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8.3.1 Informal Employment (Non-Agriculture)

Target 8.3: Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small- and medium-sized enterprises, including through access to financial services

Goal 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all

Custodian Organization: International Labor Organization (ILO)

Tier Classification: Tier II

To facilitate the implementation of the global indicator framework, all indicators are classified by the IAEG-SDGs (Inter-Agency and Expert Group on Sustainable Development Goals Indicators) into three tiers on the basis of their level of methodological development and the availability of data at the global level, as follows:

Tier I: Indicator is conceptually clear, has an internationally established methodology and standards are available, and data are regularly produced by countries for at least 50 per cent of countries and of the population in every region where the indicator is relevant.

Tier II: Indicator is conceptually clear, has an internationally established methodology and standards are available, but data are not regularly produced by countries.

Tier III: No internationally established methodology or standards are yet available for the indicator, but methodology/standards are being (or will be) developed or tested.

Source: United Nations Statistical Division

Definition: This indicator presents the share of non-agricultural employment which is classified as informal employment.

Concepts: Employment comprises all persons of working age who during a specified brief period, such as one week or one day, performed work for others in exchange for pay or profit.

Informal employment comprises persons who in their main or secondary jobs were in one of the following categories:

  • Own-account workers, employers and members of producers’ cooperatives employed in their own informal sector enterprises (the characteristics of the enterprise determine the informal nature of their jobs);
  • Own-account workers engaged in the production of goods exclusively for own final use by their household (e.g. subsistence farming);
  • Contributing family workers, regardless of whether they work in formal or informal sector enterprises (they usually do not have explicit, written contracts of employment, and are not subject to labour legislation, social security regulations, collective agreements, etc., which determines the informal nature of their jobs);
  • Employees holding informal jobs, whether employed by formal sector enterprises, informal sector enterprises, or as paid domestic workers by households (employees are considered to have informal jobs if their employment relationship is, in law or in practice, not subject to national labour legislation, income taxation, social protection or entitlement to certain employment benefits).

An enterprise belongs to the informal sector if it fulfills the three following conditions:

  • It is an unincorporated enterprise (it is not constituted as a legal entity separate from its owners, and it is owned and controlled by one or more members of one or more households, and it is not a quasi- corporation: it does not have a complete set of accounts, including balance sheets);
  • It is a market enterprise (it sells at least some of the goods or services it produces);
  • The enterprise is not registered or the employees of the enterprise are not registered or the number of persons engaged on a continuous basis is below a threshold determined by the country

Rationale: Informal employment offers a necessary survival strategy in countries that lack social safety nets, such as unemployment insurance, or where wages and pensions are low, especially in the public sector. In these situations, indicators such as the unemployment rate and time-related underemployment are not sufficient to describe the labour market completely. Statistics on informality are key to assessing the quality of employment in an economy, and are relevant to developing and developed countries alike (ILOSTAT indicator description for informality).

Limitations: The considerable heterogeneity of definitions and operational criteria used by countries to measure informal employment greatly hinders the international comparability of statistics on informality. Also, the scope of this indicator is limited to non-agriculture. However, to have a comprehensive picture of the importance of informality in the economy and to better understand its patterns, statistics on informal employment should be produced and analyzed for both agricultural and non-agricultural activities.

Source: United Nations Statistical Division

Data Source: Data for this indicator was primarily collected from the United Nations Statistics Division’s Open SDG Data Hub. National level data is provided to the United Nations Statistics Division by the respective nation, unless otherwise noted. To learn more about the data used in this portal, visit the about page.

Data is accurate as of October 31, 2018.

 
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8.3.1 Informal Employment (Non-Agriculture) in the Sustainable Development Goals

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8. Promote inclusive and sustainable economic growth, employment and decent work for all
8. Promote inclusive and sustainable economic growth, employment and decent work for all

8. Promote inclusive and sustainable economic growth, employment and decent work for all

Roughly half the world’s population still lives on the equivalent of about US$2 a day. And in too many places, having a job doesn’t guarantee the ability to escape from poverty. This slow and uneven progress requires us to rethink and retool our economic and social policies aimed at eradicating poverty.

A continued lack of decent work opportunities, insufficient investments and under-consumption lead to an erosion of the basic social contract underlying democratic societies: that all must share in progress. The creation of quality jobs will remain a major challenge for almost all economies well beyond 2015.

Sustainable economic growth will require societies to create the conditions that allow people to have quality jobs that stimulate the economy while not harming the environment. Job opportunities and decent working conditions are also required for the whole working age population.

Related 8.3.1 Informal Employment (Non-Agriculture) Targets

8.3

Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation, and encourage the formalization and growth of micro-, small- and medium-sized enterprises, including through access to financial services