participation  compared  same  time,  absorb  the  the  cheap  this situation. growth model  form  weak  of  to  labour  2)  (supply determined RNA  e x p l a i n s the  occupations  was  result  associated with  neither  the o v e r a l l of  rapid  stage, i t was labour  force  for RNA  factors i n the  the  growth  from the  of  rural  state policy  occupations and  type  economic  improvement i n the economy.  as  of  supply  the  In was  impact  of e l e c t o r a l p o l i c i e s i n post-independence S r i Lanka. At initial  to  scheme of  emergence of such  government-related  "welfarism"  the  able  population  different  was  growth  at  not  significant  of  the  But  growth.  The  fact,  female work  responsible  as the conceptual  growth s i t u a t i o n .  development nor  was  largely  determined RNA occupation  and  labour  growth f a c t o r s ) were s t r o n g e r  mechanism t h a t  government-related  higher  groups.  which  p r e d i c t e d , the  emergence of l a b o u r type RNA The  income  also  also  labour  economy  was  Therefore,  and  child  other  rural  (Chapter  a s s o c i a t e d with the r a p i d  f o r c e growth  participation  surplus  the  the p o p u l a t i o n f a c t o r which l e d t o the growth.  The  situation  created  by  this  204  mechanism was  open unemployment  The employment problems strata the  of r u r a l  state  electoral its  order  to  their  political  r e s o u r c e s and  create  unemployed  more  youth.  activism  employment  growth  expanded  was  the  and  a mechanism  important  i s found  state  absorb  of  Instead, i t was which  upper by in  T h e r e f o r e , the s t a t e used  employment  Such  demand determined.  youth.  were g i v e n g r e a t e r a t t e n t i o n  revolutionary p o l i t i c s .  available  educated  of the youth of the middle and  households  since  among the  RNA  sector  many  growth  a kind  in  of  the  was  not  of m a n i p u l a t i v e  i n post-independence  Sri  Lanka and i n many o t h e r LDCs. However, such c o n c l u s i o n s need t o be c l a r i f i e d The  atmosphere  growth of RNA  for rapid  numerical as w e l l  i n S r i Lanka e x i s t s .  was  r e l a t i v e l y well  qualitative  F i r s t , unlike i n several  o t h e r d e v e l o p i n g c o u n t r i e s , the growing Lanka  as  further.  educated.  labour force i n S r i  Secondly,  a  relatively  w e l l developed i n f r a s t r u c t u r e p o s i t i o n e d r u r a l S r i Lanka f o r an  integrated  Thirdly, unique  the in  development of  development  S r i Lankan developing  policies  the n a t i o n a l  f o u r decades. for  rural  wealth  goods  of  countries  did transfer  Finally,  RNA-related  model  along  and  rural and  RNA  growth.  development such  rural  a significant  t o the r u r a l t h e r e has  with  bias  proportion  areas d u r i n g the  been a s i g n i f i c a n t  services  from  was  the  last  demand  domestic  a g r i c u l t u r e s e c t o r and from r u r a l consumers. However, further  in  spite  significant  of  growth  this in  atmosphere RNA  in  Sri  there  was  Lanka.  no As  205  discussed The  earlier,  this  factor  i s the  first  economy  and  the  weakness was  lack  was  of  due  poor any  sectoral  third  factor  p o l i c i e s during at  such  and  1980;  benefits  which would  is  change.  to future  overall  The  second  the  development.  concentration  on e l e c t o r a l f a c t o r s .  the  welfare  electorate. were  Wickramasekara,  t o the  of  The  post-  government  The  distributed 1986)  "targeted"  benefits to  instead  goals of  everybody  of  providing  (under p r i v i l e g e d )  groups  have made the s i t u a t i o n f a r more d e s i r a b l e f o r  development. the  the  t h i s p e r i o d were mainly f o r short-term  satisfying  development (Isenman,  of  factors.  the l a c k of f o r e s i g h t of the post-independence  independence p o l i t i c s  aimed  following  performance  development p o l i c i e s with regard The  t o the  analysis  Wickramasekara  (1985) i n d i c a t e d t h a t  of a n t i - p o v