The Characteristics of the Informal Sector in Timor-Leste

This study analyzes the characteristics of people working in the informal sector in Timor-Leste. We use primary data, collected from the field between January and early May 2017. A stratified random sample was used to draw a sample of 349 households, with a total of 658 adult respondents, from 38 Census Enumeration Areas in Dili and surrounding districts. A logistic regression model was used to identify the factors associated with informal sector participation. The analysis shows that 65.8 percent (n = 405) of individuals in our sample were engaged in the informal sector, including a significantly higher proportion of women than men. Education was significantly lower among those employed in the informal sector than those not employed in the informal sector. Married people were more likely to engage in the informal sector, while having no education and living in an urban area were marginally significant. Gender disaggregation shows that the impact of no education and urban area are only statistically significant for women. Moreover, analysis of economic activities performed in the informal sector actors revealed a gender dimension in the specific informal sector activities that participants were involved in. Women play a major role in food and beverage retail, as well as weaving and plaiting activities. Males dominate in occupations such as construction and quarrying activities.