the finding from the earnings analysis which shows that local factors play an important role in determining earnings, in additional to individual characteristics. This may be because in a more dynamic local economic environment, opportunities for earning income are higher, or it may reflect differences in governance and access to infrastructure services such as workplaces and market stalls.

By focusing on HEs as a source of employment, a viable enterprise, and a household livelihood, we have been able to identify more clearly the characteristics of this sector in SSA and what makes this sector special, so that effective policies and strategies can be developed. Our data do not contain much information on specific projects or programs, so this paper is primarily an empirical analysis of the sector. Nevertheless, the analysis in this paper points to the following insights for development policies and programs:

- _The majority of enterprises are in rural or semi-rural areas, and these are often seasonal ventures_ , especially in the lowest income countries where investments in the agricultural value chain (including water management and market infrastructure) have not reduced risk or raised productivity enough to encourage households to specialize in one sector or another. Programs to support the sector need to take account of this trend. If the trend in Ghana could be generalized, it indicates that as market infrastructure develops and technology and irrigation is brought in, specialization occurs naturally.<sup>16</sup>

- _Although very active in the sector, females are disadvantaged with respect to earnings._ Women tend to be occupationally segregated in this sector, and the traditional apprenticeship system reinforces this. Women are also less likely to create enterprises in rural areas - reflecting a rural household strategy which tends to assign females the role of food security in the family. Local norms may also affect the opportunities of female HE owners differently than those ofr males. Whatever the cause, the result observed in our analysis was a large unexplained male-female earnings gap. Effective programs of support will need to take account of this issue and strive for an understanding at the local- and program-level of these factors. If not, women may be left behind.

- _This sector is not currently a solution for the youth employment problem._ Although this sector is often designated as an entry point to employment for youth, our data suggests the contrary, as those under 25 have a very low probability of being HE owners. The need for basic technical and business skills usually acquired on the job or in lengthy traditional apprenticeships, as well as, the need for start-up capital appears to be important factors. Where youth are employed in this sector, it is usually as contributing family workers. They may be learning on the job, or they may be just be working in this sector while looking for a better opportunity. More research is needed on successful, scalable strategies to achieve breakthroughs here.

- _Financial inclusion is an important issue_ . More work is needed in country-specific contexts on what might be the key elements of a support program.  However; one result comes out clearly: enterprise owners want easier access to capital.  Lack of capital is reported as both the biggest obstacle to start-up and a major constraint to sustaining the business. At this point, few HEs are being served by the microfinance industry or other initiatives.

> 16 This is also a key finding of a rural transformation study of 7 countries, including four SSA countries (Losch B., Fréguin Gresh S. and E. White, 2011).

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