Advantages And Disadvantages Of Informal Employment

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As we all know, we live in a formal economy which regulates for the working hours, duties, responsibilities, conditions of work etc. This in return helps companies and employees to track the salaries easier, ensure that human rights are being respected and helps for a better function of the market. The market is a platform of production, allocation and distribution of resources in order to ensure efficiency in using those products since there is an abundance of resources in the world and an efficient utilizing mechanism should be created for them. As a result, countries have created rules and regulations through which they organize the market and the economy of each country, therefore, we can say that the majority of the countries have formal…show more content…
Some of the characteristics of informal employment include: low wages, lack of contract, no working hours policy, weak conditions of health and safety, uncomfortable housing etc. Earnings are unstable and irregular, since the employers pay according to the availability of funds and there is no mechanism to force them to give the wages on time. Lack of contract is the major implication of informal employment because it is the mechanism that regulates for responsibilities, human rights, hours worked etc. Not having a contract allows any party to impose different rules on employees which then questions the compliance with human rights and leads to exploitation of workers. In the other hand, since payment is calculated according to hours worked, people are forced to work longer hours due to low payment and in return this activity causes inequality and breaks the rules for working hours set by the government. People who work long hours have no time to spend on other life activities which soon becomes a burden that decreases their happiness and

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