Subsistence farming tops local sources of income

At least 43 per cent of the households in Uganda reported subsistence farming as their major source of income, the 2016/17 household survey has shown.

The Uganda Bureau of Statistics (Ubos) survey also found that one in every four households (25 per cent) said wage employment was their main source of income.

Meanwhile, one in every five households (20 per cent) said their income was in non-agricultural enterprises.

“Household income is the most important determinant of economic well-being and provides a measure of the resources available to the household for consumption and saving,” said Ubos.

At least 17,450 households countrywide were surveyed for the study. There are about seven million households in Uganda, each with an average of seven persons.

While it was noted that some families depend on receiving remittances from their relatives in urban areas or abroad, female-headed households were more likely to have remittances as their main source of income (18 per cent) compared to male-headed households (two per cent).

In rural areas, crop farming was the main source of earnings for half of the households (52 per cent), followed by wage employment (20 per cent).

In urban areas it was wage employment (41 per cent) followed by non-agricultural enterprises (31 per cent). Sources of income have a major impact on poverty levels, with those whose main source falls into the agricultural side likely to be poorer than those in employment and non-agricultural enterprises.

Kampala sub-region, which is one of the better-off ones, had the highest percentage of households whose main source of income was wage employment (49 per cent). Only one per cent of households in Kampala reported crop farming as their source of income.

Teso sub-region, among the poorest, had the lowest (32 per cent) households in wage employment. Teso had the highest percentage of households that had crop farming as their main source of earnings (63 per cent).

Overall, the average monthly cash income for Ugandans in 2016/17 was Shs 416,000. The average monthly income in urban areas – at Shs 703,000 – was more than twice the average monthly income in rural areas at Shs 303,000.
Kampala had the highest average monthly income, Shs 938,000, followed by Central I at Shs 569,000.

Bukedi sub-region is the poorest with an average income at Shs 141,000 per month.

“Irrespective of background characteristics, the average nominal incomes in 2016/17 were generally higher compared to 2012/13,” says Ubos.

HOW OFTEN

The respondents were also asked how often they earned the money from their main sources of income. Sixty-seven per cent of the households that reported to be depending on crop farming received the earnings seasonally, with only eight per cent receiving earnings daily.

Uganda has two harvesting seasons annually, which means a typical farming family received money twice a year when they sell their harvest.

Of the households that reported commercial farming as their main source of earnings, about seven in every ten households (74 per cent) earned seasonally while 15 per cent earned daily.

Of those that reported non-agricultural enterprises as their main source of earnings, two thirds (66 per cent) reported earning on a daily basis.

RECEIVING MONEY

Respondents were also asked how they received their money from the main sources. Ubos shows that more than half of households in Uganda received payments in cash. At least 31 per cent received their payments in-kind – the use of a good or service instead of cash.

For households in subsistence farming, more than half (53 per cent) received income in cash while 42 percent received the incomes in-kind.

For households whose main source of income was remittances, nearly half (48 per cent) received it in kind while nearly two in every ten households (17 per cent) received it through mobile money.

“The large proportions of households receiving incomes in-kind highlight the extent of informality of payments,” Ubos said.

amwesigwa@observer.ug