The Illegibility of the Informal Sector

Malang-based Mitra Wanita Pekerja Rumahan Indonesia (MWPRI) (Partner of Female Workers in Home Industries) has made its way into the press, with very similar articles in The Jakarta Post this week and Jawa Pos earlier this month regarding the government’s uneven recognition of workers in the informal sector:

“The government seems to ignore their existence. Although there is much stimulus funding allocated to the informal sector, it never reaches this kind of worker,” Ratno [Cahyadi, chairperson of MWPRI research and legal division] told The Jakarta Post on Sunday.  She added the government only recognized those who worked independently in the informal sector.  “So those who work for employers in the informal sector are not recognized in the manpower law.”

Ratno said Manpower and Transmigration Minister Erman Suparno had guaranteed that Manpower Law No. 13/2003 would protect formal and informal workers, but the ministry has so far only recognized those who doing informal jobs, instead of workers in the informal sector.

“The uncertainty in the definition of informal workers had entrapped millions of people in ‘modern slavery’. Workers in the informal sector do not have a standard minimum wage, work safety rules or health benefits. Unpaid workers and child labor exploitation are also rampant in the sector,” she said.

What Ratno Cahyadi describes in The Jakarta Post is an informal sector that can be divided into various categories of employment and self-employment, while a recent International Labor Review article on the informal sector looks at the idea of dividing the informal job market into “voluntary,” upper-tier informal work and “involuntary,” easy entry informal work.  All of which aligns with the ILO’s 2002 report on the informal sector, which stated that “Increasingly, ‘informal sector’ has been found to be an inadequate, if not misleading, term to reflect these dynamic, heterogeneous and complex aspects of a phenomenon which is not, in fact, a ‘sector’ in the sense of a specific industry group or economic activity.

Coupling this heterogeneity with the difficulties in quantifying the informal sector mentioned in the Jawa Pos article and the fact that the “informal sector” made up over 60% of the Indonesian workforce in 2007, we begin to get a picture of the breadth of complexities groups like Mitra Wanita Pekerja Rumahan Indonesia (MWPRI) are up against in pushing for policy solutions.


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