Informal Workers: Poor, Insecure, and Prevalent in the Tunisian Economy

20 Feb 2015
  •  Informal Workers: Poor, Insecure, and Prevalent in the Tunisian Economy

A large number of Tunisians work illegally in the informal sector, where their lives are defined by instability, poverty, and risk. A new study attempts to shed light on this vital facet of the Tunisian economy, and reveals that many of these workers lack knowledge of how to legitimize their work and gain access to public benefits.


Informal workers are present in every sector of the Tunisian economy, ranging from construction site workers to housekeepers, from agricultural laborers to office workers.


The report, released June 18, is based on a survey of people living in Tunis, El Kef, Kasserine, Gafsa, Sfax, and Medenine. Its authors sought to provide a deeper understanding of informality in Tunisia that goes beyond the more publicized issue of street vendors.


Informal employment is a “a phenomenon that has been widely visible, especially after the revolution, but it is very difficult to measure or discern,” according to Tarek Lamouchi, a project coordinator at the Global Fairness Initiative, which prepared the study in cooperation with the Tunisian Association for Management and Social Stability (TAMSS) and Partners for Democratic Change.


A defining aspect of the typical informal worker’s life is a lack of security and stability, according to Nidhal Ben Cheick, an informal economy specialist and CEO of the Center for Research and Social Security studies. Work in the informal sector implies poverty, underemployment, and social instability.


“Informal workers do not have a back-up plan in case of decreased revenues, non-payment of wages, compulsory overtime or extra shifts, lay-offs without notice or compensation, unsafe working conditions, and the absence of social benefits such as pensions, and health insurance, and retirement,” Ben Cheick told Tunisia Live.


“It is a denial of basic social rights according to the International Labor Organization. This comes in period of transition, when the state’s position is weakened and imposing the rule of law becomes a challenge,” Ben Cheick said.


“But the problem of dignity is the most recurrent, as most of them [informal workers] feel that despite having income, their dignity is incomplete because of the constant threats to their social stability,” stated Lamouchi.


According to the World Bank, 38 percent of Tunisia’s GDP comes from the country’s informal economy.


“This huge figure means that these individuals are unable to access to health care, social security, and [have] no knowledge on the process of getting into the formal sector” expressed Imed Fattah of the UGTT labor union.


Informal workers are poor. Over three-quarters of informal employees earn less than 200 dinars (about $130) per month, according to the study, which is far below the minimum wage of 320 dinars per month. 39.5 percent of informal workers are self-employed.


There are many women working informally. 30 percent of the informal workers surveyed are women, and women’s participation in the informal sector actually exceeds their participation in the formal sector.


Informal workers are generally not well-educated, but there are exceptions. While more than half have not exceeded a primary level of education, 11.3 percent have attended college and 32 percent have a vocational certification.


“These are very alarming figures, because now even educated individuals are working outside the law,” said Chema Gargouri, president of TAMSS.


Just over half (51.3 percent) of those surveyed were formally employed prior to starting their informal work, while 67.4 percent had at some time been previously employed in the informal sector. 70 percent of current informal workers had looked for a job for more than two years before turning to informal work.


A lack of information is key to keeping workers out of the formal sector, according to the report.


The vast majority of informal workers surveyed were completely unaware of the avenues by which they could formalize their status and gain access to social security resources.  Only 12 percent were aware of the procedures necessary to legitimize their work, and over 90 percent have no knowledge of minimum wage employment contracts and Tunisian labor laws. [display_posts type="same_author" limit="3" position="right"]


The overwhelming majority, fully 90 percent, of independent workers do not even try to register their business officially. Over a third of workers consider bureaucracy (36.2 percent) and nepotism (33.4 percent) to be major barriers to formalization. Some incentives for entering the formal sector were cited, however, including access to financing, lower taxes, and support for registering their business officially.


This demonstrated lack of access to information is guiding new initiatives orchestrated by the organizations that produced the report. They will seek to facilitate informal workers’ knowledge of and comfort with the necessary bureaucratic procedures to legitimize their work.


“Explaining and simplifying the legal procedures will be our main focus for our pilot project, as most of them freak out whenever they see papers or legal documents,” said Gargouri.


“In our diagnostic, we had a multi-stakeholder approach for determining how to deal with informality. We had the Ministry of Vocational Training and Employment, the UTICA, the UGTT ” stated Gargouri


The second phase of the project is to take a sample of 100 self-employed workers from informality to formality in partnership with the Ministry of Vocational Training and Employment.


“This is mainly to determine whether the current legal framework, with all its mechanisms and incentives, is currently sufficient to deal with the problem of informality,” said Gargouri.


“Unfortunately, Tunisian legislation is not up to date and is not keeping up with socioeconomic changes, and the laws have to be adapted to our Tunisian reality.”


“We are not dealing with criminal informality, but we are dealing with individuals who have to work outside the law,” Gargouri said.


“Some of them make this choice in order not to lose the privilege of working in the public sector” he added, explaining that workers who wish to work in the public sector are not allowed to hold private jobs. They will do their work informally to stay officially eligible for public sector work.


However, despite all the negative aspects of informality, the basic fact remains that informal work provides poor and unemployed Tunisians a way to survive and support their families in the face of Tunisia’s current economic woes, concluded Ben Cheick.


By Salma Bouzid | Published on Tunisia Live | July 3, 2013

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