Related initiatives

Informal Sector

The informal sector represents a fundamental component of the economic structure of many developing countries. Informal sector enterprises are a key form of organization of production and an important provider of employment and income opportunities in both rural and urban areas. In parallel to the many jobs created in the informal sector (i.e., employment in the informal sector), various forms of informal (or unprotected) employment in the formal sector have shown fast growth over recent years. Studies have shown that, in many developing countries, the informal sector could account for over 50% of non-agricultural employment and nearly 30% of non-agricultural GDP. Even in many countries with economy in transition, the size of the informal sector is estimated to be around 10% (in the case of Kyrgyzstan, as high as 25%).

Measurements of the informal sector and informal employment (informal employment in the formal sector and employment in the informal sector) are important in improving labour statistics as well as in contributing towards exhaustive measures of GDP. Despite their overwhelming importance, the informal sector and informal employment are poorly covered, if at all, by official statistics. Standard establishment and labour force surveys usually capture, or separately identify, only a small fraction of those whose livelihood relies on working in the informal sector or in unprotected jobs. In many developing countries and countries with economy in transition, informal sector is yet to be integrated into national accounts and less information is available on the contribution of the informal sector to economic growth. Even in cases where some data are available, they are often not comparable at the international level and are mostly collected on an ad hoc basis, hampering the construction of harmonized time series and comparative analysis across countries.

The lack of data on the informal sector and informal employment in official statistics often results in distorted estimates of the real economy. For example, without taking into account informal activities, estimates of female economic participation rates could be implausibly low, gross domestic product (GDP) significantly underestimated, and the share of population living below national poverty line overestimated. Lack of information also leads to limited public understanding of many social and economic issues related to informal economic activities, including the differentials in earnings and working conditions between formal and informal employment; social protection arrangements; the characteristics of informal enterprises in the use of technology, access to credit, training and markets; and the input-output relations between formal and informal sector enterprises. These data and measurement problems, in turn, weaken the formulation, implementation and evaluation of policies and programmes aimed at promoting gender equality, eliminating child labour, generating decent work for all and reducing poverty.

The typical characteristics of the productive units in the informal sector - small, high mobility and turnover, seasonality, lack of recognizable features for identification, and the reluctance of information sharing - explains partly why it is often difficult to cover the informal activities with conventional statistical data collection. Since 1993, a series of international efforts has been made to promote the development of a standard definition and measurement tools in this area. The 15th International Conference of Labour Statistics (15th ICLS) in 1993 established international criteria for defining the informal sector, providing considerable flexibility to countries in defining and measuring the informal sector. The 17th ICLS (2003) introduced the concept of informal employment to complement the concept of informal sector.

Based on the framework of international definition, the UN Expert Group on Informal Sector Statistics (the Delhi Group) - constituted in 1997 - has endeavored to harmonize national definitions of the informal sector to improve international comparability. Recognizing the limits of harmonization, the Delhi Group identified a subset of the informal sector that could be defined uniformly and for which countries could produce internationally comparable data. The United Nations Statistics Division (UNSD) is also in the process of updating the 1993 System of National Account (SNA) to provide guidance on the treatment of informal sector in national accounts.

Over the years, with the assistance of ILO, many countries have started collecting and working with data on the informal sector and informal employment, and accumulated extensive experience. Among the set of data collection instruments, labour force surveys - for measuring the size of informal employment and monitoring working conditions - and the mixed household-enterprise surveys - for collecting comprehensive data about the informal sector - have gained increasing importance.

About the project

Interregional Cooperation on the Measurement of Informal Sector and Informal Employment was a multi-year and multilateral Development Account project. The project was implemented by ESCAP as the lead agency, in collaboration with ECLAC and ESCWA. The main objectives of the project were (i) to increase availability of data on informal sector and informal employment and (ii) to improve analysis of this data to calculate the contribution of informal sector to employment and to GDP.

The first component of the project was to raise awareness among the national statistics offices and other government agencies in the participating countries of importance of collecting and disseminating informal sector and informal employment data and incorporating it into employment and GDP estimates. The second component was to enhance capacity to collect, compile, analyze and disseminate informal sector and informal employment data complying with international methodological standards. The expected outputs were published informal sector and informal employment data and a country report covering data collection, compilation, dissemination and analysis experience throughout the project. The project also, contributed to the conceptual work on informal sector by proposing a standardized data collection strategy and producing internationally comparable data.

 

Project Resources

1. Background Documents

Author/ Organization

Title

Document

Year Publication

ESCAP

Project Doc: Interregional Cooperation on the Measurement of Informal Sector and Informal Employment

 prodoc-0607a-16aug06.pdf

2006

ESCAP

Presentation: Interregional Cooperation on the Measurement of Informal Sector and Informal Employment

 measurement-informal-sector-escap.pdf

2006

2. Technical Papers

Author/ Organization

Title

Notes

Document

Year Publication

ESCAP and UNSD

The “1-2” Survey: A data collection strategy for informal sector and informal employment statistics

Working Paper No. 1

 working-paper-no1.pdf

2009

ESCAP

Compilation of output and gross value added from sample survey data on Household Unincorporated Enterprises with At Least Some Market Production (HUEMs)

Working Paper No. 2

 working-paper-no2.pdf

2009

ESCAP

Defining and Measuring Informal Employment and the Informal Sector in the Philippines , Mongolia , and Sri Lanka

Working Paper No. 3

 working-paper-no3.pdf

2010

3. Questionnaires

3.1 Generic Questionnaires

Author/ Organization

Title

Document

Year Publication

Statistics Division, ESCAP

Phase 1 of "1-2" Survey

 generic-questionnaire-phase1.pdf

2007

Statistics Division, ESCAP

Phase 2 of "1-2" Survey

 generic-questionnaire-phase2.pdf

2007

3.2 Country Questionnaires

3.2.1 Mongolia

Author/ Organization

Title

Document

Year Publication

National Statistical Office

Labour Force Survey - 2007

 lfs-questionnaire-mongolia.pdf

2007

National Statistical Office

2007 Survey on Household Unincorporated Enterprises & the Informal Sector

 questionnaire-on-huems-mongolia.pdf

2007

3.2.2 Palestine

Author/ Organization

Title

Notes

Document

Year Publication

Central Bureau of Statistics

Labour Force Survey Part 4

Module on informal employment and for identifying HUEMs

 informal-sector-form-c-palestine.pdf

2009

Central Bureau of Statistics

Household Project Questionnaire

Phase II

 household-questionnaire-palestine.pdf

2009

3.2.3 Philippines

Author/ Organization

Title

Notes

Document

Year Publication

National Statistical Office

ISH Form 2-2008

Labour Force Survey

 ish-form2-phl.pdf

2008

National Statistical Office

Informal Sector Survey ISS Form 1-2008

Labour Force Survey Module (Phase I)

 iss-form1-phl.pdf

2008

National Statistical Office

Informal Sector Survey ISS Form 2-2008

HUEM Survey

 iss-form2-phl.pdf

2008

National Statistical Office

Integrated Household Surveys, Form 2

Labour Force Survey

 labor-force-survey-form2-phl.pdf

Expires: 2008

National Statistical Office

National Timetable of Activities

FIES 2006 (2nd visit), LFS 2007

 national-timetable-activities-phl.pdf

2006

National Statistical Office

Family Income and Expenditure Survey Form 1

FIES 2003 (1st visit)

 2003-fies-form1-phl.pdf

2003

3.2.4 Saint Lucia

Author/ Organization

Title

Notes

Document

Year Publication

Central Statistical Office

Enhanced Labour Force Survey

Phase 1

 enhanced-lfs-st.lucia_.pdf

2008

Central Statistical Office

Household Unincorporated Enterprises and Informal Sector

Phase 2

 huem-is-questionnaire-st.lucia_.pdf

2008

Central Statistical Office

Labour Force Survey

 

 lfs-st-lucia.pdf

2007

3.2.5 Sri Lanka

Author/ Organization

Title

Notes

Document

Year Publication

Department of Census and Statistics

Labour Force Survey Module on HUEMs (2008)

Survey module on Household Unincorporated Enterprises Having Market Output 2008/2009 (Phase 1)

 phase1-sri-lanka.pdf

2008

Department of Census and Statistics

HUEM Questionnaire

Survey module on Household Unincorporated Enterprises Having Market Output 2008/2009 (Phase 2)

 phase2-sri-lanka.pdf

2008

Department of Census and Statistics

Labour Force Survey-2007

Survey module on HUEMs

 huem-lfs-survey-sri-lanka.pdf

2007

Department of Census and Statistics

Sri Lanka Labour Force Survey Questionnaire

Revision of Survey Schedule on literacy, household economic activities, and informal sector employment and under employment

 labour-force-schedule-sri-lanka.pdf

2006

4. Tabulation Plans

4.1 Recommended Tabulation Plans

Author/ Organization

Title

 Document

Year Publication

ESCAP

Tables for Consistency Checks

 tables-consistency-checks.pdf

 

 

Phase 1: Recommended Tabulation Plan (Set 1)

 tabulation-plan-phase1-set1.pdf

 

 

Phase 1: Recommended Tabulation Plan (Set 2)

 tabulation-plan-phase1-set2.pdf

 

 

Phase 2: Recommended Tabulation Plan

 tabulation-plan-phase2.pdf

 

4.2 Recommended Table Headings

Author/ Organization

Title

Notes

 Document

Year Publication

WIEGO/ILO

Recommended Tabulation Variables

June 2009

 table-headings.pdf

2009

 

Basic Tables

 

 basic-tables-lfs-is-ie.pdf

 

 

5. Workshop Materials

Date

Avenue

5.1 Workshops organized by implementing Regional Commissions

Workshop on Interregional Cooperation on the Measurement of Informal Sector and Informal Employment ( isie-ws-report-3-4dec09.pdf )

3-4 December 2009

Bangkok

Regional Workshop on the Measurement of Informal Sector and Informal Employment

30 Nov. - 2 Dec. 2009

Bangkok

Regional Workshop on Informal Sector Surveys in the Caribbean Subregion (report.pdf)

12-13 October 2009

Saint Lucia

Workshop on Informal Employment and Informal Sector Data Analysis, Tabulations and Country Reports

28-29 May 2009

Bangkok

Workshop on Estimating Household Unincorporated Enterprises with some Market Production (HUEMs) and Informal Sector Value Added Using 1-2 Survey Data

25-27 May 2009

Bangkok

Workshop on Informal Employment and Informal Sector Data Collection II: Evaluation, Processing and Utilization of Data from ‘1-2’ Surveys ( ws-isie2-report.pdf )

14-16 May 2008

Bangkok

Workshop on Informal Employment and Informal Sector Data Collection: Strategy, Tools and Advocacy

13-15 April 2008

Amman

National Advocacy Workshop on Measurement of the Informal Sector and Informal Employment

(report.pdf)

3 December 2007

Castries

Workshop on Informal Employment and Informal Sector Data Collection: Strategy, Tools and Advocacy

19-21 September 2007

Bangkok

5.2 Other Workshops

Workshop on Integrated Economic Statistics and Informal Sector for the ECO Member Countries

10-13 November 2007

Tehran

Unified Data Collection on the Informal Sector, ESCAP( unified-data-collection.pdf )

10-13 November 2007

Tehran