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The facts behind data, the data behind facts. Hints for a reflection on informal employment in Central America and the Caribbean.

juillet 26, 2017

Last year I had the opportunity to travel around Central America. Inevitably, on many occasions, my attention was drawn to employment and decent work related issues. Although I was traveling for leisure, even as a tourist it wasn’t impossible to me not to wonder about the job situation of the many people whose life have crossed mine during my journey, people who have been providing me with different kind of services: bus rides, taxi rides, fresh cooked meals, table service, room service, tourist information, guided tours, etc. The list could be endless. However, since the very beginning of my trip, there was this one type of job that has always left me quite puzzled. I even don’t know what the specific or technical qualification for that job is, but basically it concerns those people who are in charge of putting your groceries into plastic bags when you are about to pay at the cashier of a big supermarket you have been shopping at, so that you don’t have to do it yourself. Before, I had never seen something like this in Europe, at least not in any of the country I had traveled to. Courtesy or manners ask that you leave a small tip for the person who has been kindly packing your purchases, but there is no formal requirement to do so, and nothing is said about how much money this person’s service is worth. Supposing that this person is not necessarily employed on a formal basis, and if yes, his/her employment conditions and guarantees are probably very poor, the very essential question to me every time I was shopping at a supermarket was: is this person receiving a proper salary? I couldn’t figure out if yes or no (and honestly I never dared to ask) but in a way I have always been doubtless about the fact that the income of this kind of workers depends in a very extensive way on the tips that daily customers leave them. Wondering about this specific case was for me the very beginning of a wide reflection on the general employment situation in this part or the word, and the concrete discovery that these are huge areas of the world where one word can almost describe it all. That world is: informality.

In order to understand more about this phenomenon, I went and dig for information and data about informal work in Central America. Among others sources, I found out that a few months ago, ECLAC (Economic Commission for Latin America and the Caribbean) and ILO (International Labour Organisation) published their first report of the year about the situation of employment in Latin America and the Caribbean. The report unfortunately points out a number of negative trends, such as increases in unemployment rates as a consequence of poor economic growth and decreases in employment rates, which very likely imply even more difficult times to come for the population affected by these dynamics. Nevertheless, this is also a case where I think that these indicators alone say very little about the condition of the people on the labour market, because they leave out a big part of the general picture that characterizes these people’s every day struggle for a living. In this particular case, there is one trend that is featured in the report and that I consider especially worrying. This is the decrease over the last year of the formalization of both new workers and informal workers in the region. Such dynamic is found to be uneven distributed, with registered employment growth having slowed down in Mexico, while having slightly improved in Guatemala, El Salvador, Nicaragua and Costa Rica. Nevertheless, neither such decrease nor such increase is part of more a consistent pattern over a larger range of time, showing off the quite unstable tendency that characterizes the formalization of informal employment in the region. This can be seen as a proof of the strong role played by informal employment, which is either slightly reinforced or marginally reduced according to economic convenience and opportunism, but never substantially under serious attack. Moreover, the report also points out that the number of formal jobs has been falling also in relation with the trend of increasing employment growth and concentration in the service sectors. Actually, it is well known that informality strongly characterizes employment in commerce and other services, where labour conditions are more precarious. Finally, another significant trend that deserves to be mentioned in this context is the increase in own-account work, where precarity is also very common and where informal labour conditions are reinforced during times times of economic slowdown. Unfortunately, the report does not go deeper into the exploration of the topic of informal work. However, the pieces of information provided about this latter give important hints of people’s struggle for a living in these regions of the world traditionally affected by economic hardship.

Of course, it must not forgotten that informal employment in Latin America and the Caribbean is a much complex phenomenon where many dimensions have to be taken into account. One of this is the gender dimension, with UN Women pointing out that women represent 59% of people in informal employment as a percentage of total employment. Likewise, while several studies show high rates of informality among immigrant workers, pointing out that migration is another crucial dimension of this problem, it is also shown that even in this case women are more affected than men. Accordingly, women, informal employment and migration is a whole topic that deserve to be trated in a future post.

Meanwhile, to download the report from ECLAC and ILO, please visit: http://repositorio.cepal.org/bitstream/handle/11362/41371/S1700341_en.pdf?sequence=1&isAllowed=y

To learn a bit more about data from UN Women on the topic of women in informal work, please visit:  http://interactive.unwomen.org/multimedia/infographic/changingworldofwork/es/index.html

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