Workforce facts for kids

Labour force participation rate

The workforce or labour force is a concept referring to the pool of human beings either in employment or in unemployment. It is generally used to describe those working for a single company or industry, but can also apply to a geographic region like a city, state, or country. Within a company, its value can be labelled as its "Workforce in Place". The workforce of a country includes both the employed and the unemployed (labour force).

Formal and informal

Workers leaving the Tampella factory in Tampere, Finland in 1909

Formal labour is any sort of employment that is structured and paid in a formal way. Unlike the informal sector of the economy, formal labour within a country contributes to that country's gross national product. Informal labour is labour that falls short of being a formal arrangement in law or in practice. It can be paid or unpaid and it is always unstructured and unregulated. Formal employment is more reliable than informal employment. Generally, the former yields higher income and greater benefits and securities for both men and women.

Informal labour

The contribution of informal labourers is immense. Informal labour is expanding globally, most significantly in developing countries. According to a study done by Jacques Charmes, in the year 2000 informal labour made up 57% of non-agricultural employment, 40% of urban employment, and 83% of the new jobs in Latin America. That same year, informal labour made up 78% of non-agricultural employment, 61% of urban employment, and 93% of the new jobs in Africa. Particularly after an economic crisis, labourers tend to shift from the formal sector to the informal sector. This trend was seen after the Asian economic crisis which began in 1997.

Informal labour and gender

Gender is frequently associated with informal labour. Women are employed more often informally than they are formally, and informal labour is an overall larger source of employment for females than it is for males. Women frequent the informal sector of the economy through occupations like home-based workers and street vendors. The Penguin Atlas of Women in the World shows that in the 1990s, 81% of women in Benin were street vendors, 55% in Guatemala, 44% in Mexico, 33% in Kenya, and 14% in India. Overall, 60% of women workers in the developing world are employed in the informal sector.

The specific percentages are 84% and 58% for women in Sub-Saharan Africa and Latin America respectively. The percentages for men in both of these areas of the world are lower, amounting to 63% and 48% respectively. In Asia, 65% of women workers and 65% of men workers are employed in the informal sector. Globally, a large percentage of women that are formally employed also work in the informal sector behind the scenes. These women make up the hidden work force.

According to a 2021 FAO study, currently, 85 percent of economic activity in Africa is conducted in the informal sector where women account for nearly 90 percent of the informal labor force. According to the ILO’s 2016 employment analysis, 64 percent of informal employment is in agriculture (relative to industry and services) in sub-Saharan Africa. Women have higher rates of informal employment than men with 92 percent of women workers in informal employment versus 86 percent of men.

Formal and informal labour can be divided into the subcategories of agricultural work and non-agricultural work. Martha Chen et al. believe these four categories of labour are closely related to one another. A majority of agricultural work is informal, which the Penguin Atlas for Women in the World defines as unregistered or unstructured. Non-agricultural work can also be informal. According to Martha Chen et al., informal labour makes up 48% of non-agricultural work in North Africa, 51% in Latin America, 65% in Asia, and 72% in Sub-Saharan Africa.

Agriculture and informal economic activity are among some of the most important sources of livelihood for women. Women are estimated to account for approximately 70 percent of informal cross-border traders and are also prevalent among owners of micro, small, or medium-sized enterprises (MSMEs). MSMEs are more vulnerable to market shocks and market disruptions. For women-owned MSMEs this is often compounded by their lack of access to credit and financial liquidity compared to larger businesses. However, MSMEs are often more vulnerable to market shocks and market disruptions. For women-owned MSMEs, this is often compounded by their lack of access to credit and financial liquidity compared to larger businesses.

Agricultural work