Training and informal economy - Documents and publications

This document analyses the effects of the process of stabilisation and structural reform undergone during the nineties regarding the behaviour of employment and salaries in Argentina.
The labour market, which suffered adjustments inside its institutional framework in accordance with those made in other areas, did not follow the country's success in terms of stability and growth.
The little impact of production expansion on employment observed between 1991 and 1995 contributed to increase unemployment, which reached overwhelming proportions in the country.
The study highlights the fact that the slow evolution of formal employment neither resulted in a balanced growth of the informal sector nor had effects on open unemployment, which is a striking characteristic of the period.

Carpio, J.; Klein, E.; Novacovsky I. (Comp.) Informalidad y exclusión social. (Informality and social exclusion). Buenos Aires: ILO, Fondo de Cultura Económica, 2000. 336 p. ill.

The articles contained in this book are the result of the Research Programme developed within the framework of the Forum on Informality and Social Exclusion organised by the System of Information, Assessment and Monitoring of Social Programmes (SIEMPRO), which depends from the Secretary of Social Development, the Sub Secretary of Social Projects of Buenos Aires in collaboration with the International Labour Organisation between 1997 and 1998.

The purpose of this study is to establish a social demographic and labour profile and to become familiar with the motivations, problems, satisfactions and training needs of female home-based workers in Chile and suggest recommendations to guide training policies rooted in the reality of this group of women.

This paper presents theory and evidence on the determinants of the size of the informal sector. It proposes a simple theoretical model in which the informal sector's size is negatively related to institutional quality and positively related to income inequality.

This paper takes a non-traditional perspective, i.e. it concentrates on the presence of an informal sector considered as a structural barrier to sustainable growth. Therefore, the coexistence of the formal and informal sector appears as a peculiar way of structural heterogeneity that hinders development in the region. It clarifies the concept of informality and its main streams which differ from each other in terms of definitions and policy proposals. It informs about the dynamics of the product, productivity and employment and its growth in a dual economy.

Córdoba, M.; Gottret, M. V.; López y Asociados, T.; Montes, Á.; Ortega, L.; Perry, S. Innovación participativa: experiencias con pequeños productores agrícolas en seis países de América Latina. (Participating innovation: experiences with small rural producers in six Latin American countries). Santiago, Chile: ECLAC, 2004. (Productive Development, 159).

The document contains case studies on participation research experiences with rural producers. Its objective was to review some relevant experiences of technological innovation with small producers of Latin America, highlight the importance of this subject to rural development and suggest elements of governmental policy/strategy and instruments to promote them, focusing on eventual specific approaches that ensure gender equity.
Five different experiences carried out in Bolivia, Cuba, Colombia, Nicaragua and indigenous communities in Mexico with varied plantations (potato, yucca, beans, corn, banana and wood products).
The participating research has the advantage of actively incorporating farmers in the definition, prioritisation and solution of problems, bringing together both their knowledge about the complex productive systems and other political or social systems in which they act.
The above adds to the research since while they are trained in new production techniques, thus improving their competitiveness, they build formal and informal links among them, which brings along a better quality of life for them.

Di Martino, V.; Filippi, S.; Loiselle, C. Company cases and cross-company initiatives. Working conditions improvement in Haiti. Geneva: ILO, 2003.

This document describes a project that is being implemented in Haiti to improve the working conditions in the garment assembly sector. Allegations of sub-standard working conditions have been dissuading potential foreign investors from doing business in Haiti.
The project is structured around the technical assistance and training of ILO's "WISE" (Work Improvements in Small Enterprises) approach, which provides simple, low-cost and practical ideas for improvement of working conditions that can help businesses to improve their productivity at the same time. The project was implemented through the Haitian employers' organisation ADIH.
The document highlights the lessons learned and the good practices regarding the improvements in working conditions, particularly regarding safety, noise reduction and workers' welfare.

Durston, J. Capacitación microempresarial de jóvenes rurales indígenas en Chile. Lecciones CTI del programa 'Chile Joven' (SENCE/ INDAP) en dos comunidades mapuches. (Micro entrepreneurial training for indigenous rural youth in Chile. CTI lessons from the "Chile joven" programme (SENCE/INDAP) in two mapuche communities). Santiago, Chile: ECLAC, 2001. (Social Policies, 49)

This study focuses on the institutional and contextual aspects of rural youth training in Chile. It deals with the issues of institutional learning related to the participation of training programmes in the rural area and the problems of the youth association microenterprise, regarding issues related to public administration and the externalisation of training services to the market.
The analysis focuses on the "Freelance Work Training" (CTI) Programme, the "Chile joven" programme of the National Training and Employment Service (SENCE) of the Ministry of Labour.
The case study of this paper was carried out in two mapuche indigenous communities of the south of Chile. The special features of training young people from this indigenous people are part of the main three concerns of this report, together with the learning related to the externalisation of the labour market and the particular challenges of youth training for microenterprise management.

This document deals with adolescent and youth issues in three key aspects to be put to the consideration of the Heads of State and Government. It first analyses how adolescents grow and mature, showing the problems, opportunities and challenges they are faced with today. Then, it mentions an integrated group of sectoral public policies concerned with education, health and labour and social insertion. It particularly studies how quality in education segments youth participation in the labour market, being most of them employed by micro and small enterprises and lacking social security protection. This is why these ventures are given so much importance; they are a way to improve labour insertion and life quality of young people.
On account of the above, the document makes articulated proposals focused on the strategic and managerial field, with the aim of largely improving the effectiveness, efficiency and relevance of the actions taken, particularly in terms of education and training. Therefore, the idea is to strongly promote the incorporation of a real generational perspective into public policies, with the aim of improving the quality of life children, adolescents and young people.

This policy analysis focuses on the school-to-work transition as providing the central context in understanding youth unemployment in Latin America.
Youth unemployment is not a transitory state to employment, rather it is a very lengthy process where youth move from unemployment, schooling, unpaid unemployment, and low-wage unskilled employment - all of which have low opportunity costs.
The youth transition process, including that of youth unemployment, clearly reflects that of larger labour market trends - the considerable informality of the labour market, the growing skills-wage gap between workers in the formal-informal sector; and falling incomes of informal workers, moving precariously toward the income poverty line.
The document tries to examine how the policy on structural adjustment applied during the last decade, the economic growth, the specific plans and programmes on employment and youth have had impacts on this transition. Finally, some possible action policies are outlined to overturn this situation.

This paper discusses the transition of young people to work, particularly into the informal sector of the economy in Kenya. The informal sector in Kenya is now responsible for absorbing the larger proportion of new entrants into the job market. To understand this process this paper examines the development of the informal sector in Kenya and recent trends in its evolvement; entry into the informal sector and the characteristics of young people entering the sector; the training process in the sector; and the implications for education and training.

The study has two objectives: to evaluate the degree of poverty and lack of social protection of informal workers in three countries of the region: Barbados, Trinidad and Tobago and Venezuela; and to recommend mechanisms for broadening social security and assistance coverage of informal workers in the selected countries. To do so, a description and assessment is made with regards to the social security system of the three countries. The dynamics of labour markets are analysed together with the relationship between informal employment, poverty and social protection. Finally, a diagnosis on social protection for informal workers is made and some recommendations on social protection are given.

In this article the author reflects upon the changes occurred in world economy, the effects of this stage of globalisation on the labour market of underdeveloped economies and the impact on the life standards of people. He analyses the Brazilian educational system: middle and basic education and vocational training.
It particularly studies how the changes in the integrated System S have accompanied the changes in the labour market. It analyses whether the training provided adapts to new labour forms (and to what extent), the new precariousness and instability of employment and the increasing informality and unemployment.

The growth of high-quality employment needed to reduce the share of informal occupation and open unemployment in Peru will require an acceleration and diversification of private investment in the tradable sector. One of the main constraints faced is the uncompetitiveness of the non-extractive tradable sector. In 1990-2003, competitiveness improved in this sector essentially as a result of lower labour costs, a socially unjust and economically ineffective route to follow. To raise competitiveness, it is essential for the macroeconomic regime to include a competitive real exchange rate (to which there are obstacles) and higher productivity at the microeconomic level. This latter goal needs to be pursued through microeconomic and mesoeconomic policies, the main obstacle being the narrow outlook prevailing from the mid 1990s onward, which emphasized the reduction of average labour costs as the main way to raise competitiveness.

This document studies the relationships between large and small enterprises with case studies conducted in four sectors. It particularly analyses the reasons why large enterprises use outsourcing to hire micro and small enterprises and how the latter keep their profit margins, largely due to the reduction in labour costs by employing informal workers. Four case studies are presented which reflect different modalities that are configured and tend to change with the impacts of the crisis, opening and modernisation of the sectors covered by these enterprises.
This allows to understand the trends in work conditions, job quality, salaries and staff training modalities of different types of enterprises, in addition to the training instruments encouraged by them.

While women are many times discriminated and edged out of the labour world, they are strongly represented in the informal economy and, trade unions of women in the informal economy have been emphasized. Home-based textile workers in Argelia, Brazil and the United States, street vendors in India and Moldavia, free-lance hairdressers in Ghana, peasant farmers in Peru, home-based child carers in Croatia; fishmongers in Chad…all have their tale to tell as trade unionists. The fundamental trade union principle of solidarity is at stake, but so is the very survival of the trade union movement worldwide.

This paper gives an account of a research conducted in Brazil which studied the various forms of employment in a reduced group of people.
The analysis concludes that poor schooling and vocational training in the workers interviewed are key elements of the employment problem they suffer.
It shows how the occupational paths of the interviewed workers are marked by an early entrance in the labour market, short-term employment relationships and occupations, high levels of informality, particularly among women, frequent unemployment, low performance and low qualification required by the activities done.
All these indicators show how workers who have a low educational level and little or non-existing vocational training usually have the least favoured jobs in formal employment, or informal occupations, while they still are mostly affected by unemployment.

This document gives an account of the vulnerability of rural workers in developing countries. It emphasizes the little access they have to social security and their precarious living and working conditions.
The fact that most of these workers are freelance means that they are usually unable to afford social security.
Finally, the document presents a number of proposals made by the local community and the ILO to counteract this vulnerability.

This document analyses the evolution of the Argentinean textile sector from the nineties to the present. It particularly focuses on the impacts of the convertibility plan of the nineties and the changes in trade policy concerning the organisational evolution of this sector and the performance of the enterprises that belong to it (in terms of its dynamism in productivity, products, employment, investment and exports).
The nineties brought further organisational flexibility for enterprises. But it also brought about a major increase in informal employment and informal productive units, which are the consequences of the adjustments made by this sector in response to the changes in the context.
Finally, possible policies are discussed which intend to improve the sector's competitiveness and bring some formality to informal productive units and workers through training, tax and credit policies.

This paper takes the importance of employment and investment as the starting point of economic growth.
It presents the evolution, achievements and difficulties of the State's action between 1996-2000 in the promotion of productive employment and education for work. It also presents the actions taken by the entrepreneurial sector and private investment, small and microenterprises, together with their role in the demand to fulfil their functions, which calls for the application of the efficiency and priority criteria.

Llamas Huitron, I. Informalidad en América Latina: educación y grupos sociales más vulnerables. (Informality in Latin America: education and most vulnerable social groups). In: López N.; Pereyra, A. (Coord.) Educación y mercado de trabajo urbano. (Education and urban labour market). Buenos Aires: UNESCO.IIPE, 2005. p. 12-33. (Debate, 2) p.11

This paper studies the effects of regulation on economic growth and the relative size of the informal sector in a large sample of industrial and developing countries. Along with firm dynamics, informality is an important channel through which regulation affects macroeconomic performance and economic growth in particular. The paper concludes that a heavier regulatory burden - particularly in product and labour markets - reduces growth and induces informality. These effects are, however, mitigated as the overall institutional framework improves.

This study started from the view that informal economies arise when governments impose excessive taxes and regulations that they are unable to enforce. The research studied the determinants and effects of the informal sector in an endogenous growth model whose production technology depends essentially on congestable public services. The model concluded that changes--in both policy parameters and the quality of government institutions--that promote an increase in the relative size of the informal economy will also generate a reduction in the rate of economic growth.
Using data from Latin American countries, it concludes that the size of the informal economy will depend positively on proxies for tax burden and labour market restrictions and negatively on the quality of government institutions, which has a negative impact on the economic growth of countries.

Mejía Flores, R. Conferencia: Mujer y Trabajo Informal en México. (Conference: Women and Informal Labour in Mexico). Mexico: Secretary of Economic Development. Social Development Fund; ENEP Acatlán, UNAM, 2003.

The increase in the amount of people taking up atypical jobs and the State's withdrawal from training for work have raised the question of how the workforce of such jobs gets training.
On the basis of the available statistics, a typology was elaborated with the cases corresponding to the different types of jobs observed in Chile. In-depth interviews were conducted in each case.
The material gathered allows to put forward the hypotheses of human resources training mechanisms. It also allows to identify the deficiencies of the role of enterprises and the State in terms of training financing and competency acquisition.

Moraes, Eunice Léa de. Relação gênero e raça na política pública de qualificação social e profissional. Brasilia: MTE, SPPE. DEQ, 2005. 39 p. - Construindo identidades sociais; v. 1. Coleção Qualificação Social e Profissional.

This article intends to address the relationship between gender and race in vocational training from the basis of the new National Qualification Plan. The categories of gender and race begin to have a different role in public policy for the present government. In 2003, the government created two important secretaries: the Secretaria Especial de Políticas de Promoção da Igualdade Racial (SEPPIR) and the Secretaria de Promoção da Mulher, thus addressing the historical claims of women's and black people's movements for the sustainable promotion of race and gender equity.

MTEySS. Trabajo, ocupación y empleo: relaciones laborales, territorios y grupos particulares de actividad. (Work, occupation and employment: labour relations, territories and specific activity groups). Buenos Aires, 2005. (Estudios, 3)

IOE.The Informal Economy - an Employers' Approach. 2001

Oliva Alonzo, R. (Coord.) Trámites, costos, tiempo y dificultades que deben enfrentar los empresarios del sector informal para incorporarse al sector formal de la economía guatemalteca. (Proceedings, costs, time and difficutlies encountered by entrepreneurs of the informal sector to enter the formal sector of the Guatemalan economy). Guatemala: University of San Carlos de Guatemala (USAC); Guatemalan Programme to Support the Informal Sector (PROSIGUA), 1999.

This field research intends to inform about the offices where enterprises can be legally registered in Guatemala, the proceedings to be followed, requirements to be fulfilled and the times and costs to be assumed. It also seeks to determine the main reasons why many entrepreneurs remain in the informal sector of the economy. With the purpose of establishing the possible reasons, the field research deemed it necessary to base itself on some interviews to micro entrepreneurs.

In order to achieve these objectives, two types of written instruments were prepared: interview pads and observation guides. All in all, seven instruments were used. These are enumerated here together with the results obtained by using them and their interpretation.

Pérez Herrera, G. Mujer, mercado de trabajo e informalidad. (Women, labour market and informality). Article 2.2 In: Pérez Herrera, G. Sector informal y sindicalismo en América Latina. (Informal sector and trade unionism in Latin America). Proyecto Educación y organización para la acción en el sector informal (Project on Education and organisation of actions in the informal sector) - EOASI CIOSL - ORIT/FNV. Article 2.2

Pérez Ruiz, A. El comercio informal: una respuesta ante la crisis. (Informal trade: a response to the crisis). Online workers. v. 6, n. 29, Mar-Apr. 2002.

Pok, Cynthia. 2001. La Medición del Sector Informal en Argentina. (Measuring the informal sector in Argentina). Background Paper for the Latin American Regional Workshop on Statistics in the Informal Economy, October 2001.

Portes, A.; Haller, W. La economía informal. (The informal economy). Santiago, Chile: ECLAC, 2004. (Social Policies, 100)

The objective of this paper is to analyse the way in which the activities developed by informal enterprises interact with the existing social structures and the control practices and policies of national States. After analysing several possible definitions and measure approaches, the paper concentrates on these dynamic factors which focus on four paradoxes: the social principles of informal economy; the ambiguity of the relationship with State regulations; the difficulty to define it; its functionality regarding the economic and political institutions it is believed to undermine.

Riquelme Peña, M.; Munizaga, J.C. Percepción de su identidad, del SENCE y la capacitación por parte de microempresarios y trabajadores independientes. (Perceptions on its identity, SENCE and training by micro entrepreneurs and freelance workers). Cuadernos de Estudio N°1. Santiago, Chile, February 2005.

The objective of this paper is to get familiarised with the needs of micro entrepreneurs and freelance workers and draw up a basic "brief" to call for tenders of an advertising campaign that promotes the training demand in this sector. It is a descriptive study that aims at qualifying and specifying some of the characteristics of the group of micro entrepreneurs and freelance workers. This research is not empirical since the phenomenon will be observed as it takes place in its natural context without the manipulation of variables.

Rodrik, D. ¿Por qué hay tanta inseguridad económica en América Latina? (Why is there such economic insecurity in Latin America?) ECLAC Magazine. Santiago, Chile, ECLAC. N. 73, 2001.

The author holds that economic insecurity in Latin America has multiple aspects and comes from sources that feed reciprocally. Part of such insecurity stems from the declining employment protection and an increasing volatility of home income. It is partly due to the erratic flows of capital and the systemic instability generated by the separation between stabilisation instruments and the real economy, and partly due to the weakness of expression (voice) and representation institutions.

It suggest the need to add macroeconomic policies to social protection programmes that contribute to the stability of the real economy. In addition, it is necessary to have access to representative institutions - trade unions, political parties and legislative bodies - with more sensitivity and legitimacy. It concludes that what Latin America probably needs the most is a vision on how to maintain social cohesion as opposed to inequality and volatile results, both worsened by a growing trust in market forces. This vision softens the tension between market forces and the yearning for economic security.

Singh, M. (Coord.) Meeting basic learning needs in the informal sector: integrating education and training for decent work, empowerment and citizenship. Dordrecht: Springer; UNEVOC, 2005. 250p. (Technical and vocational education and training series, 2)

The aim of this volume is to provide accounts of learning and training programmes in the informal sector that range over the vast territory of educational activity and give young people and adults an opportunity to gain the knowledge and develop the values, attitudes and skills which will enable them to improve their capacities to work, participate fully in their societies, take control of their own lives and continue learning. The programmes are significant in that they attempt to integrate education and training. Special emphasis is placed on the participation of all stakeholders, especially civil society organisations and social movements.

Tokman, V. Integrating the informal sector in the modernization process. Development Forum on Productive Employment and Decent Work. UN Department of Economic and Social Affairs, 8-9 May 2006

Veleda da Silva, S. M. Trabajo informal, género y cultura: el comercio callejero e informal en el sur de Brasil. (Informal work, gender and culture: street commerce and informal trade in the South of Brazil). Barcelona: Universidad Autónoma de Barcelona, 2003.

This paper intends to examine the situation of street vendors in Brazil from the starting point of the analysis of their work and family situation.
Street vendors are described according to sex, age, place of birth, schooling, profession, marital status, number of children, type of family, spouse's profession and individual and family income.
This description will allow to study the relationship 'precarious job - place - family' from a cultural and gender perspective, focusing on the possibility that this relationship may lead to the production and reproduction of new identities based on the occupation of public spaces.

Vianna da Cruz, J.L. Trabalho, Renda e Desenvolvimento Local: Algumas Questões. In: Boletím Técnico do Senac. Rio de Janeiro, SENAC. v.25, n. 27, 1.

This article intends to approach the complexity of the analysis on the potential proposals and practices of Local Economic Development (LED) as means of tackling the historical challenge of generating jobs and income in Brazil.
LED has emerged during the last decades as a means to give value to work, citizenship, integration and equity, both in developed countries and underdeveloped ones.
It is based on low-income micro and small enterprises, where the agreement among local actors has particular importance. It implies new ways of production, where these enterprises can form networks in order to achieve further innovation, competitiveness and complementarity. All of this based on the community, where the territory acquires importance and cultures, values and the own identity can be rescued, and new institutions can be engaged in new ways to obtain credit and offer training and research.

Yannoulas, S. C. Perspectivas de género y políticas de formación e inserción laboral en América Latina. (Gender perspectives and training and labour insertion policies in Latin America). Buenos Aires: Red Etis: IIPE: IDES, 2005. 58 p. (Trends and debates; 4)