The informal economy consists of independent, self-employed small-scale producers and distributors of goods and services. Workers in this sector are for the most part not covered by the country’s labour laws and regulations. Proxy measurement and related indicators for the informal economy include the vulnerable employment rate, defined as the share of own-account and contributing family workers in total employment.
In the Philippines, the Labor Force Survey data indicated that 38.3 per cent of those employed are in vulnerable forms of employment. This means nearly two out of five workers are less likely to have formal work arrangements and access to social protection and are more at risk during a crisis or shock.
The ILO promotes R204 - Transition from the Informal to the Formal Economy Recommendation, 2015 (No. 204) adopted at the ILC's 104th Session (2015) based on strong tripartite consensus and near unanimous vote. This new Recommendation is of strategic significance for the world of work and for the future of work: it concerns half of the global labour force and more than 90 percent of small and medium enterprises worldwide who are working and operating in conditions of informality. In recent years, the use of technology is increasingly becoming a key element of the integrated approach to formalizing the informal economy, which is sometimes referred as "e-formalization" or "e-formality".
The ILO Country Office for the Philippines (CO-Manila) has carried out research and programmes to better understand informal work. Since the adoption of R204 in 2015, CO-Manila has been intensifying its support to the constituents on the promotion of the Recommendation, organizing awareness-raising workshops and South-South experience sharing, facilitating the participation of the constituents at the regional and international fora, and providing technical inputs at the policy dialogue such as the five-cluster dialogue on enterprise formalization which started in 2019 on the basis of the learnings of the South-South forum of 2018. In collaboration with the Department of Labor - Bureau of Working Conditions (DOLE-BWC) and National Anti-Poverty Commission (NAPC), ILO has been engaged in the regional rollout of R204 of the selected Regional Development Councils (RDCs) across the country since 2018.
The office also works with specific categories of workers in the informal economy specifically through the ongoing Assessment Based National Dialogue (ABND) towards establishing a Social Protection Floor as well as the Domestic Workers project, in order to strategically support the growing sector, enhance their role as contributors to the economy and provide such workers with the legitimacy and protection accorded other types of workers.
- Social security needs assessment survey for the informal economy in the Philippines
- Informal economy
- Enterprise Formalization
- Experiences from Simples National, the monotax regime for own-account workers, micro and small entrepreneurs in Brazil
- Formalization in Chile
- BWSC, NAPC, ILO conduct roll-out of ILO R204
- NERS for the Workers in the Informal Sector