Informal Employment (Edexcel IGCSE Geography)

Causes of Informal Employment

• Informal employment is any employment which is unregulated and unofficial

• It is estimated that more than 60% of the world's employed population work in informal employment

• As much as 93% of informal employment is in developing and emerging countries

• Most informal employment is work in the tertiary sector

• Examples of jobs in the informal economy include:

  • Shoe shining

  • Rubbish collecting

  • Selling fruit or other products on the street

  • Para-transit - including rickshaws and tuk tuks

• There are a number of causes of informal employment

Impacts of Informal Employment

• People working in the informal economy: 

• Have no healthcare benefits

• Are often exposed to health or safety risks

• Have no contracts or guaranteed pay

• Have no holiday or sick pay

• Para transit often causes congestion and if motorised they cause additional pollution

• Lack of regulations means workers are often exploited by employers 

• Many children working in informal employment do not get the opportunity to go to school

• Children may be exposed to health risks, drugs, violence and crime

• Governments collect less in tax because the jobs are not official 

Case Study: Informal Employment in Dhaka

• Dhaka is the capital of Bangladesh 

• It is a megacity with a population of 22.5 million people

• Approximately 400,000 people migrate to Dhaka each year

• Estimates suggest that over 75% of the population are engaged in informal employment:
  

  • 500,000 rickshaw drivers

  • 80,000 waste related workers

  • Workers in small workshops

  • Casual workers in restaurants and hotels

  • Day labourers in construction

• Informal employment also includes children with over 690,000 children in Dhaka involved in informal employment

• Many of Dhaka's informal workers live in informal settlements

Characteristics of Dhaka's Informal Sector

• Low pay

• Long working hours

• Temporary or part-time work

• Underemployment

• No benefits such as holiday pay or sick pay

• Poor and unhealthy working conditions

• Health and safety risks

• No training

• Exploitation by employers

• No legal protection