Tucked away behind the very public picture of the formal U.S. labor market, millions of workers participate daily in a vast, yet almost invisible financial sector: the “informal” economy.
From nannies and gardeners working in suburbia, to street vendors and restaurant employees laboring in large cities, these individuals and entrepreneurs frequently operate outside the traditional labor market, providing for their families and making significant — if often hidden — contributions to national productivity.
Two recent reports, funded by the Charles Stewart Mott Foundation, offer insights into this complex labor environment:
This report, produced by the Microenterprise Fund for Innovation, Effectiveness, Learning and Dissemination (FIELD), examines the informal economy experiences of 38 New Jersey and New York area Latinos – including undocumented immigrants — participating in a wide range of small-scale, income-generating activities. The report also considers implications for related practices and policies, and explores the barriers that Latinos face in stabilizing and growing their businesses in the informal economy.
Examining the attitudes and behaviors of 55 African-Americans who either operate informal businesses or work within the informal economy is the focus of this report by the Institute for Social and Economic Development Solutions. The study, which looked at participants working in Chicago and Baltimore, explores the reasons that people engage in the informal economy, the advantages and disadvantages of doing so, and the implications for microenterprise development programs.
Publication of a third book in this series, focusing on informal enterprises operating in rural America, is expected in 2004.