The Economics of Rural and Urban Small-Scale Industries in Sierra Leone. African Rural Economy Paper No. 14.

Small-scale industry in Sierra Leone, Africa was examined in terms of: labor intensity; output generated per unit of capital; generation of positive economic profits by small-scale industry groups/processes; and seasonal and locational variations. Key analytical issues were the nature of small-scale industry supply and demand processes. Data were obtained from 270 firms (66% randomly selected from localities of 2,000 or more and 33% purposively selected to ensure a spectrum of production techniques). Some major results were: small-scale industries accounted for 95% of the employment and about 43% of the value added of the entire industrial sector; 95% of the establishments, 86% of the employment, and 75% of the value added were generated by rural small-scale industries; there were variations in small-scale industry annual mean output and value added, level of activity, seasonal patterns, magnitude of capital input, amount of excess capacity (the highest amount was in rural localities); there were modest initial capital requirements; the apprentice/proprietor labor supply served as the primary source of training; demand for small-scale industry products came from rural and urban consumers, backward and forward production linkages with agriculture, and exports; the more traditional production processes generated both a higher output and a larger amount of employment per unit of scarce capital than large-scale industry. (JC)