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Informal sector

In a nutshell

The informal sector comprises market production units that are often small, unincorporated and insufficiently registered.

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Explained simply

The precise criteria depend on national statistical definitions. Informal activity is not necessarily illegal activity.

A practical example

Hypothetical example: a family workshop sells repair services without registration or complete accounts; it may fall within the informal sector under the criteria used.

Further reading

Source: ILO — Informal enterprises.

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What this means

A market workshop without registration or complete accounts may fall within the informal sector, depending on statistical criteria.

Educational scenarios. Amounts and rates are fictional, not current market conditions.

Does informal necessarily mean illegal?

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