Institute for Development Studies, University of Nairobi

The purpose of this progress report is to raise discussion propositions about how so-called "informal" skill formation relates to rural industrial development. Four issues have been demarcated as central for commencing to conceptualize skill formation and rural industrial development: i) Consequences of the prevailing subsistence economy for the development of rural industries in Kakamega District, ii) Influence of the general labour market situation on employment situation of rural industrial entrepreneurs and labourers and the consequences for skill formation in this labour force, iii) Consequences of workshop organization in different rural industrial branches for the methods of training labour and iv) Impact of institutional technical training on the quality of workmanship and productive employment opportunities. The stratums of industries which are reckoned among "informal sector" activities are a major source of skill acquisition for the majority of rural industrialists. Unsystematic on-job-training may qualify labour for industrial employment rather than for self-employment. The first attempts to systematise technical training at the lower ranks of the industrial structure are seen in the Village Polytechnic Programme. The potential quality of workmanship may thereby increase but the possibilities for self-employment not necessarily so. The prevalence of the subsistence economy by which rural industrial labour is partly maintained on the one hand, and the "formal sector's" absorption of basically skilled labour on the other, prevents the creation of a stable industrial skilled labour force in rural areas. It is attempted in this study to provide basic information on skill formation in the "transition" from modest subsistence supplementary industrial activities to more progressive industries. The approach is to analyse the process in1 particular industrial branches.