Ethiopia’s economy remains at a very early stage in its structural transformation. A puzzle presents itself as to how such growth can be maintained given its relatively low urbanization rate and its reliance on the agricultural sector as the primary form of employment. This chapter examines labour diversification in Ethiopia, focusing on youth, and explores current conditions that youth face in both the agricultural and nonfarm labour markets. Using data from the Ethiopia Socioeconomy Survey (ESS) and the National Labour Force Survey (NFLS), we explore current trends in labour diversification, along with youth nonfarm engagement in rural and small towns. We find that youth (ages 25 to 34 years) have a greater probability of working in nonfarm enterprises compared to mature individuals (age 35–64). However, wage labour opportunities remain scant in rural Ethiopia. The majority of individuals working in nonfarm employment are engaged in small-scale trade activities.

This study aimed to appraise the role of local institutions in adaptation to changing climate at the local level in the Bilate Basin Agropastoral Livelihood Zone of Ethiopia. Thirty-one years of climate data were analyzed by employing the Mann–Kendall trend and Sen’s slope test techniques. The survey was conducted on 400 households that were systematically randomized from 7066 households, while community-level data were collected through the participatory rural appraisal (PRA) technique. The entire analysis was framed by a tetragonal model. The results of the analysis indicated that temperature exhibited a significantly increasing trend, while rainfall, which is statistically related to temperature, showed a decreasing trend, resulting in lingering droughts and human and animal diseases. Major livestock declined by 69%. As a response, while Sidama indigenous institutions were well-functioning and nurtured through local knowledge, and the governmental and civic ones were entrenched with various limitations. Contextual fitness and compatibility, interplay, inclusiveness, and sustainability of their operations in temporal and spatial scales were some of their limitations. Therefore, federal and local governments should focus on monitoring, evaluating, and learning aspects of their grand strategies, review general education, farmers’ credit, and civic institutions’ governance policies and strengthen the synergy of civic, government, and indigenous institutions.

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