Research on the Impact of Homestead Withdrawal on Rural Residents’ Well-Being—An Analysis of the Mediating Effect of Non-Agricultural Employment

Homestead withdrawal is a key component of China’s rural land-system reform and plays a vital role in unlocking rural land assets, advancing farmers’ common prosperity, and implementing the rural revitalization strategy. Existing studies have mostly focused on the improvement of land use efficiency or the single income effect of rural residential land withdrawal, while they have paid insufficient attention to the transmission logic of how the policy affects residents’ comprehensive well-being through employment transformation, and have rarely conducted a systematic investigation from the perspective of “economic-health-social-psychological” multi-dimensional well-being. Drawing on survey data from 405 farm households in a western county of Shandong Province and employing propensity score matching (PSM), this study examines the impact of homestead exit on rural residents’ well-being. A mediation-effect model was then used to explore the underlying transmission channel, with a particular focus on off-farm employment. The results show that homestead withdrawal exerts a significant positive effect on rural well-being and that off-farm employment partially mediates this relationship. Accordingly, we recommend optimizing compensation schemes by combining multiple compensation instruments, establishing a long-term oversight mechanism for compensation funds, and launching targeted vocational training programs tailored to villagers’ employment intentions and skill needs. Complementary measures should include strengthening the rural social-security system and building a coordinated policy framework to further raise rural residents’ well-being.