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Informal Employment in Indonesia

Author

Listed:
  • Cuevas, Sining

    (Asian Development Bank)

  • Mina, Christian

    (Asian Development Bank)

  • Barcenas, Marissa

    (Asian Development Bank)

  • Rosario, Aleli

    (Asian Development Bank)

Abstract

The paper attempted to use the February 2007 round of Indonesia’s National Labor Force Survey (Sakernas) for a comparative analysis of wages and benefits of formal and informal workers. While Sakernas was not designed for this purpose, the study explored questions in the existing survey that can be used to distinguish formal and informal workers. Because of data limitation, workers were classified as employed informally or “mixed”—a category composed of workers who cannot be identified, with precision, to be engaged in either formal or informal employment. Given this constraint, informal employment was estimated at the minimum to be at 29.1% of total employment in Indonesia. Informal employment is also highly concentrated in rural areas and is prevalent in agriculture and construction sectors. More women are likely to be informally employed than men, and women generally receive lower pay and are mostly unpaid family workers. To the extent possible the study was able to examine informal employment in Indonesia and to identify the gaps in the Sakernas questionnaire that can be addressed in future rounds of the survey for a successful comparative analysis between formal and informal workers.

Suggested Citation

  • Cuevas, Sining & Mina, Christian & Barcenas, Marissa & Rosario, Aleli, 2009. "Informal Employment in Indonesia," ADB Economics Working Paper Series 156, Asian Development Bank.
  • Handle: RePEc:ris:adbewp:0156
    as

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    File URL: http://www.adb.org/Documents/Working-Papers/2009/Economics-WP156.pdf
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    Cited by:

    1. Mina, Christian D., 2013. "Employment of Persons with Disabilities (PWDs) in the Philippines: The Case of Metro Manila and Rosario, Batangas," Discussion Papers DP 2013-13, Philippine Institute for Development Studies.
    2. Rothenberg, Alexander D. & Gaduh, Arya & Burger, Nicholas E. & Chazali, Charina & Tjandraningsih, Indrasari & Radikun, Rini & Sutera, Cole & Weilant, Sarah, 2016. "Rethinking Indonesia’s Informal Sector," World Development, Elsevier, vol. 80(C), pages 96-113.
    3. Christian D. Mina & Katsushi S. Imai, 2017. "Estimation of Vulnerability to Poverty Using a Multilevel Longitudinal Model: Evidence from the Philippines," Journal of Development Studies, Taylor & Francis Journals, vol. 53(12), pages 2118-2144, December.
    4. Landau, Ingrid. & Mahy, Petra. & Mitchell, Richard., 2015. "The regulation of non-standard forms of employment in India, Indonesia and Viet Nam," ILO Working Papers 994888153402676, International Labour Organization.
    5. Ximena Del Carpio & Ha Nguyen & Laura Pabon & Liang Wang, 2015. "Do minimum wages affect employment? Evidence from the manufacturing sector in Indonesia," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-30, December.
    6. Tabuga, Aubrey D. & Mina, Christian D. & Reyes, Celia M. & Asis, Ronina D. & Datu, Maria Blesila G., 2011. "Persons with Disability (PWDs) in Rural Philippines: Results from the 2010 Field Survey in Rosario, Batangas," Discussion Papers DP 2011-06, Philippine Institute for Development Studies.

    More about this item

    Keywords

    Indonesia; informal employment; informal sector; gender analysis; wage differentials;

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