Informal Employment

There is a fifth sector but it not recognised in the official figures produced by governments. This is called the informal sector, also referred to as the 'black economy' in the sense that it is unofficial and unregulated. This sector employes millions of people across the world, mainly in LICs.

In LICs today large numbers of people are migrating from rural to urban areas. The quality of life is better in towns and cities.







Characteristics

Might involve selling matches or shoelaces on the street, ice-cream vending, shoe shining, rubbish collecting or scavenging bottles, cans and other types of waste recycling. Some are do desperate as to resort to begging, petty crime or prostitution. Common features of LIC urban areas are shanty towns.

An interesting group of informal activities fall under the heading of Paratransit. these arise because of the inadequate official transport in LIC towns and cities. They usually take the form of minibuses, hand-drawn and motorised rickshaws, scooters and pedicabs (tricycles used as taxi's).They add to the problems of congestion, on already busy, overloaded roads. These informal activities have some benefits. they provide a wide range of cheap goods and services that would otherwise be out of reach of many people. They provide the poor with a means of survival. Because earning are low, informal activities do nothing to break the cycle of poverty in LIC urban areas. Other costs with the informal sector include:

• no health care or unemployed benefits
• a high exposure to work-related risks
• an uncertain legal status

The involvement of children in economic activity:

In Dhaka, the capital of Bangladesh, it is estimated that there are half a million children in the informal sector, most of them work from dusk to dawn earning on average of 50 cents a day to help them support their families. The jobs range from begging and scavenging. These children work in vulnerable conditions, exposed to hazards such as street crime, violence, drugs, sexual abuse, toxic fumes and carrying excessive loads. The children suffer poor health in theses conditions.