Employment and gender differences in the informal economy

1. Employment and gender differences in the informal economy Valentina Stoevska (stoevska@ilo.org) Department of Statistics International Labour Office- Geneva International Labour Organisation, Department of Statistics

2. Overview Limitations of the current MDG Indicator 3.2 Growth of the employment in informal sector (IS)/ informal employment (IE) Statistical definitions of the employment in informal sector and informal employment Some findings re employment in informal economy References International Labour Organisation, Department of Statistics

3. Limitations of the current MDG Indicator 3.2 • non-agricultural wage employment represents only a small portion of total employment, • contribution of women to the national economy underestimated and misrepresented • difficult to interpret, • does not reveal that there are different types of non-agricultural wage employment International Labour Organisation, Department of Statistics

4. Additional indicators • Employment by sector (agriculture, industry , services), • Wage employment in agriculture, • Employment by status in employment (employees, employers, contributing family members, etc.), • Employment in managerial occupations, • Employment in the informal economy, • ... More comprehensive picture of the women situation in the labour market, and changes International Labour Organisation, Department of Statistics

5. Reasons to monitor informal employment/ employment in the informal sector • Growth of the informal economy • Employment creation, income generation and poverty eradication but workers lack legal and social protection. • Informalisation of employment is partly attributable to ‘globalisation’ process: competitive pressure on enterprises leads to mixed-mode labour arrangements (non-standards, atypical, irregular, precarious): • Exists everywhere (incl. industrialised countries), and in the formal sector • Relevance and meaning varies by country International Labour Organisation, Department of Statistics

6. Informal sector: Motives for participation • Survival strategy: lack of other jobs, obstacles to employment in the formal sector, need to supplement family income • Independence, • Flexible work arrangements, • Profitable income-earning opportunity, • Non-compliance • Regulations, tax payments, social security contributions  reduced production costs International Labour Organisation, Department of Statistics

7. ICLS Conceptual framework: Employment in the informal economy ‘Employment in the IS’ and ‘informal employment’ refer to different aspects of the «informalisation» of employment Employment in IS: employment in informal enterprises. -defined in terms of characteristics of production units/enterprises (enterprise based) Informal employment: employment in informal jobs. - defined in terms of characteristics of persons or their jobs (job based) Employment in the informal economy defined as the sum of jobs in the informal sector and of informal jobs outside the informal sector. International Labour Organisation, Department of Statistics

8. Conceptual framework:Employment in the informal economy Employment in the informalsector: A + B Informalemployment: A + C Informalemploymentoutside the informalsector: C Employment in the informaleconomy: A + B + C International Labour Organisation, Department of Statistics

9. Definition of IS enterprises (15th ICLS) Private unincorporated enterprises, Not constituted as separate legal entities, No complete accounts available, At least some goods or services produced are meant for sale or barter, Enterprise size below low threshold,: Enterprise not registered under specific forms of national legislationat national level, Engaged in non-agricultural activities. International Labour Organisation, Department of Statistics

10. Definition of Informal Employment (17th ICLS) Total number of informal jobs carried out • in formal sector enterprises or • in informal sector enterprises or • in households • during a given reference period. Employees are considered to have informal jobs if not covered by social security system or not entitled to other employment benefits such as paid annual or sick leave. International Labour Organisation, Department of Statistics

11. Components: Informal employment outside informal sector Employees In informal jobs in formal sector enterprises, Paid domestic workers employed by households. Contributing family workers Working in formal sector enterprises. Own-account workers Engaged in goods production exclusively for final use by own household (if employed according to 13th ICLS employment definition). International Labour Organisation, Department of Statistics

12. Some findings re employment in informal economy(based on national LFS data that are processed by using international definitions of informal employment/informal sector) International Labour Organisation, Department of Statistics

13. International Labour Organisation, Department of Statistics

14. Source: ILO, Department of Statistics International Labour Organisation, Department of Statistics

15. Informal employment in and outside IS, as % of non-agricultural employment Source: ILO, Department of Statistics International Labour Organisation, Department of Statistics

16. Source: ILO, Department of Statistics Share of informal employment in total non-agricultural employment declines as the level of development rises. International Labour Organisation, Department of Statistics

17. Employment in the informal economy Gender differences Informal employment in non-agricultural activities by sex for selected countries, % Women are more likely than men to have informal jobs, suggesting that women turn to the informal jobs more often than men because they lack opportunities or they face other obstacles to formal employment. International Labour Organisation, Department of Statistics

18. Employment in the informal economy Gender differences Informal employment outside informal sector, in non-agricultural activities, by sex for selected countries, % Women are more likely than men to have informal jobs outside the informal sector. International Labour Organisation, Department of Statistics

19. Employment in the informal economy Gender differences Employment in informal sector, non-agricultural activities, by sex for selected countries, % Women are less likely than men to have jobs in informal sector enterprises. Men outnumber women in informal sector enterprises. International Labour Organisation, Department of Statistics

20. Need for further disaggregation e.g. by geographic region (urban/rural) International Labour Organisation, Department of Statistics

21. References Resolution concerning statistics of employment in the informal sector (adopted by the Fifteenth International Conference of Labour Statisticians,1993) Guidelines concerning a statistical definition of informal employment (adopted by the Seventeenth International Conference of Labour Statisticians, 2003) http://www.ilo.org/global/statistics-and-databases/standards-and-guidelines/lang--en/index.htm LABORSTA, an International Labour Office database on labour statistics operated by the ILO Department of Statistics http://laborsta.ilo.org International Labour Organisation, Department of Statistics