Opinion: The pandemic has shown that workers in the informal economy need a safety net, too


  • Christopher Sabatini

    Dr. Christopher Sabatini, is a senior fellow for Latin America at Chatham House, and was formerly a lecturer in the School of International and Public Affairs (SIPA) at Columbia University. Chris is also on the advisory boards of Harvard University’s LASPAU, the Advisory Committee for Human Rights Watch's Americas Division, and of the Inter-American Foundation. He is also an HFX Fellow at the Halifax International Security Forum. He is a frequent contributor to policy journals and newspapers and appears in the media and on panels on issues related to Latin America and foreign policy. Chris has testified multiple times before the U.S. Senate and the U.S. House of Representatives. In 2015, Chris founded and directed a new research non-profit, Global Americas and edited its news and opinion website. From 2005 to 2014 Chris was senior director of policy at the Americas Society and Council of the Americas (AS/COA) and the founder and editor-in-chief of the hemispheric policy magazine Americas Quarterly (AQ). At the AS/COA, Dr. Sabatini chaired the organization’s rule of law and Cuba working groups. Prior to that, he was director for Latin America and the Caribbean at the National Endowment for Democracy, and a diplomacy fellow with the American Association for the Advancement of Science, working at the US Agency for International Development’s Center for Democracy and Governance. He provides regular interviews for major media outlets, and has a PhD in Government from the University of Virginia.

The coronavirus pandemic has hit the developing world’s informal economy hard. Existing on the margins, with no access to social safety nets such as unemployment insurance and pensions, many of the 2 billion informal workers around the world were already barely keeping their heads above water before the lockdowns. One analysis estimated that 1.6 billion informal sector workers worldwide would suffer a 62 percent decline in income in the first few months of the crisis alone, with workers in lower-income countries projected to see their earnings shrink by 88 percent.

But the pandemic may finally bring a much-needed evaluation by governments and international financial institutions of their failures to effectively understand and address labor inequalities that have created a semipermanent marginalized, vulnerable underclass of global workers. This week’s meeting of the International Monetary Fund and the World Bank and ministers of economy and finance from all over world presents a perfect, near-post-crisis moment to consider their obligations to the plight of informal sector workers.

According to the International Labor Organization, in 2020 more than 2 billion people — or 62 percent of the global workforce — were employed in the informal sector, the bulk of them in the developing world. Eighty-five percent of the workforce in Africa, 59 percent of workers in the Asia Pacific and 53 percent of laborers Latin America work in the informal sector.

These workers not only bore the brunt of the covid lockdown measures, but they also were largely left behind by the stimulus packages that governments implemented. Many packages relied on tax relief, extended unemployment benefits or cash transfers that excluded many informal sector workers.

To read more, visit the Washington Post.

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