Breaking the Vicious Circles of Informal Employment and Low-Paying Work
This report adds two perspectives on informality. First, it disassembles the mechanics of the deleterious links between informal employment, low-paying work and low skills. It shows that informal employment is highly persistent, and that the vulnerability of informal workers is passed on to their children in the absence of adequate education, skills and social protection policy. Second, the report underscores the double burden of informality and low-paying work that a large share of workers in developing and emerging economies carry, and as such calls for policy solutions that go beyond the formalisation agenda and embrace the goal of social justice.
Transitions to and from formal employment and income dynamics
Formalisation provides social security and labour law protection; but does it also improve earnings and lift workers out of low-paying work? This chapter analyses four issues. First, it inquires into how common transitions to formal employment are. Second, it analyses whether the chances of transitioning to formal jobs are the same for all types of informal workers. Third, it investigates whether formalisation is indeed accompanied by income improvements for workers, and conversely, whether transitions into informal employment are accompanied by income losses. Finally, it inquires into whether the potential benefits of formalisation accrue to all workers.
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