Off-farm Employment and Food Insecurity During Rising Food Prices

Many countries experienced record-high food inflation in recent years, which often has negative implications for food insecurity. Off-farm employment is a useful strategy to mitigate food insecurity; however, the role of off-farm employment in buffering against food insecurity triggered by food price shocks remains an important empirical question. This study investigates how food price shocks influence the relationship between off-farm employment and food insecurity in Nigeria, which experienced particularly high inflation in 2024. Based on data from 3,025 rural households collected in 2018/2019 and 2023/2024, we use panel fixed effects regression models and a control function approach. Our main finding suggests that an increase in food price significantly worsens food insecurity, and that there is a complex relationship between off-farm employment and food insecurity. Furthermore, at high food prices, off-farm employment does not have any significant association with food insecurity. Exploring potential underlying mechanisms, we find that food purchase explains the relationship between off-farm employment and food insecurity at high food prices. In addition, household food purchases and total household income further clarify the complex relationship between off-farm employment and food insecurity. Our analyses suggest the need for external support to ensure food security for rural households amid rising food prices.