Informality and social protection Preliminary findings from the 2015 Living Conditions and Monitoring Survey Dr Caroline Tassot OECD Development Centre

Introduction High levels of informality are an important challenge for social protection systems This work aims at supporting policy choices in SHI and other social protection reforms and developments, in particularly regarding extension of (contributory) mechanisms to the informal sector workers Expansion of social protection requires better understanding of informal worker characteristics and needs, in order to answer questions such as could informal workers contribute to health insurance? Who would need to be subsidized?

Defining informal work ILO guidelines Informal employment = all informal jobs, whether carried out in formal sector entreprises informal sector enterprises households

Informal employment definition Status in employment Employers; own-account workers; members of cooperatives Employees Contributing family workers Yes Social security (employment related social security) No DK/NA Economic unit (enterprises) Informal sector Formal sector Households No production for sales or batter Paid annual leave Yes No Paid sick leave Yes DK/NA or No Formal employment Informal employment

Informal employment in developing countries . Source: ILO calculations based on national household surveys

Data for the study Living Conditions Monitoring Survey 2015 and Labour Force Survey Representative of Zambian population (at national, provincial, and urban/rural levels)

Population Employed (43%, including wage employed, farming, fishing, forestry, piece work, unpaid family workers) Employees (27.6%) 60% informal Employers (0.6%) 94.4% informal Own-account workers (64%) 99% Unpaid family workers (7.4%) 100% Not working (students, retirees, unemployed, homemakers)

77% of urban workers are informal 89% of all workers are informal 97% of rural workers are informal

Location of informal workers

Location of informal workers

Size of the bubble represents number of informal jobs in 2014 in the industry

Slides excluded works in agriculture and activities of households as employer Rural Urban

Informal workers demographics

Informality & education

Informality & income

Informality & poverty

Informality & poverty

Informality & poverty Extremely poor Moderately poor Non poor Number of workers

Degree of informality

Informality & health

Informality & health

Identifying profiles of informal workers

Conclusion These are preliminary results Current results already outline interesting differences between informal workers Next steps include: a more detailed analysis of healthcare demand, use, spending, willingness to pay Final results by Q1 2018

Back up slides

Employees (27.6%) of which 60% informal Population Non workers Workers Employees (27.6%) of which 60% informal No social security Informal With social security Formal Unclear SS Paid annual leave No paid annual leave Employers (0.6%) of which 94.4% informal / Own-account workers (64)%), of which 99% informal Government / NGO / IO Households More than 5 employees Less than 5 employees Private Less than 5 e,[;puees Unpaid family workers (7.4%) of which 100% informal

Informal sector Key variables Employment in the formal sector Institutional sector Government, Corporations, NGO, IO etc Private household Farm or private business (unincorporated) Other, DK, NA, Not asked Destination Only for own final use At least partly for the market Other, DK, NA, Not asked Bookkeeping Keeps accounts for reporting to the Government Does not keep accounts Other, DK, NA, Not asked Registration Registered at national level Not registered at national level Other, DK, NA, Not asked Status in employment Employees Other Social security contribution or tax on wages Yes No Place of work Other Non-fixed premises Households (producing exclusively for own final use) Q6. Size 6 or more, other 5 or less Employment in the formal sector Employment in the informal sector