Growth of urban farm employment in Tamil Nadu

Purpose - The purpose of this paper is to examine the structure of employment in the most urbanized state in India during the period 1983-2010. The paper also analyses the determinants of growth of farm employment in urban areas in the state of Tamil Nadu. Design/methodology/approach - The paper compares trends in employment in Tamil Nadu with that of the country as a whole. In order to see whether there is evidence of Lewisian labor transfer, the study examines labor transfer between sectors and percentage distribution of workers in the rural and urban areas. Findings - The paper finds that employment in the entire non-agricultural sector slowed down in 2009-2010 compared to 2004-05 in Tamil Nadu. The share of employment in primary sector in urban areas increased more sharply, experiencing slow economic transformation in the post-reform years. The analysis reveals that rapid rural-urban transformation could be one reason for more people in the primary sector in urban areas. Research limitations/implications - Studying the employment structure at the district level, for which analyzing the district-level data collected and published by state’s Bureau of Economics and Statistics is required, would be helpful to discern a deeper influence of urbanization on structure of employment. Practical implications - The results suggest that the issue needs further examination with analysis of the district-level data. Policy reforms should, therefore, be suitably oriented toward tapping the employment potential of both unorganized and organized segments in manufacturing, trade and services sectors. It is also necessary to ensure robust economic growth that creates decent jobs for all young educated people in the state. Originality/value - The study explains the domination of farm employment in urban Tamil Nadu. Tamil Nadu is considered to be the most urbanized state in India. The reason for an increase in the share of primary sector employment in urban areas of Tamil Nadu is due to high urbanization in the post-reform periods.