Agric remains major source of income

AGRICULTURE remains the largest source of income for the majority of Zimbabweans despite the rising cost of farming inputs and bad weather, among other factors, according to results of a new survey by the Zimbabwe National Statistics Agency (ZimStat).

Traditionally, agriculture is the bedrock of household incomes, but last year, it witnessed a marginal decline, which, however, was tempered by timely interventions by the Government through State-funded schemes.

The ZimStat report also revealed that wage employment had emerged as another growing source of income for Zimbabweans, indicating traction that was recorded in some sectors of the economy such as manufacturing and the growing services industry.

The 10th round of the Rapid Poverty Income Consumption and Expenditure Survey (PICES), conducted by ZimStat in August 2023, showed that farming remained a dominant source of income despite dropping to 29 percent from 39 percent of households that depend on the sector.

Conversely, wage employment has seen a 7-percentage point increase, rising from 15 percent to 22 percent of households relying on it, the ZimStat report reveals.

The trend suggests a multifaceted transformation in the economy, potentially influenced by factors like evolving job markets, climate shifts and the rural-urban migration.

Farming sustains millions across Zimbabwe, and the study showed that over 11 percent of households surveyed cited an increase in the price of farming and business inputs as the greatest challenge that needs urgent solution.

While the survey does not give a breakdown of the farming and business input costs, experts say fertilisers, seeds and equipment are likely the reason behind the rising costs of farming.

In some cases, this makes farming less financially viable for many households, particularly small-scale farmers who already operate on tight margins, but Government interventions usually come in handy to provide a soft landing.

Unpredictable weather patterns of late have been further compounding the situation.

Although the report revealed a marginal decline in the number of households relying on farming, some observers contend that Government interventions have prevented an even significant decline of the sector.

“While challenges remain, Government interventions seem to have softened the blow for many farmers, preventing a mass exodus from the agriculture sector,” said Mr Tobias Musara, a development studies senior lecturer with a local university.

Among notable State-assisted farming programmes are the Pfumvudza/Intwasa programme, which has witnessed a significant rise in land preparation between 2021 and 2023, and the Presidential Free Cotton Inputs Scheme.

By November 2023, nearly 12 million plots covering 744 588 hectares (ha) had been prepared, more than doubling the previous year’s figure of 5,87 million plots, (366 706ha), and nearly tripling the land prepared in 2021 of 4,6 million plots (287,640ha).

The programme targets staple crops such as maize and traditional grains.

On the other hand, the free cotton inputs scheme launched a decade ago, provides free seeds, fertilisers and chemicals to thousands of households to boost cotton production.

In response to the growing number of people seeking wage employment, analysts suggest the expansion of informal and formal enterprises could be a contributing factor.

“The rise of small clothing, grocery, electronic shops, home-based businesses and to a lesser extent formal business in selected sectors of the economy is creating new opportunities for employment,” economic analyst Mr Carlos Tadya said.

Beyond farming and wages, other income sources showed mixed results.

Incomes from non-farm enterprises saw a positive trend, rising from 10 percent to 13 percent, suggesting its increasingly important role in household income generation.

Intra-family support remained relatively stable, with a slight increase from 12 percent to 13 percent, highlighting the enduring value of familial networks, the study shows.

With regard to retirement savings, an uptick from 3 percent to 4 percent might indicate slight growth in pension coverage or payouts, some analysts suggest.

Government assistance held steady at 5 percent while formal remittances dropped from 9 percent to 5 percent, potentially reflecting economic challenges in remittance-sending countries.

Informal remittances emerged as a new source, contributing 3 percent, possibly due to changes in migration patterns or informal transfer methods.

While the survey shows the prevalence of different income sources, it does not mean households solely rely on one source for survival. Some have diverse income streams.

Understanding living conditions in Zimbabwe is crucial for crafting effective policies.

To address this need, ZimStat, with support from the World Bank and UNICEF, conducts the Rapid PICES. Of the 1 800 households selected, 1 040 participated, representing a 57,8 percent response rate.