The present study was undertaken in Thanjavur District of Tamil Nadu State to assess the impact of declining labours in agricultural sector. In the study 120 farmers and 120 waged labours were interviewed to find the dynamics of labour supply and farmers strategies to cope labour shortage. The wage had increase to an extent of five times in Tamil Nadu in past fifteen years and the compound growth rate of the wage for the male labour was 13.96 per cent and 12.89 per cent per annum for female labour in Tamil Nadu. The low wages, increasing money requirement for consumption, indebtness, unemployment during off season, more drudgery etc., were the major reason for not preferring farm works. It was found that 33 per cent of effective working hours have been reduced. The farmers mitigate labour scarcity by machineries for transplanting, weeding and harvesting etc., and 8.33 per cent of the sample farmers have changed the cropping pattern and moved towards less labour intensive crop like coconut. The Markov Chain analysis revealed that the probability of retention of paddy crop is only 69 per cent and lose 11 per cent of paddy area to coconut. The labour scarcity ultimately leads an unrecoverable impact on the crop production and farmers respond to it by mitigating through machinery and changes in cropping pattern. As it is inevitable to have a structural shift in the profession by the general population during economic progress, accordingly the alternate mitigation strategies have to be carved to continue the farming business.