Trade and Employment From Myths to Facts - International Labour ...

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Trade and Employment: From Myths to Facts Table 4.1: The informal (sub)sector within the sector concept Corporations Household sector sector Informal sector Quasi- Unincorporated Unincorporated Unincorporated Illegal corporate enterprises enterprises enterprises activities household owned by owned by owned by enterprises households, households, households, engaged in engaged in engaged in farming non-farm non-farm production production with fixed with non-fixed location location Source: Advisory Expert Group on National Accounts, SNA/M2.04/12; New York, 8-16 December 2004. Hussmanns (2004), in turn, defined employment in the informal sector as including all jobs in the informal sector enterprises or all persons who, during a given reference period, were employed in at least one informal sector enterprise, irrespective of their status in employment and whether it was their main job. Illegal activities, however, are not part of the informal sector definition. The broader concept of an informal economy as a composite of productionunit and labour-process aspects of informality has been recognized and defined by the ILO Task Force (ILO, 2002a) and in Sinha (1999) and Sinha and Adam (2000), in contrast to earlier studies, which indentified only production units. The “informal economy” captures employment relations as well as enterprise relations. The concept of “informal employment” refers to the production unit and the characteristics of the job or worker. 128 Box 4-1: The ILO framework of informality The 2002 ILO International Labour Conference Resolution concerning decent work and the informal economy provided a framework rather than a specific definition. The term “informal economy” refers to “all economic activities by workers and economic units that are – in law or in practice – not covered or insufficiently covered by formal arrangements. Their activities are not included in the law, which means that they are operating outside the formal reach of the law; or they are not covered in practice, which means that – although they are operating within the formal reach of the law, the law is not applied or not enforced; or the law discourages compliance because it is inappropriate, burdensome, or imposes excessive costs”. (ILO, 2002b)
Chapter 4: Trade and the informal economy The term “informal employment”, as used by the ILO Task Force (ILO, 2002a), defines employment that has no secure contracts, worker benefits or social protection. So the major components of such employment are: (a) self-employment in the informal economy; and (b) paid employment in informal occupations. The latter could also be in the formal sector. Thus, it includes casual and precarious work within the formal economy. More precisely, at the Seventeenth International Conference of Labour Statisticians (ICLS), it was agreed that informal employment comprises the following types of jobs (ILO, 2003): ● Own-account workers who have their own informal sector enterprises and no employees (cell 3 in table 4.2). ● Employers with employees who have their own informal sector enterprises (cell 4) (the informal nature of their jobs follows directly from the characteristics of the enterprise). ● Contributing family workers, irrespective of whether they work in formal or informal sector enterprises (cells 1 and 5). ● Employees who have informal jobs, whether employed by formal sector enterprises, informal sector enterprises, or as paid domestic workers by households (cells 2, 6 and 10) (employment relationship is not subject to standard labour legislation, taxation, social protection or entitlement to certain employment benefits). ● Employees, who hire more than six to nine workers are generally considered formal (cell 7). ● Members of informal producers’ cooperatives (cell 8) (not established as legal entities). ● Persons engaged in the own-account production of goods exclusively for own final use by their household (cell 9). The three aspects of informal economy defined by the 15th ICLS (as noted above) are useful for analysing informality, both as traditionally defined (based on what might be called the “production unit view” (see table 4.1) that focused on the type of production unit (rows)) and according to the newer focus (defined according to the “social protection” or “legalistic” view by job status). Informal sector enterprises are defined as production units operated by single individuals or households that are not constituted as separate legal entities independent of their owners and in which capital accumulation and productivity are low. This includes “family units” (those operated by non-professional own-account workers with or without contributing family workers) and “micro-enterprises” (productive units with no more than five employees). Furthermore, taking the 17th ICLS on board, table 4.1 shows that total employment in the informal sector includes the self-employed, 129
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Trade and Employment From Myths to
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Trade and Employment From Myths to
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PREFACE Trade negotiations -bilater
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Trade and Employment: From Myths to
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EDITORS AND CONTRIBUTORS EDITORS Ma
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ACKNOWLEDGEMENTS The editors wish t
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NEW EVIDENCE ON TRADE AND EMPLOYMEN
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Chapter 2: New evidence on trade an
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Region Annualized percentage change
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Region 1980 1985 1990 1995 2000 200
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Figure 2.4.b: Long-run association
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20 See Harrison and Rodriguez-Clare
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ASSESSING THE IMPACT OF TRADE ON EM
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Chapter 3: Assessing the impact of
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A third view is that the type of jo
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REFERENCES Chapter 5: Gender aspect
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