formal and informal sectors


Polish, Poland
Field and topic: Development policy: I am not sure how to define formal and informal sector? Does it refer to paid and unpaid job, or rather legal and illegal respectively?
I'd be grateful for any hints.
Sample sentence: In most countries, women and men are distributed differently across
manufacturing sectors, between formal and informal sectors, within agriculture,
and among occupations.
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  • lauranazario

    Senior Member
    Español puertorriqueño & US English
    Hi Monaka.

    In ANY economy, there are "formal" and "informal" sectors.
    The formal sector is comprised of people who are employed by a bona fide company, pay taxes, etc.
    The informal sector is comprised (among others) of people who are self-employed in the labor and service areas and certain types of entrepreneurs (mostly small-scale vendors). Since these people basically work for themselves (and most of the time state taxes are not deducted from their wages), they are not part of the country's mainstream economy.
    Now, the informal sector of any economy does indeed include people who are involved in illegal activities... but I would not go as far as to say ALL members of the informal economy are behaving illegally. In my view that would be gross oversimplification.



    Senior Member
    Por lo general, formal/informal sector se refiere a aquellos empleados en relación de dependencia (formal) y pagan impuestos y a quienes trabajan de manera independiente, que no siempre están contenidos en el sistema legal. Fijate cómo viene el contexto.
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