In this paper, we investigate the impact of non-farm employment (disaggregated by wage- and self-employment) on household income and poverty. Using a propensity score matching model, we evaluate the differences in outcomes between households who participate in the non-farm employment and those who do not. The results from the study show that non-farm wage-employed households in rural Nigeria have a significantly higher income than self-employed households. Second, we show that non-farm wage-employment impacts more on household welfare than non-farm self-employment. Third, we show that the benefits to non-farm wage-employment are much higher among the non-poor than among the poor.