Paid Informal Work in Deprived Neighborhoods

Abstract

In advanced economies, work beyond employment has been viewed very differently depending upon whether it is paid or not. Whilst unpaid work, especially voluntary work, has been perceived as something to be nurtured in order to rebuild trust and reciprocity in communities, paid informal work has been viewed as exploitative work conducted under sweatshop conditions that needs to be eradicated. Using evidence from deprived urban neighborhoods in Britain, however, this paper reveals that only a minor part of paid informal work involves exploitative social relations. Instead, most paid informal work is conducted on a voluntary basis for kin, neighbors and friends for social rather than economic reasons. In consequence, much paid informal work is conducted under social relations akin to the unpaid community exchange that many wish to nurture. The consequent policy finding, however, is not merely that a more laissez-faire approach is required towards such work. Given that the poorest benefit least from such informal exchange, this paper asserts that the challenge for policy is to identify vehicles for harnessing it amongst such groups. The paper thus concludes by outlining one potential means - Active Citizens' Credits - by which this might be achieved.

Keywords: informal employment, informal economy, informal sector, cities, urban studies, underground economy, shadow economy

JEL Classification: O17