NSCB Resolution No. 15 - Attachment 1

OFFICIAL DEFINITION OF THE INFORMAL SECTOR

1.  Conceptual Definition

The informal sector consists of “units” engaged in the production of goods and services with the primary objective of generating employment and incomes to the persons concerned in order to earn a living.

These units typically operate at a low level of organization, with little or no division between labour and capital as factors of production. It consists of household unincorporated enterprises that are market and non-market producers of goods as well as market producers of services.

Labor relations, where they exist, are based on casual employment, kinship or personal and social relations rather than formal or contractual arrangements.

2.  Operational Definition

For statistical purposes, the informal sector shall refer to household unincorporated enterprises which consists of both informal own-account enterprises and enterprises of informal employers.

Informal own-account enterprises are household unincorporated enterprises owned and operated by own-account workers, either alone or in partnership with members of the same or other households which may employ unpaid family workers as well as occasionally/seasonally hired workers but do not employ employees on a continuous basis.

Enterprises of informal employers are household unincorporated enterprises owned and operated by own-account workers, either alone or in partnership with members of the same or other households which employ one or more employees on a continuous basis.

Particular cases that are excluded:

1. Corporations
2. Quasi-corporations
3. Units with ten or more employees
4. Corporate farms
5. Commercial livestock raising
6. Commercial fishing