As USAID and other donors explore approaches and issues that can improve the poverty-reducing impact ofits market systems development work, labor markets—and in particular labor that is relevant to the poorest in
rural, agriculture-based economies—emerge as a priority. Thus this LEO initiative on “Highlighting Labor in Agricultural Market Systems” aims to raise awareness and to develop practical resources to support better integration of labor into the practice of market systems development. As its first output, this report provides a stock-take on the current literature on employment and pathways out of poverty, with a special focus on rural wage labor. It also proposes some initial implications for programs in order to yield greater employment and poverty reduction impacts.