About one-third of Salvadorans are farmers. Although land reform has meant the redistribution of some property to individual and peasant-owned cooperative farms, much of the land is owned by larger plantations employing workers for low wages. Rural families with household plots of land grow maize, beans and sorghum for their own consumption. Often women tend the home gardens, while men work on plantations.

The country’s main cash crop is coffee, followed by sugarcane and cotton, all of which are typically grown on estates. Coffee plants thrive in El Salvador’s mountainous regions, while cotton is grown in the tropical coastal lowlands. Cattle are also raised on the central plateau. Recently developed export crops include sesame, poppy seed, flowers and tropical fruits. On the coasts, shrimp farming has become an important source of revenue. However, despite the prevalence of agriculture, El Salvador has an inadequate land mass for its population and still has to import about one-quarter of its food supply.

El Salvador has the highest concentration of manufacturing in Central America. Factories produce textiles, clothing, rubber goods, furniture, construction equipment, chemicals and pharmaceuticals. An electronics assembly industry is also currently developing. Although women work as teachers, health care workers and engineers, a primary source of employment is maquilas. In these factories, foreign companies import raw materials to be assembled into finished goods often name brand items sold in North America. Maquilas are now the main source of El Salvador’s export revenue. Traditionally, maquilas have had a reputation for poor labour standards and union repression. However, international manufacturers working with the El Salvador government have been successful in improving and monitoring working conditions.

Salvadorans are entrepreneurial people. City street vendors, mostly women and their children, sell a wide range of items, including homegrown fruit and vegetables, snacks, clothing and crafts. Many people use an economic system of bartering, trading and doing favours. Children earn extra income by selling newspapers, shining shoes or guarding and washing cars.

El Salvador’s economy is one of the poorest in the western hemisphere, affected by years of war, the aftermath of colonialism and vulnerability to international price swings particularly that of coffee. Environmental disasters such as Hurricane Mitch (1998) and earthquakes in 2001 have disrupted agricultural production. Underemployment is high, in some areas as much as 50%. Despite these issues, El Salvador’s economy has been strengthening since 1990 due to increased trade and financial help from both Salvadorans living abroad and other countries.