[lbo-talk] "Globalization" & the Informal Sector

[Yoshie Furuhashi]

The typical face of "globalization" is that of a woman in the informal sector.

*****   Over the past two decades, employment in the informal sector 
has risen rapidly in all regions. It was only the 
once-rapidly-growing economies of East and Southeast Asia that 
experienced substantial growth of modern sector employment. However, 
even in these countries, a significant percentage of women workers 
were in rural and informal employment before the Asian financial 
crisis: for example, 43 percent of women workers in South Korea and 
79 percent of women workers in Indonesia. Moreover, in the wake of 
the recent crisis, most of these countries have experienced a decline 
in formal wage employment and a concomitant rise in informal 
employment.

Even before the Asian crisis, official statistics indicated that the 
share of the informal sector in the non-agricultural workforce ranged 
from over 55 percent in Latin America to 45-85 percent in different 
parts of Asia to nearly 80 percent in Africa. The contribution of the 
informal sector - not only its size - is quite large. The 
contribution of informal sector income to total household income is 
significant in many regions: for example, in several African 
countries, informal sector income accounts for nearly 30 percent of 
total income and over 40 percent of total urban income. The 
contribution of the informal sector to GDP is probably also 
significant. For those countries where estimates exist, the share of 
the informal sector in non-agricultural GDP is between 45 to 60 
percent.

SIZE OF THE FORMAL ECONOMY

               Low-Income     Middle-Income     High-Income
               Countries      Countries         Countries

Share of         17%            58%               84%
Formal Wage
Employment
in Total
Employment

Source: World Development Report 1995. Washington, D.C.: World Bank.

SIZE OF THE INFORMAL ECONOMY

Informal Sector  Latin America/Caribbean   Africa   Asia
Share Of:
 
Non-Agricultural          57%               78%      45%-85%
Employment

Urban Employment          40%               61%      40%-60%

New Jobs                  83%               93%      N/A

Source: Charmes, Jacques. 2000.  Informal Sector, Poverty, and 
Gender: A Review of Empirical Evidence.  Paper commissioned for World 
Development Report 2000/2001.  Washington, D.C.: World Bank.

The informal economy is a major growth sector

* The informal sector accounts for large share of output and employment
* The informal sector accounts for more than half of non-agricultural 
employment in Latin American and the Caribbean, nearly half in East 
Asia and as much as 80 percent in other parts of Asia and Africa
* The informal sector is responsible for 93% of new jobs in Africa 
and 83% in Latin America and the Caribbean
* Nearly three-fourths of manufacturing in South East Asia is done by 
informal sector workers
* For those countries where estimates exist, the informal sector 
accounts for 45 to 60 percent of non-agricultural GDP. . . .

(Women in Informal Employment Globalizing and Organizing, "Fact 
Sheets: The Informal Economy," 
<http://www.wiego.org/main/fact1.shtml>)   *****
-- 
Yoshie

* Bring Them Home Now! <http://www.bringthemhomenow.org/>
* Calendars of Events in Columbus: 
<http://www.osu.edu/students/sif/calendar.html>, 
<http://www.freepress.org/calendar.php>, & <http://www.cpanews.org/>
* Student International Forum: <http://www.osu.edu/students/sif/>
* Committee for Justice in Palestine: <http://www.osudivest.org/>
* Al-Awda-Ohio: <http://groups.yahoo.com/group/Al-Awda-Ohio>
* Solidarity: <http://www.solidarity-us.org/>