Villagers, aka, Civilians, are generated by the Town Hall while Happiness is 0 or greater. Villagers will gather Food in the wild if they are not assigned to a specific building, each Villager will gather +4 Food . To do this, they need either the Town Hall, a House, or a Food production building (but not a Sheepfold) to gather. They will however, construct buildings that need to be built (but not repaired) on that tile first, but then go back to gathering Food as normal.
To turn trained specialists (e.g. merchants) back in to ordinary villagers just select them and then right-click on a house or the Town Hall.