Question

How will you know whether a worker is working in the informal sector?

Answer 1

All workers working in those enterprises other than the public sector establishments and those private sector establishments which employ 10 hired workers or more are working in the informal sector. Thus, the informal sector includes millions of farmers, agricultural labourers, owners of small enterprises and people working in those enterprises as also the self-employed who do not have any hired workers. All non-farm casual wage labourers who work for more than one employer such as construction workers and headload workers are also working in the informal sector.

Those who are working in the informal sector do not enjoy social security benefits. They earn less than those in the formal sector. Workers and enterprises in the informal sector do not get regular income; they do not have any protection or regulation from the government. Workers in the informal sector are dismissed without any compensation. Workers of this sector are even found living in slums.