economics

Economics

The informal sector of the economy primarily consists of people belonging to the lower strata of society . Usually , women play the vital role for the continuous growth in globalization . Prior to globalization women are considered as one of the major parts of the informal sector since caretaking and informal work is considered almost equal to or synonymous with reproductive work . In a position made by Homenet Southeast Asia , women are deprived of the opportunities of formal work considering that they are considered inferior to men

But today , the informal sector

of society consists of both males and females that can usually be seen on the streets selling different kinds of products . The informal sector is considered the primary provider of employment to most people within the lower class . These can be done as an alternative to earn a decent measly income while no job opportunity is available . However , employment in the informal sector is lowly organized . In this regard , economic contribution would be measly to cover the development of the sector

Although the informal sector comprise of about 50 to 60 percent of the workforce in many south-east and south Asian cities , there are disadvantages that come along an individual who decides to be involved with this sector

One of the disadvantages posed in an informal sector is that there has been no productivity of the activities since there involve basically poor working environment and as well as methods . This is manifested by the fact that most people involved in this sector are inadequately educated . With no formal schooling , these workers lack the necessary basic skills needed for their business to develop . Also , they do not have access to a hygienic and safe environment to effectively serve the needs of their consumers . As a result , they tend to neglect the welfare of their consumers , sacrificing the quality of products to be sold Another drawback that comes along this sector is the inadequate access to financial lending institutions that would help the operators /business owners to establish even a small scale business which could be of help to their measly income . To illustrate , only over two (2 ) percent of operators in the informal sector within the Philippines were able to obtain funds from lending institutions . The reason for this is that many of the lending institutions could not see any advantages from lending money to the small business as it entails barely smaller interest . As a result , the operators would eventually make use of outdated machinery causing the products to be defective . Lastly , legislative measures seem to impede business establishment . Many small-time business operators from the informal sector do not like to sacrifice their very little income to undergo costly procedures such as acquiring a legal status Small-scale entrepreneurs seem to choose informal sector because they wanted to escape the lengthy legal requirements and bureaucratic procedure

The informal sector has been largely contributing on a particular employment generation . According to an estimate , there are more than 60 percent of...