Livelihood Diversification Strategies by Farm Households in Southern Ethiopia

The Livelihood Diversification Strategies are one of the sources of income-generating activities in Rural Development. The farmers should not solely depend on agriculture but must be encouraged to engage in Off-farm and Non-farm activities, which are allied agricultural activities. The thorough research was conducted in Boloso Sore District in Southern Ethiopia. The major objectives of this study were to identify the existing livelihood strategies adopted by rural households and assess factors that determine households’ decision to choose alternative livelihood strategies. For this study, primary data were collected from randomly selected 149 households. Due to severe land scarcity, high population pressure, and recurrent drought, farm households in the study area widely engage in and pursue diverse, productive economic activities as livelihood strategies. The carrying capacity of agriculture to attain food and livelihood security is extremely declining from time to time. Diversifying livelihood strategies at the current time has become a common phenomenon in the study area. Descriptive statistics were applied to characterize the sample households’ socioeconomic, demographic and institutional factors. The multinomial logistic regression model was applied to identify the factors determining the choices of rural household livelihood strategies on 15 explanatory variables. The rural households in the study area pursued different livelihood strategies such as on-farm alone, 63 (42.3%); on-farm + non-farm, 55 (36.9%); on-farm+ off-farm, 20 (13.4%); and on-farm+ non-farm + off-farm livelihood strategies, 11(7.4%). On-farm livelihood played a leading role by contributing 72% of the total income of the households, whereas Non-farm and Off-farm activities contributed 20% and 8% of the household incomes, respectively. A total of 15 explanatory variables were included in the empirical model, of which 11 were significant. These variables include age, livestock ownership, market proximity, training, total household income, credit use, dependency ratio, Landholding, number of oxen owned, Sex, and cooperative membership, which determines the significant choice of livelihood strategies. This study suggests that development interventions, policies, and supportive services should be designed to suit different groups of farmers' felt needs and circumstances.