Agarwala, Rina

Working Paper
Incorporating informal workers into twenty-first
century social contracts

UNRISD Working Paper, No. 2018-13

Provided in Cooperation with:

United Nations Research Institute for Social Development (UNRISD), Geneva

Suggested Citation: Agarwala, Rina (2018) : Incorporating informal workers into twenty-first
century social contracts, UNRISD Working Paper, No. 2018-13, United Nations Research
Institute for Social Development (UNRISD), Geneva

This Version is available at:

http://hdl.handle.net/10419/207010

Standard-Nutzungsbedingungen: Terms of use:

Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your
Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes.

Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle You are not to copy documents for public or commercial
Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich purposes, to exhibit the documents publicly, to make them
machen, vertreiben oder anderweitig nutzen. publicly available on the internet, or to distribute or otherwise
use the documents in public.
Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen
(insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, If the documents have been made available under an Open
gelten abweichend von diesen Nutzungsbedingungen die in der dort Content Licence (especially Creative Commons Licences), you
genannten Lizenz gewährten Nutzungsrechte. may exercise further usage rights as specified in the indicated
licence.
Working Paper 2018-13

Incorporating Informal Workers into Twenty-

First Century Social Contracts
Rina Agarwala

prepared for the UNRISD project on

New Directions in Social Policy:
Alternatives from and for the Global South

December 2018

UNRISD Working Papers are posted online

to stimulate discussion and critical comment.
The United Nations Research Institute for Social Development (UNRISD) is an autonomous
research institute within the UN system that undertakes multidisciplinary research and policy
analysis on the social dimensions of contemporary development issues. Through our work we aim
to ensure that social equity, inclusion and justice are central to development thinking, policy and
practice.

UNRISD, Palais des Nations

1211 Geneva 10, Switzerland

Tel: +41 (0)22 9173020

[email protected]
www.unrisd.org

Copyright © United Nations Research Institute for Social Development

This is not a formal UNRISD publication. The responsibility for opinions expressed in signed studies rests
solely with their author(s), and availability on the UNRISD website (www.unrisd.org) does not constitute
an endorsement by UNRISD of the opinions expressed in them. No publication or distribution of these
papers is permitted without the prior authorization of the author(s), except for personal use.
Introduction to Working Papers for
New Directions in Social Policy:
Alternatives from and for the Global South
This paper is part of a series of outputs from the research project New Directions in Social
Policy: Alternatives from and for the Global South.

The project examines the emergence, nature and effectiveness of recent developments in
social policy in emerging economies and developing countries. The purpose is to
understand whether these are fundamentally new approaches to social policy or welfare
systems which could offer alternative solutions to the critical development challenges
facing low- and middle-income countries in the twenty-first century. This research aims
to shed light on the policy options and choices of emerging/developing countries; how
economic, social, political and institutional arrangements can be designed to achieve
better social outcomes given the challenges of the contemporary development context;
how the values and norms of human rights, equity, sustainability and social justice can be
operationalized through “new” social policies; and how experiences, knowledge and
learning about innovative approaches can be shared among countries in the South. For
further information on the project visit www.unrisd.org/ndsp. This project is funded by the
Swedish International Development Cooperation Agency (Sida).

Working Papers for New Directions in Social Policy: Alternatives from

and for the Global South

Indonesian Social Policy Development in a Context of Global Social Governance

Alexandra Kaasch, Mulyadi Sumarto and Brooke Wilmsen, May 2018

Global Approaches to Social Policy: A Survey of Analytical Methods

Nicola Yeates, February 2018

Political and Institutional Drivers of Social Security Policy in South Africa

Marianne S. Ulriksen and Sophie Plagerson, December 2017

Moving towards Redistributive and Transformative Social Security?

Gendered Social and Economic Outcomes in South Africa
Sophie Plagerson, Tessa Hochfeld and Lauren Stuart, December 2017

The Controversial Brazilian Welfare Regime

Lena Lavinas, Denise Gentil and Barbara Cobo, November 2017

The Rise of Homegrown Ideas and Grassroots Voices: New Directions in Social Policy
in Rwanda
Chika Ezeanya-Esiobu, May 2017

The Development of Indonesian Social Policy in the Context of Overseas Development

Aid
Brooke Wilmsen, Alexandra Kaasch and Mulyadi Sumarto, March 2017

Universalizing Elementary Education in India: Achievements and Challenges

John Harriss, February 2017

i
Contents
Contents ............................................................................................................................ ii
Acronyms ........................................................................................................................ iii
Acknowledgements ......................................................................................................... iii
Abstract/Summary ........................................................................................................... iv
Introduction ...................................................................................................................... 1
Shifting our Gaze on Social Change................................................................................. 3
Defining “Informal Work” ............................................................................................... 5
Operationalizing the Definition ........................................................................................ 8
Informal Workers and Neoliberalism ............................................................................. 10
Informal Workers’ Organizations in India ..................................................................... 11
Informal Workers’ Organizations Globally.................................................................... 12
Informal Workers are redefining the category of "workers" ...................................... 13
Informal Workers are expanding the definition of work ............................................ 14
Informal Workers are organizing through a variety of institutions ........................... 16
Informal Workers are formulating bridges with formal labor and other social
movements .................................................................................................................. 17
Conclusion ...................................................................................................................... 18
References ...................................................................................................................... 19

ii
Acronyms

SMU Social movement unionism

NSM New social movement
SER Standard employment relationship
ICLS International Conference of Labor Statisticians
SNA System of National Accounts
SEWA the Self Employed Women's Association
CWWN the Chinese Working Women Network
KWTU the Korean Women's Trade Union
SASEWA South African Self Employed Women's Association
UFCW the United Food and Commercial Workers
ACFTU the All-China Federal Trade Union
MWDC the Migrant Worker Documentary Center
AFL-CIO the American Federation of Labor and Congress of
Industrial Organizations
EOIW Experiences in Organizing Informal Workers

Acknowledgements
I am grateful to my colleagues in the EOIW network for years of rich discussions and
debates on informal workers’ organizing efforts. I am also deeply grateful to Ilcheong Yi
for finding me, drawing me into this project, and challenging me with his constant
curiosity and excellent comments and questions.

iii
Abstract/Summary
This paper exposes and analyzes if and how informal workers serve as agents of change
for emergent social policies around the world. Informal workers (variously termed
“precarious”, “non-standard”, “irregular”, and “flexible”) have been defined as those
operating outside standard employment relationships and are thus unprotected and
unregulated by most labor laws. However, such workers continue to be regulated by other
state laws that may also affect their work, such as housing, migration, and crime. Contrary
to earlier expectations, assuming informal workers are unable to organize, recent evidence
indicates that they are organizing to defend their humanity and affect change in the global
North and South. Ironically, the political and economic ideologies and practices that have
overtly sanctioned informal work since the 1980’s have also had the unintended
consequence of opening spaces for informal workers to make demands on the state.
However, questions remain regarding the political and economic conditions under which
informal workers do/do not capitalize on this opportunity to demand new protective
policies, the varying roles they play in shaping national-level social policies, whether and
how they organize across national contexts, and the extent to which their organization
efforts succeed or fail.

To begin answering these questions, this paper draws from an ongoing cross-national
comparative project of informal workers' movements across eight countries of the global
North and South to offer an initial framework of contemporary trends in informal workers'
movements. Our findings suggest that present-day informal workers are mobilizing
populations that were often excluded from 20th century labor movements. Such
populations include workers operating within non-standard employment relationships
(such as contract-based construction workers and garment workers, as well as self-
employed domestic workers, transport workers, and trash collectors), within non-standard
workspaces (including the street, private homes, and unregistered worksheds), and
socially vulnerable groups (such as women, ethnic and racial minorities, and immigrants).
By mobilizing these groups along class and social identity lines, informal workers are
fighting to expand the definitions of “workers” and “employers” to include a larger and
more diverse range of people, relationships, and occupations.

This paper aims to analyze informal workers' as change agents; this helps acknowledge
the historically dynamic, relational nature of workers' movements across time and place,
thus re-incorporating "workers" into conversations about new social movements and new
social policies. Based on evidence from eight country cases, the author argues that
contemporary movements among informal workers must be read in relation to 20th
century workers' movements whose primary victory was to attain protected and formally
regulated work, which spurred states and employers to evade formal labor regulations
through informal employment. Today, informal workers' movements suggest efforts to
remake the working class. This finding offers a corrective to mainstream depictions of
the current landscape of labor, purporting the "end of labor politics" and the launch of
"new social movements."

Furthermore, our findings indicate that this potentially transformative mobilization stage
among informal workers is spearheaded by workers of the global South (individuals
living in the global South, as well as those who migrate to the global North). Despite their
heterogeneity, these workers share commonalities in (1) the types of work they are
engaged in and (2) the types of movements they are launching. These commonalities are
not geographically bound in the contemporary era, but are bound to a group of mobile
people. Therefore, studies on contemporary social movements must expand to include
new units of analysis that simultaneously capture the national-level socio-political
iv
contexts and transnational-level human mobility. The conceptual framework and
evidences on the re-making of the working class introduced in this paper thus offer both
continuities and alternatives to 20th century labor movements and new insights into 21st
century social contracts.

v
 Incorporating Informal Workers into Twenty-First Century Social Contracts
Rina Agarwala

Introduction

Amidst 21st century global economic crises and widespread uncertainty, new social
policies that promise to protect certain groups are emerging throughout the developing
world. This is not surprising. History has shown that in times of crisis, discontent rises.
Sociologists have portrayed that discontent can lead to regime change. To retain their
legitimacy in the face of social discontent, states often make significant policy and
regulatory changes. In some cases, discontent forces states to enact transformative policy
changes of redistribution and security for masses; otherwise, the discontent catalyzes state
repression alongside palliative efforts to attain consent from part of the population
(Arrighi 1978; Moore 1966; Riley and Desai 2007). In both cases, a new social contract
is inaugurated; welfare regimes thus emerge from conflict and collaboration between
states and their societies.

Thus, analyses of the new social policies emerging in the contemporary era demand an
examination of the state forces from above; furthermore, a thorough understanding of
social movements pushing change from below is required. Once we understand exactly
who is organizing, resisting, and attaining the state’s attention, how, and in what capacity,
only then can we truly understand the exact contours of changes taking place in the
world's welfare regimes. There is a small, yet useful, literature emerging on states’ role
in enacting welfare regimes in the global South (Srinivas 2010). In contrast, this paper
turns our analytical lens to the other side of the change relationship to expose and analyze
a group of social change agents surprisingly under-examined in contemporary research
on labor, development, and social change, i.e., informal workers.

Informal workers (variously termed "precarious", "non-standard", irregular", and

"flexible") are defined as those who operate outside standard employment relationship
and are thus unprotected and unregulated by most labor laws. They have long existed as
an essential feature of modern capitalist economies, especially in the global South. Since
the 1980s, however, states in the North and South have loosened earlier labor regulations
protecting the minority of formal workers, thereby increasing the informal workers' share
of the global workforce further. Recent scholarship on neoliberal policies eclipsing labor
protections have increased the attention to informality's role in facilitating economic
growth. However, informal workers are usually portrayed in recent literature as victims,
shorn of agency (Davis 2006; Harvey 2005). Labor movements designed to protect
workers are assumed to be dying, since the increasingly informal structures of production
are considered to prevent organization (Hyman 1992). Instead of labor movements,
scholars argue, "new social movements" are emerging around ethnic and gender identities
that fail to enact required transformative changes to ensure political and economic
redistribution (Fraser 1995; Omvedt 1993). Thus, informal workers are being written out
of the history of contemporary social change.

Recent evidence, however, indicates that informal workers in the global South and North
are organizing to defend their humanity and affect change (Agarwala 2013a; Chun 2014;
Milkman and Ott 2014). Informal workers' movements challenge the dualist assumptions
of identity movements as distinct from class movements, since informal workers organize
simultaneously along the lines of class, gender, and ethnicity/race (Agarwala 2018;
Romero 1992). Ironically, the very same political and economic ideologies and practices
that have sanctioned informal work since the 1980's have had the unintended consequence

1
UNRISD Working Paper 2018–13

of opening spaces for informal workers to make demands. For instance, capital and states
are increasingly relying on informal workers' unprotected (thus, low cost and flexible)
labor and recognizing them in policies and statistics. Moreover, identity-based
movements' struggles for recognition have increased states' attention to vulnerable
genders, races, and ethnicities—many of whom work in the informal economy. These
trends raise important questions regarding the political and economic conditions under
which informal workers do/ do not capitalize on this opportunity to demand new
protective policies, whether and how they organize across national contexts, the varying
roles they play in shaping social policies, and the extent to which they succeed or fail.

Drawing from an ongoing cross-national comparative project of informal workers'

movements across eight countries of the global North and South, this study offers an
initial framework on contemporary trends in informal workers' movements. These
movements are currently at an infant yet crucial stage; they should thus not be written off
prematurely. This is the stage Peter Waterman captured when he first conceptualized the
term "social movement unionism" (SMU), i.e., the stage of mobilizing and identifying
people under a common frame, one that precedes the attainment of legal rights, and that
was equally important to 20th century workers' movements. SMU has elicited a lively
debate on its definition and relevance (Langford and Rahman 2010). This paper focuses
on one aspect of SMU—i.e. mobilization. Specifically, our findings suggest that informal
workers today are mobilizing populations often excluded from 20th century labor
movements. These populations include workers operating within non-standard
employment relationships (such as contract-based construction workers and self-
employed domestic workers), within non-standard workspaces (including the street,
private homes, and unregistered worksheds), and socially vulnerable groups (such as
women, ethnic and racial minorities, and immigrants). By mobilizing these groups along
class and social identity lines, informal workers are fighting to expand current definitions
of "workers" and "employers" to include a larger and more diverse range of people,
relationships, and occupations.

The framework offered analyzes informal workers as change agents and helps to
acknowledge the dynamic, relational nature of workers' movements across time and
place, enabling the re-incorporation of "workers" in conversations regarding new social
movements and social policies. 20th century workers' movements also began with a
version of SMU. However, their primary victory (i.e. protected and regulated work)
invoked a response from employers (i.e. employing unprotected, informal workers
instead) that led to a rebirth of alternative workers' movements and a consequent return
to SMU. Today, the most fervent alternative worker's struggles in the contemporary era
are expanding among the most degraded group of unprotected workers. We are not,
therefore, witnessing an era of the "end of labor politics" or the beginning of "new social
movements. Rather, this is an era of a remaking of the working class. This re-made
working class offers both continuities and alternatives to 20th century labor movements
and new insights into 21st century social contracts.

Finally, my findings indicate that this potentially transformative mobilization stage

among informal workers is spearheaded by workers of the global South (including those
living in the South and those who have migrated to the North). Despite their
heterogeneity, these workers share remarkable commonalities in (1) the types of work
they are engaged in and (2) the types of struggles they are launching. It is thus argued that
these commonalities are not geographically bound in the contemporary era, but are bound
to a group of people that is mobile. Studies on contemporary social movements thus must
expand to include new units of analysis that simultaneously capture national-level socio-

2
 Incorporating Informal Workers into Twenty-First Century Social Contracts
Rina Agarwala

political contexts and transnational human mobility. Only then can we understand
varieties and continuities in 21st century social contracts across national contexts.

The paper is further organized as follows: Section 1 examines why informal workers have
been so absent in literature regarding social change and the consequences of this
omission. Section 2 offers a definition of "informal workers." Section 3 analyzes the
impact of recent neoliberal policies on informal workers. Section 4 examines key actors
and institutions and the primary strategies and demands underlying contemporary
informal workers' movements across eight countries. This section showcases the resulting
laws, regulations, and programs affecting the political, economic, and social conditions
of informal workers. Key characteristics of informal workers' movements identified in
the movements across these eight countries can potentially shape a new social contract
involving informal workers. Thus, a framework of questions is presented to help
incorporate informal workers into analyses of contemporary welfare reforms and regimes.

Shifting our Gaze on Social Change

Sociologists have long argued that social movements affect political change (Moore
1966). Perhaps the most studied social movement of our time has been the industrial labor
movement and its effects on modern welfare regimes (Rueschemeyer, Stephens, and
Stephens 1992). Before the spread of 20th century regulations formalizing labor rights,
all labor was "informal" or unprotected and unregulated. This informal labor demanded,
formulated, and, in some cases, governed early-to-mid-20th century welfare policies
designed to recognize workers, regulate working conditions, mitigate exploitation, and
protect workers' dignity and human rights (Thompson 1966). While countries varied in
their levels of implementation of labor regulations during this period, they shared an
"expressed" commitment to formally recognize labor under law, hold states responsible
for the enforcement of labor protection, and ensure that capital de-commodified workers'
productive and reproductive labor through minimum wages, job security, work contracts,
health care, and old-age benefits (Esping-Anderson 1990). This commitment was more
than just a rhetorical fluff. It gave labor the seed of power, the confidence, and the "legal
right" to make welfare demands vis a vis the state, employers, and larger public.

However, it was within the wake of these “victories” for labor rights that scholars and
activists examining social change and development have shifted their focus to a particular
segment of the working class—formal workers now legally entitled to the protections and
regulations that all labor fought hard to attain. Those who remained informal and
unregulated were no longer highlighted as "agents" of social and political change. Instead,
they were (and often still are) assumed to be unable to organize, since informal
employment disperses the site of production through home-based work, complicates
employer-employee relationships through multiple sub-contracting arrangements, and
atomizes labor relationships by eliminating the daily shop floor gathering of workers
(Berger and Piore 1989; Gugler 1991; Hyman 1992).

This omission of informal workers in analyses of social change is problematic for several
reasons. First, assumptions that informal workers are structurally unable to organize fly
against the empirical truth of history; as noted above, it was these workers who
established the concept of "formal workers" by fighting for 20th century labor regulations
(Thompson 1966). Second, the theoretical basis for these assumptions are weak, since
class politics must be examined as a dynamic social relationship (Agarwala 2006). In a
system where capital and labor are bound to each other in a simultaneously co-dependent

3
UNRISD Working Paper 2018–13

and competing relationship, both groups will constantly innovate to protect their interests.
Capital will find new ways to exclude or exploit labor to expand profits, while labor will
fight de-regulation and commodification to protect their rights (Marx 1976; Polanyi
2001). Given that informal labor is involved in capitalist production, there exists no
theoretical basis for assuming that informal labor will not seek innovative sources of
power to protect their humanity.

Third, by omitting informal labor from analyses of social change, the understanding of
the forces of labor in capitalist economies—including informal labor, formal labor, and
the relationship between the two—stands weakened. Despite the labor movement's
impressive strides in attaining labor regulations worldwide, the vast majority of the
world's workers remained informal or excluded from these regulations, throughout the
20th century. This exclusion was no accident. Capital has long used flexible, low-cost
informal labor to subsidize its minority of protected workers (Lenin 1939; Luxemburg
1951). Furthermore, formal workers' movements have benefitted from the exclusion of
informal workers. Formal labor, informal labor, and capital are thus embedded in a
complex social relationship of interdependence within capitalist production; a complete
analysis of labor and capitalist production must include all actors.

Finally, seeing formal workers as the only potential change agents (among workers) has
forced a misreading of contemporary capitalism as devoid of class politics since the
1980's. Despite early development theories predicting an eventual fall in the share of
informal workers and a concurrent rise in the share of formal workers (Lewis 1954), the
share of informal, unprotected workers in rich and poor countries has risen since the
1980's (ILO-WIEGO 2013). Since informal workers are assumed unable to organize, their
rising share has been equated to the demise of workers' movements. Many have mourned
the loss of dignity among the world's workers (Davis 2006), highlighting the role that
contemporary neoliberalism plays in exacerbating workers' poverty (Harvey 2005) and
warning against potential dangers of a swelling, disorganized precariat (Standing 2011).
Failure to examine informal workers as potential change agents has thus led to an
incomplete analysis of processes through which new welfare regimes are forming to
affect workers worldwide.

Instead of class, scholars since the 1980's have highlighted the rise of "new social
movements" (NSM), featuring interest-based movements on (among others) environment
and poverty and identity-based movements organized by gender, caste, religion, or
ethnicity (Touraine et al. 1983). In recent years, scholars have depicted these movements
in the global South as budding "counter movements" of resistance to Neoliberalism.
Resurrecting a version of Karl Polanyi’s (2001) predictions that market fundamentalism
will catalyze people to protect themselves against commodification, scholars have
showcased the rise of migrant protests for access to social rights in China (Friedman
2014), community protests for service delivery in South Africa (Hart 2002), caste-based
movements for equality in India (Omvedt 1993), immigrant movements for new
definitions of citizenship in the US (Fine and Meyer 2013), and gender movements for
democracy in Tunisia (Charrad 2001).1

While this recent literature has been instrumental in illustrating the discontent expressed
even in the face of rising poverty under neoliberal, globalized production structures, it
has been less helpful in providing a dynamic framework on class or illuminating the
understanding of informal workers as change agents. Oftentimes, these NSMs are
analyzed relative to formal workers' movements. Some celebrate that the NSMs’ ability
1
Few have examined Polanyi’s prediction that counter-movements also include fascist movements.

4
 Incorporating Informal Workers into Twenty-First Century Social Contracts
Rina Agarwala

to offer women and ethnic minorities a promising alternative to the workers' movements
that grew in the first half of the 20th century that often excluded minority genders and
races (Charrad 2001). Others critique NSMs for being "alienated," "cellular," and
"fragmented" (Chatterjee 1993; Chatterjee 2006; Friedman 2014). Even the media
repeatedly notes the "limited" impact recent NSMs have had on policy (Economist 2015).
These critiques are sometimes posed in contrast to the more structural impacts of 20th
century workers' movements; otherwise, they are posed as consistent with problems faced
by 20th century formal workers' movements.

In both cases, these analyses frame NSMs that resist deleterious forces of neoliberalism
as distinct from class-based movements, despite the fact that NSMs are often spearheaded
by poor (informally employed) workers. Focusing exclusively on the non-class identities
used to organize NSMs, the current literature ignores the central relationship of labor
exploitation in modern neoliberal economies and omits an important segment of workers
as potential contributors to transforming the contemporary social contract. Thus, we know
surprisingly little about how poor workers are affecting change today. Additionally,
assessments of NSMs successes and failures are often made relative to formal workers'
20th century movements, which have had the advantage of over a century of experience.
NSMs are thus often written off prematurely, and contemporary social contracts are
misread as merely a product "from above."

To escape these traps in the current literature on social change, we must revisit the
analytical boundaries around present definitions of class, identity, and social movements.
Only then, can we "see," let alone analyze, informal workers' movements from below and
their impact on social policies from above.

Defining “Informal Work”

Scholars have long debated the meaning of informal work and the reasons for its existence
(Bromley and Gerry 1979; Rakowski 1994). An attempt to distinguish the informal
economy from the formal economy underlies such debates, which has come to typify
advanced, industrial modernity (Agarwala 2009). It is thus unsurprising that definitional
debates on informality are more advanced in the global South, where scholars, labor
activists, and policy makers have been grappling with the simultaneous presence of
informal and formal labor as a central feature of their modern economies for decades.

In the global North, recent scholars and activists have popularized the term "precarious
work." Some define "precarity" as a "continuum" comprised of four criteria: the degree
of certainty of continuing employment, control over the labor process, degree of
regulatory protection (though unions or laws), and income level (Cranford, Vosko and
Zukewich 2003; Rodgers 1989). Guy Standing (2011) famously defined "the precariat"
as a social category comprising of people lacking seven forms of labor security: labor
market security, employment security against arbitrary dismissal, job security and access
to upward mobility, work security or protection against accidents, illnesses, and arduous
working conditions, skill reproduction security, income security, and representation
security. While these definitions are useful in illustrating specific features of precarious
work, they are too disparate to operationalize. More importantly, since they do not embed
the concept of precarity within larger socio-economic structures, they lend fewer insights
into why precarity exists in the first place.

5
UNRISD Working Paper 2018–13

In contrast, scholars drawing from the global South offer definitions that are more simple,
operational, and analytically rigorous. This scholarship has favored the term "informal
work."2 Since the 1980's, these scholars have highlighted the "social relationship"
between labor, capital, and the state, emphasizing the role of regulation. Portes, Castells,
and Benton (1989), for example, drew on Latin America to define informal workers as
those engaged in producing and providing legal goods and services, but who nevertheless
operate outside labor, health, and financial regulation. Similarly, Jan Breman recently
reiterated his earlier work on South Asia to define informal work as "a type of waged
employment thoroughly flexibilized and unregulated by public intervention" (Breman
and van Linden 2014, 926). Underlying Breman and van Linden's informality is a short
list of features including part-time, flexible jobs; low wages and decreased secondary
benefits; an increase in outsourcing and self-employment; irregular work days
(lengthened and shortened); and relaxed controls on work conditions.

These definitions, focusing on workers' relationships to regulation, enable us to analyze

informal workers' relationships to other economic actors, such as the state, formal
workers, and employers. As Vladimir Lenin (1939) and Rosa Luxemburg (1951)
famously illustrated, informal workers are not a remnant of a feudal past or a temporary
step in the transition to a capitalist future. Instead, the informal economy is a necessary
subsidy to the growth of modern, formal capitalist economies. Under imperialism, Europe
drew on alternative modes of production (such as pre-capitalist, artisan, feudal, and petty-
bourgeois) in colonies to secure raw materials for growing manufacturing structures. In
addition, class struggles that increased European wages forced European capitalists and
formally protected workers to rely on the colonies' cheap, flexible, informal workforce
for low-end manufactured goods and services. Following independence, the political and
social institutions enshrined throughout much of the developing world continued to
ensure that informal workers absorbed the formal economy's cost of low-end production
and labor reproduction by forsaking benefits or minimum wages. For instance, informal
workers in Bogotá's shoe-making industry worked as subcontractors for formally
regulated firms in Colombia (Peattie 1987). Working in the privacy of their homes or
unregistered worksheds, they mitigated employers' overhead costs (Moser 1978) and
helped them and states to constrain the expansion of a costly, protected formal working
class (Portes and Walton 1981). Like formal labor, informal labor thus performs a crucial
function in capitalist growth; however, unlike formal labor, informal labor is not
regulated.

Highlighting the delineation between the regulated and unregulated and exposing
interdependencies between informal and formal workers, the state, and employers, this
paper uncovers the structural reasons for the continued growth of the informal economy
under modern capitalism. Informal work "fosters" growth. Furthermore, an important
advantage to the regulation-based definition, informal work enables the inclusion of
informal workers in rural and urban sectors, operating within pre-capitalist and capitalist
systems. Again, they are often interdependent. Finally, this definition avoids making
subjective claims on the informal economy's "traditionalism" (Portes and Haller 2005).
This is an important corrective to 1970s' modernization literature, when scholars first
highlighted informal work, but viewed it as a temporary, pre-capitalist waiting room
(comprising mainly of self-employed entrepreneurs) that would be eliminated as workers
were absorbed into the modern, urban, formal economy (Harris and Todaro 1970; Hart
1973). Moreover, the regulation-based definition makes no subjective claims on the
informal economy's "creativity." which is an important corrective to the recent neoliberal

2
There is no consensus on the distinctions between "precarious" and "informal." This paper has used the terms interchangeably here.

6
 Incorporating Informal Workers into Twenty-First Century Social Contracts
Rina Agarwala

development literature that has celebrated informal work as a solution to overly regulated,
neutered markets (De Soto 1989).

An important drawback to the regulation-based definition, however, is that it does not

accommodate contemporary informal workers' efforts to establish "new" regulations of
protection. As is detailed below, informal workers worldwide are launching alternative
labor movements to demand protections within their informal work status. Thus, although
they are attaining some protective regulations, they are still identifying as "informal."
This paper thus qualifies the regulation-based definition to specify that informal workers
are those not regulated or protected by the "standard employment relationship" (SER)
defining formal workers (Agarwala 2013a).

Existing labor laws generally aim to fight labor appropriation, or the relationship of
exploitation, within the narrow confines of a legally recognized employer-employee
relationship or SER (Wright 2002). However, it is the "non-standard" employment
relationship that makes informal workers appealing to capital, distinguishing them from
formal workers. To avoid labor regulations against exploitation, capital merely
complicated, and thus hid, the employer-employee relationship in two ways. First, capital
hired "contract" or "casual" workers, directly involved in capitalist production, but hired
through sub-contractors to avoid visibility, regulation, and protection. Contract workers'
principal employers can be small, unregulated enterprises or formally registered
companies, such as Honda or Levis. These workers work in their homes, unregulated
work sheds, or on the factory floor next to formal workers.

Second, capital relied on "self-employed" workers. Such workers are owners of small,
unregulated businesses that provide cheap inputs for capital production (such as auto-
parts, transport, or products manufactured on order) and goods and services to middle and
upper class capital owners (such as cleaning, elderly care, gardening, and waste
collection) and to low-wage workers (such as food, clothing, and haircuts). Many
countries define "formal" employment by enterprise size, thereby excluding from labor
protection self-employed workers (who own small enterprises) and workers in small
enterprises. In contexts where contract workers are protected under law, employers avoid
regulation by claiming they "buy" their finished products from a self-employed worker,
rather than a hired contract worker, though the product is ordered and designed by the
employer. In these cases, self-employed workers resemble mislabeled contract workers.
They work in their own homes, employers' homes, or in public spaces, like the street.

Together, contract and self-employed workers are referred to as "informal" or

"precarious" workers. Both groups make legal goods and services. Yet neither have a
legal labor contract. Therefore, informality features non-standard employment
relationships, which, by definition under most existing labor laws for those in standard
employment relationship, are unregulated. Most informal workers operate in vulnerable
working conditions with low incomes. Today, they can be found in all sectors of the
economy, including agriculture, manufacturing, construction, and services.

Since several workers simultaneously operate as formal workers and moonlight as

informal workers, some might question the usefulness of the distinction. Why not simply
speak of informal vs. formal "work" or "sectors," rather than "workers?" Indeed, as is
shown in the following section, early discussions did focus on the "work," rather than on
"workers." However, the distinctions between informal and formal work were found to
be as blurry as with workers, since so much informal work takes place alongside formal
work, by the same employer, sometimes on the same shop floor. Moreover, informal

7
UNRISD Working Paper 2018–13

workers are purposefully articulating their identity in contrast to formal workers. But by
defining themselves as workers with diverse employment relationships, they are
ultimately re-defining the concept of "all workers" and may eventually erase the need for
formal/informal worker distinction.

Operationalizing the Definition

In 1993, participants of the 15th International Conference of Labor Statisticians (ICLS)
marked a historic turning point by finally agreeing that informal workers must be counted
in labor force surveys to improve analyses on the modern global economy. An
internationally consistent, operational definition of the informal economy was viewed as
a first step toward collecting and analyzing data on the subject. The absence of such a
definition until then had yielded case studies offering vastly different, sometimes
conflicting, conclusions about causes and effects of informal work (Rakowski 1994). To
address this issue, ICLS participants drafted a definition that was subsequently
incorporated into the 1993 System of National Accounts (SNA).3

The 1993 ICLS definition, however, was limited by its underlying economic
theorization of the informal economy that ignored its social and political relations with
the formal economy. The ICLS defined informal economy as "enterprises" that have a
low level of organization, little or no division between capital and labor as factors of
production, and where labor relations consist of social relationships, not formal contracts.
Under this definition, the informal economy comprised only of unregistered or
unincorporated enterprises owned by households producing goods and services to
generate employment (ILO 1993).4 This definition omitted, and thus undermined the
ability to empirically examine, other growing subsets of informal workers that are crucial
to the neoliberal agenda. These include unregulated contractors working for formal
companies; workers who move back and forth between, or work simultaneously in,
informal and formal employment; and self-employed workers who work alone at home
or in multiple locations on the street, whose workplaces are not counted as "enterprises"
(Satpathy 2004).

Criticisms against the 1993 ICLS definition spawned a new operational definition
of "all" informal workers in terms of their employment status (i.e. casual, self-employed,
or regular worker) and the characteristics of their enterprises (i.e. legal status and/or size
of the enterprise). Ralph Hussmanns (2002) of the ILO presented the matrix reproduced
in Table 1 to outline this broader definition that ensures the inclusion of informal workers
in informal and formal enterprises and of regular workers in informal enterprises. This
definition thus incorporates economic sociologists' relational definition of the informal
economy. Although this newer definition has not yet been incorporated into the SNA, in
2003, the 17th ICLS began using the term "informal economy," instead of "informal
sector," to capture informal workers in both informal and formal enterprises.

Drawing on this definition of informal workers—i.e. all those that are unregulated
by laws based on the SER—this paper will now examine the rise of informal work in the
contemporary era of neoliberalism and globalization.

3
SNA sets the international statistical standard for measuring the market economy to ensure international comparability. It is
published by the United Nations, the Commission of the European Communities, the International Monetary Fund, the Organisation
for Economic Co-operation and Development, and the World Bank. The first SNA was established in 1953 .
4
Production and household expenditures in these enterprises are usually combined and financial accounts are rarely maintained.

8
 Incorporating Informal Workers into Twenty-First Century Social Contracts
Rina Agarwala

Table 1: Hussmanns Matrix on Informal vs. Formal Workers

Production Jobs by status in employment

units by type
Own-account Employers Contributing Employees Members of
workers(c) family producers’
workers cooperatives
Informal Formal Informal(d) Formal Informal Informal Formal Informal Formal
Formal
economy 1 2
enterprises

Informal
economy 3 4 5 6 7 8
enterprises(a)

Households(b) 9 10

Note: Table reproduced from Hussmanns (2002).

(a)
Informal enterprises are distinguished from formal enterprises based on (1) the size of
employment and/or (2) the registration status of the enterprise and employees. Limits
are defined on a national basis. Informal enterprises exclude households employing paid
domestic workers.
(b)
Households produce goods for their own final use and employ paid domestic workers.
(c)
Own-account workers own and operate an enterprise alone or with members of the
same or an additional household. They may employ family members and employees on
an occasional basis.
(d)
Informal employers may employ one or more employees on a continuous basis.

 Dark grey: Jobs that do not exist

 Light grey: Jobs that exist, but are not informal
 Cells 3-8: Employment in the informal economy
 Cells 1-6, 8-10: Informal employment
 Cells 1, 2, 9, 10: Informal employment outside the informal economy

9
UNRISD Working Paper 2018–13

Informal Workers and Neoliberalism

When examining informal workers' movements globally, it is important to recognize that
informal labor is not a product of neoliberalism. Capitalist employers have avoided labor
regulations against exploitation by simply hiring workers through unregulated sub-
contracting arrangements since the early 1900's. Although the struggles and social
contracts of the 20th century did much to improve the lives of millions of workers, they
failed to include most of the workforce that capital employed outside the purview and
protection of legal regulations. By hiding the employment relationship to avoid
regulation, capital could exploit a mass, cheap, and flexible informal labor force, which
in turn could subsidize the minority of protected formal workers. Informal workers are
thus a significant and structural feature of capitalist accumulation and have always
existed, especially in the global South (Agarwala 2013a).

What is new under neoliberalism, however, is the increased growth of the relative share
of informal workers. Particularly striking has been its growth in the global North (as well
as the South). In South Asia, Southeast Asia, and Africa (excluding South Africa), the
informal workforce represents 60–80% of the non-agricultural workforce; in Latin
America, it represents 40–60% (ILO-WIEGO 2013). Case studies from Japan, the United
States, Canada, and Europe illustrate similar trends of a swelling informal workforce,
coupled with a shrinking formal workforce (Bakan and Stasiulis 1997; Boris and Klein
2012; Gottfried 2015; Hatton 2014; Wills 2009).

How can we explain this unpredicted global rise in informal work? Much has been written
about the ideological forces of "neoliberalism" and "globalization" urging states
worldwide to deregulate markets and absolve capital of any responsibility for labor's
welfare (Harvey 2005). Firms claim that to remain competitive in an increasingly global
market, they must hire additional informal workers not bound by legal recognition, costly
labor benefits, and constraints of job security. In response to these claims, governments
(to varying degrees) have pulled away from their responsibility to enforce labor
regulations and enfold all workers into the protected, regulated sphere. More so than
before, the public, capital, and states are sanctioning informal labor, despite its operations
outside state laws.

Within this framework of decreased restrictions on employers, employment has grown in

the global South over the past two decades (alongside increased dispossession). East Asia
and South Asia have lower unemployment levels (at 3–4%) than the global average of 5–
6%.5 Despite a slight increase after the 2008 crisis, unemployment levels are lower than
in 1991. In Latin America and Sub-Saharan Africa, unemployment levels are higher than
the global average—which is being pushed down by Asia—at 6–9%; however, there has
been a steady decline since 2000 in Sub-Saharan Africa and since 2003 in Latin America.6
Additionally, labor productivity throughout the global South has increased in the last two
decades, especially in services (ILO 2013).

However, the picture is not all rosy. Poverty figures suggest that expansion in work and
improvements in labor productivity in the global South can be attributed to decreased real
wages and worsened work conditions. Although the number of people living in extreme
poverty (less than US$1.25/per day) has dropped in recent decades—which is consistent
with expanding employment—the number of people living in "near poverty" (between $2

5
Youth unemployment in these regions remains high.
6
Although there was a brief increase in 2008, Latin America had a quick recovery.

10
 Incorporating Informal Workers into Twenty-First Century Social Contracts
Rina Agarwala

and $4 per day) has increased by 142 million in the past decade, raising the total to 661
million people (ILO 2013). In other words, although employment is expanding, more of
the world's workers are operating in degraded conditions, under a cloak of increased
invisibility, with little pay and intense working days. Enabling this trend is a fading
respect for the 20th century social contract, where even the expressed commitment to
mitigate labor exploitation is waning. Herein lies the second failure in 20th century social
contracts—they have proven to be unsustainable.

Therefore, even more important than the growth in relative "size" of the world's informal
workforce in recent decades has been the decline in the relative "power" of the world's
workers to protect themselves against labor appropriation. Neoliberalism has altered the
"politics" around informal work. The challenges facing labor today do not necessarily
mean that labor politics is dead. Rather, it means that worker organizations' terms,
strategies, and members have changed.

In the following sections, I illustrate informal workers' organizing efforts today, drawing
on my own research in India and the initial findings of a comparative study conducted by
a new global network of labor scholars and grassroots organizations studying informal
and precarious worker organizing across Brazil, Canada, China, India, Mexico, South
Africa, South Korea, and the US.7 Indian informal workers have been organizing since
the 1970's and thus provide an important lens into one set of fairly developed movements.
However, we know that social movements are context specific; indeed, India's colonial
history bred a powerful, anti-colonial movement among workers and its post-colonial
commitment to democracy bred active civic engagement. The cross-country examination
thus provides clues to the similarities and differences in informal workers' movements
across country specifics.

Informal Workers’ Organizations in India

Recent evidence has shown that informal workers are indeed organizing to defend their
humanity despite vulnerabilities, contrary to popular belief that informal structures of
production prevent organization.

I have analyzed elsewhere how informal workers in India are advancing their rights
through alternative workers' struggles (Agarwala 2013a). Rather than fighting
unregulated, flexible production structures and demanding traditional work benefits, such
as minimum wages and job security, from employers, Indian informal workers are using
their power as voters to demand state responsibility for social consumption or
reproductive needs, such as education, housing, and healthcare.

To institutionalize this strategy, Indian informal workers are fighting to enact and
implement an innovative institution called "Welfare Boards." These are tripartite
institutions implemented by the state or central government and are funded by
governments, taxes on employers, and membership fees from workers. In return for being
a member of a Board, workers are entitled to a variety of welfare benefits. Currently,
welfare boards in India are occupationally based; benefits differ according to trade.
Welfare boards have become an increasingly popular protection mechanism among

7
The Experiences Organizing Informal Workers (EOIW) is a global network of labour scholars and labour organizations
that seek to expand knowledge of new organizing efforts taking place among informal and precarious workers around
the world. The author is a founding member of EOIW.

11
UNRISD Working Paper 2018–13

informal workers' organizations in India. Their success (which has been mixed) depends
on the political and economic context in which they are implemented. Those operating
under competitive populist parties aiming to implement neoliberalism have ironically
been more successful than those operating under a single, hegemonic party rule, even
when that party is left wing (Agarwala 2013a).

As a result of this strategy, Indian informal workers are pulling the state into playing an
even more central role than it did in formal workers' movements. Interestingly, doing so
has not precluded Indian informal workers from leading movement efforts at the
transnational level. For instance, it was a leading informal workers' union in India, the
Self Employed Women's Association (SEWA), that joined forces with a multi-lateral
organization, the ILO, and the most legitimate producers of knowledge in the North,
Harvard University, to define and operationalize the concept of informal work and revise
national-level labor force surveys to better capture informal workers (Agarwala 2012).

Moreover, informal workers are forging a new class identity that connects them to the
state through social consumption needs and that attains state recognition for their work,
even in the absence of employer recognition. This strategy has enabled these workers to
address their gender identities by recognizing their productive and reproductive needs
(Agarwala 2013c). This recognition comes in the form of a "worker identity card" that
provides official state recognition for their work, even in the absence of employer
recognition.

It should be noted that although getting welfare boards in place are central to many Indian
informal workers' movements, efforts to reform wage rules are also ongoing. In several
cases, informal workers are fighting the state to alter minimum wages from time-based to
piece-rate, to better reflect contemporary production structures. Moreover, informal
workers' movements among self-employed workers are forming their own cooperatives
and companies to ensure the security of their livelihood (Agarwala 2015).

To attract the attention of elected state politicians to enact the welfare boards, identity
cards, and redefined minimum wages, informal workers utilize a rhetoric of "citizenship"
rather than labor rights. These workers are organizing at the neighborhood level, rather
than on the shop floor, to mobilize the dispersed, unprotected workforce without
disrupting production. Given the unregulated nature of their work, it may seem ironic that
these workers are trying to strengthen their relations with the state. Yet, this movement is
developing across states and industries in India—thereby reflecting the state's interest in
informal work. Furthermore, these movements reiterate that the definition of informal
workers applies to the circumstances of their work, and not to their politics, which may
indeed be "formal" or officially registered.

Informal Workers’ Organizations Globally8

Recent scholarly evidence has shown that Indian informal workers are not unique in
organizing. Retail store workers in South Korea, street vendors in Mexico, and restaurant
workers in the United States are launching alternative movements to challenge neoliberal
policies (Chun 2009; Cross 1998; Fine 2006; Milkman and Ott 2014). These seemingly
disparate case studies call on us to examine the themes and relationships that may be

8
The findings in this section draw from the following: (Mosoetsa 2012, Ngai og Xin 2012, Agarwala 2013, Fine og Milkman 2013,
Garza 2013, Salas og Kerr 2013, Chun 2014, Vosko et al. 2014)

12
 Incorporating Informal Workers into Twenty-First Century Social Contracts
Rina Agarwala

emerging among informal workers' movements across national contexts, to better

examine how 21st century social contracts will be shaped "from below."

The following section depicts notable trends found among informal workers' movements
across country contexts.

Informal Workers are redefining the category of "workers"

Perhaps the most striking feature of current informal workers' struggles is that across
countries, these workers are mobilizing and organizing demographic and ascriptive
groups previously excluded from formal workers' movements. Particularly, informal
workers are organizing women and migrant workers—both of whom have long been
deemed the most vulnerable and "unorganizable" workers. They are not being organized
at the exclusion of men and/or native workers; indeed, men and native workers are
growing in the informal sector. However, the fact that women and migrant workers are
being included at all in informal workers' struggles implies that informal workers are
redefining and expanding the categories of "work" and "workers," which has important
implications on the nature and focus of their demands and strategies and on future social
policies.

Informal work has long been known to employ a disproportionate share of female
workers. Therefore, by recruiting female members and leaders, informal workers'
movements are directly challenging the use of gendered stereotypes to guarantee a
"docile" workforce that is considered to not need or demand job security or high wages.
As a result of their focus on women workers' rights and their disproportionate share of
women leaders, informal workers' struggles have organized workers in traditionally
"feminized" occupations long unorganized. These include domestic work (in the United
States, South Africa, China, Mexico, South Korea, and India), street vending (in South
Africa and Mexico), homecare work (Canada and South Korea), and manufacturing in
apparel and tobacco (Brazil and India). In some countries (notably China, South Korea,
India, and South Africa), women workers have developed networks and organizations
designed exclusively to address women's issues; these include the Chinese Working
Women Network (CWWN), the Korean Women's Trade Union (KWTU), the Self-
Employed Women's Association (SEWA) in India, and South African Self Employed
Women's Association (SASEWA). CWWN and KWTU provide legal counseling
services. CWWN, SEWA, and SASEWA provide health services, training on
occupational health, and a women workers' cooperative. Moreover, SEWA provides
micro-banking facilities, child-care services, and a union for women workers in the
informal economy. All four groups have emerged due to male domination found in
traditional unions.

Additionally, apart from mobilizing previously excluded occupations, informal workers'

focus on women workers and female leadership has altered demands from those of the
20th century formal workers. Specifically, informal workers' struggles (across national
and industry contexts) place a larger focus on reproductive rights. For instance, in India,
South Korea and the US, informal workers' have fought to de-commodify not only the
productive costs of labor, but the reproductive labor costs that women workers have
disproportionately borne without compensation (Agarwala 2013c; Milkman and
Terriquez 2012 ). Such efforts have resulted in welfare benefits, such as health and
education benefits, housing, and child care, and assets directly in women's hands. Thus,
informal workers are highlighting intersections of class and gender through means that
formal workers' movements or feminist movements have not used previously.
13
UNRISD Working Paper 2018–13

Furthermore, informal workers have mobilized migrant workers. Increasingly, employers

have turned to international and domestic migrants to staff informal jobs. As with women,
migrant workers have long been considered vulnerable and "unorganizable" by labor
activists and thus easily exploitable by employers. Informal workers, however, are
challenging these notions by revising the meaning of "citizenship rights" to extend the
past narrow definitions tied to passports. In the US, Canada, and South Africa, informal
workers have actively fought for improved rights for immigrant workers from abroad;
here, vulnerability is seen tied to a worker's legal citizenship status. Thus, efforts to
protect workers advocate for public policy changes to legalize undocumented workers,
publicize all labor abuses, and provide direct support services to immigrant workers,
including legal aid, leadership training, and popular education. In the US and Canada,
these organizations usually operate under the Worker Center model. Notably, in Canada,
the United Food and Commercial Workers (UFCW) and the Agricultural Workers
Alliance have created ten centers for migrant farmworkers, one of which has provided a
path to permanent residency for temporary foreign workers in their collective agreement.
In South Africa, these organizations are informal and unregistered, although they are
often official members of international networks such as StreetNet.

In China, informal workers have actively fought for improved rights and recognition for
rural-urban migrants from within China. Until 2003, these workers were excluded from
China's only legal union, the All-China Federal Trade Union (ACFTU). By 2007, four
years after the ACFTU opened its doors to migrants, 70 million migrant workers
registered as union members. Additionally, migrant workers developed alternative
organizations, such as the Migrant Worker Documentary Center (MWDC), which
provides legal aid and counsel for labor disputes and overdue compensation, offers a
cultural development center, manages an occupational safety network, monitors codes of
conduct, collects data on labor conditions, and conducts workshops on local and
international labor laws.

Informal Workers are expanding the definition of work

Informal workers across country contexts are organizing occupational categories that
have long been excluded from traditional workers' movements. Part of their success can
be attributed to their ability to organize the types of workers that staff these occupational
categories (i.e. women and migrants). Additionally, informal workers are reorganizing
occupational categories whose changing structures of production are demanding new
forms of organization. At the comparative level, it is striking to note similarities in
occupational sectors that are organizing across countries, despite deep variation in
country contexts. Specifically, we find that organization occurs in domestic work,
construction, manufacturing, street vending, transport, and waste picking. Findings show
that most informal workers' struggles are taking place in urban (or semi-urban), non-
agricultural work.

This similarity across sectors in several countries suggests that structures of occupations,
regardless of the country context, may play an important role in determining the forms,
strategies, and potential for informal workers' organizations. Moreover, it seems likely,
that parallel organization of particular occupations is promoted by regional and global
occupation-specific networks, such as the International Domestic Workers Federation,
HomeNet, and StreetNet, along with some global unions, such as the Building and Wood
Workers International, which work with construction workers worldwide.

14
 Incorporating Informal Workers into Twenty-First Century Social Contracts
Rina Agarwala

Another notable trend across occupational categories is that informal workers' demands
appear to be correlated with the geography of their workplace. Workers who operate in
public spaces—street vendors, transport workers, and waste-pickers—are primarily
constrained by antagonistic relations with local enforcement authorities, rather than
traditional employers. Their efforts in these occupations thus focus on attaining state
recognition for their work through identity cards, securing a right to work by attaining
access to public space, and regulating the industry through licenses and taxes to avoid
police harassment. In doing so, informal workers are expanding the narrow definition of
"exploitation," from employer to employee, ingrained in 20th century social contracts, to
include additional axes of exploitation, such as from state to worker. For instance, in the
case of waste-picking, municipal governments profit off the underpaid work of informal
trash collectors, while the police simultaneously profit from bribes collected from the
very same informal trash collectors (Agarwala 2016).

In some contrast, workers operating in private spaces, such as homes, contractor's

worksheds, or employers' premises are constrained by the antagonistic relations with
employers and are thus demanding economic and social benefits to improve their standard
of living. These occupations include domestic workers, construction workers, and
manufacturing workers. In some cases, these informal workers call for improved wages
and working conditions; in others, they call for welfare benefits. Across all occupational
categories, informal workers' organizations supplement collective action strategies
against the state and employers with direct services to members.

Furthermore, initial findings suggest that informal workers' organizing strategies may
depend on where they sit on the spectrum of informal work—with contract work on one
end and self-employed work on the other. Although both groups share several work
characteristics, namely that they are not protected or regulated by existing labor laws and
live in daily precarity, the structures of their work and their employment relationships
differ in ways significant for organizing (see Figure 1). This paper suggests that contract
workers on one end of the spectrum of informal work fight for economic and social
benefits, such as welfare boards, social security, and increased wages to improve their
living standards. At the other end, self-employed workers fight for measures that ensure
their right to work without harassment from local authorities through licenses and taxes
and access to work space. Moreover, some self-employed workers are fighting to redefine
their buyers to whom they sell finished projects "on order," as "employers," despite not
having an employment contract. Industries that fall in the middle of the spectrum appear
to make both sets of demands. Across the spectrum, informal workers target their
demands to the state, employers, and, in some cases (such as transport workers),
consumers.

15
UNRISD Working Paper 2018–13

Figure 1: Continuum of Informal Workers' Movements

Contract Workers Self-employed

Workers

Bidi (hand-rolled Domestic work Street vending

cigarette) Recycling Transport (taxi,
Construction auto/cycle
Textile/apparel rickshaw)

Demand: De-commodification Demand: Right to Work

 Welfare board  Regulation (license, tax)
 Social security  Work space
 Increased wages

Perhaps most significant, all organized informal workers across occupational categories
and employment relations share a "struggle for recognition" of themselves as workers and
their occupations as legitimate categories of work. To attain such recognition, informal
workers' organizations have educated workers to own and express their own identities as
workers and advocated governments to alter their labor force surveys to better capture
home-based and other informal work, to include more occupations within the jurisdiction
of local labor laws, and to issue worker identity cards to informal workers.

Informal Workers are organizing through a variety of

institutions

A striking feature of informal workers' struggles in the contemporary era is the variety of
organization forms that informal workers have utilized to address their needs. These
include unions, labor-based non-governmental organizations (NGOs), service NGOs,
mutual aid societies, worker centers, community organizations, and cooperatives.

Brazil deserves attention for its success in building cooperatives with government
support; South Korea offers an interesting model of regional unions. The US and Canada
are notable for their Worker Centers, which fuse elements of labor NGOs, service NGOs,
and traditional unions. These organizations at times collaborate with traditional unions
and provide services for informal workers and for undocumented immigrants. South
Korea's and China's examples of symbolic public dramas through crane protests are
unique and fascinating, especially in an age where so many of the world's workers—
informal and formal— have made a more pragmatic turn out of fear of losing employment
altogether. Finally, India has been especially innovative in launching welfare boards.

Important questions remain as to when these varying forms of organizations can form
coalitions versus when they compete for scarce resources, and how the organization type
affects workers' success and strategy. Further research needs to examine whether the
diversity of organization type is related to country contexts. We should particularly
examine which country contexts foment vs. deter organization among informal workers.
16
 Incorporating Informal Workers into Twenty-First Century Social Contracts
Rina Agarwala

For example, although Mexico displays similar political economic patterns as Brazil and
India, it offers strikingly fewer examples of informal workers' organizations.

Informal Workers are formulating bridges with formal labor and

other social movements

Another significant characteristic of informal workers' movements has been the

innovative ways they have used to established bridges between labor movements and
identity-based social movements (such as those around gender, race and caste). Part of
this tendency is due to necessity—in many countries informal workers have no legal right
to organize into unions, since they cannot prove their employment relationship.
Therefore, they partner with other existing movements that organize around social
identities in non-union organizational forms. However, a part of this tendency can be
attributed to a mobilization strategy. Informal workers organize marginalized populations
who were often excluded from 20th century labor movements. Addressing their needs
through identity-based movements that articulate gender and race-based identities has
often resulted in higher mobilization rates rather than mobilizing them along class lines,
especially in the current anti-labor era.

In several countries, informal workers have joined hands with immigrant and indigenous
rights movements, such as in the US, Canada, South Africa, and Mexico. One interesting
example is the US-based domestic workers' Caring Across Generations campaign, which
links improving pay and working conditions for homecare workers with immigration
reform, proposing the creation of special visas for homecare workers to meet the growing
demand for homecare work. This campaign not only bridges efforts between informal
workers and immigrant movements, it includes the Service Employees International
Union; the American Federation of State, County and Municipal Employees; and the
American Federation of Labor and Congress of Industrial Organizations (AFL-CIO).
Among street vendors in the US, VAMOS is directly engaged in the immigrant rights
movement on behalf of its largely undocumented membership, and participates in
marches and protests with that movement. Furthermore, several campaigns in the US have
been initiated to help new immigrant workers in construction. In New York, New Jersey,
and Texas, these campaigns have been initiated through partnerships between unions and
worker centers, including the establishment of new union locals with worker center
representation in the leadership. Similarly, Mexican street vendors, from Mexico City's
Alameda Central, have combined street vending rights with indigenous rights and
preservation of the cultural tradition of selling in public space. In South Africa, faith-
based organizations have been assisting immigrants with various services, including job
referrals and legal advice.

Faith-based organizations are particularly notable as a locus of partnerships in their own

right, as are youth movements. US campaigns aiming to increase publicity on sweatshop
conditions in the garment industry have appealed with moderate success to religious
leaders. Similarly, in South Africa, faith-based associations in churches and mosques
have achieved the greatest success in attracting support among subcontracted and home‐
based garment workers. Christian organizations in India were among the first to protect
low-caste domestic workers. Moreover, South Korea, the US, and China reflect
interesting examples of informal workers partnering with student groups.

Contrarily, informal workers in India and Brazil do not appear to be using bridges with
social movements as a primary strategy. Rather, informal workers appear to be relying
more on unions that expand their demands to include civic and community needs of
17
UNRISD Working Paper 2018–13

citizenship, rather than partnering with another movement that is addressing civic, but not
labor needs. Given this trend, an important area for future research will be to identify
when and why informal workers choose to build or avoid a bridge or partnership with
another social movement.

Conclusion
This paper aimed to provide a theoretical framework for understanding the political
economy of informal workers. Particularly, it offered a new definition of "informal
workers" focusing on the mass of workers operating outside the narrow regulations of
traditional labor laws, which in turn protect only those operating within the Standard
Employment Relationship. Informal workers operate in non-standard employment
relationships and are thus unprotected by most 20th century social contracts. However,
they remain embedded in complex and inter-dependent social relationships with formal
workers, employers, and states. Moreover, they are often regulated by other state laws.

Second, this paper offered a historical and global framework to examine informal workers
under neoliberalism. Informal work is not a product of neoliberalism; it has long existed
to subsidize and boost capitalist growth, especially in developing countries. However, it
has grown over recent years due to the political framework guiding neoliberalism. In the
process, informal workers have ironically become a driving force of counter-movements
designed to reshape the contemporary welfare state. Findings from examining budding
informal workers' movements across eight countries (Brazil, Canada, China, India,
Mexico, South Africa, South Korea, and the US) suggest that the world's poorest workers
may be mobilizing to catalyze a transformative social process that can potentially re-
shape 21st century social contracts.
This paper highlights the institutions and organizations that interact with and through
informal workers' movements and the laws, regulations and programs affecting informal
workers. Informal workers' movements show remarkable commonalities across national
contexts. Rather than fighting to be formally recognized through a standard employment
contract and protected by employers at the work place (as they did at the turn of the 20th
century), informal workers today are fighting to redefine the categories of "workers" and
"employers" to include a range of employer-employee relationships and workplaces. By
expanding these definitions, these workers are increasing the numbers and diversity of
potential beneficiaries of labor rights. Informal workers' movements include women,
ethnic and racial minorities, and occupations often excluded from the definition of
"workers" protected by 20th century social contracts. Redefining "work" to bring these
groups into the fold of workers' movements is not part of an organizational strategy to
achieve utopian democracy, as many scholars of SMU have surmised; instead, it is a
"mobilizational necessity" due to the failures of 20th century social contracts.

18
 Incorporating Informal Workers into Twenty-First Century Social Contracts
Rina Agarwala

References

Agarwala, Rina. 2006. "From Work to Welfare: A New Class Movement in India."
Critical Asian Studies 38(4):419-45.
—. 2009. "An Economic Sociology of Informal Work: The Case of India." Research in
the Sociology of Work 18:315-42.
—. 2012. "The State and Labor in Transnational Activism: The Case of India." Journal
of Industrial Relations 54(4).
—. 2013a. Informal Labor, Formal Politics and Dignified Discontent in India. New
York: Cambridge University Press.
—. 2013b. "Inventory of Informal Worker Organizations: India." Unpublished Working
Paper for EOIW.
—. 2013c. "A Second Marriage? An Intersection of Marxism and Feminism among
India’s Informal Workers." in Handbook on Gender in South Asia., edited by
Leela Fernandes. London: Routledge.
—. 2014. "Informal Workers’ Struggles in Eight Countries." Brown Journal of World
Affairs XX(11):251-63.
---. 2016. "Redefining Exploitation: Self-Employed Workers’ Movements in India’s
Garments and Trash Collection Industries." International Labor and Working
Class History 89(Spring):107–30.
—. 2018. "The Employment Relationship and Movement Strategies among Domestic
Workers in India." Critical Sociology.
—. Forthcoming. "Re-defining Exploitation: Self-Employed Workers’ Movements in
India." International Labour and Working Class History.
Arrighi, Giovanni. 1978. "Towards A Theory of Capitalis Crisis." New Left Review
I(111):3–24.
Bakan, A.B., and D. Stasiulis. 1997. Not one of the family: foreign domestic workers in
Canada. Toronto: University of Toronto Press.
Berger, Suzanne , and Michael Piore. 1989. Dualism And Discontinuity In Industrial
Societies. Cambridge: Cambridge University Press.
Boris, E., and J. Klein. 2012. Caring for America: home health workers in the shadow
of the welfare state. New York: Oxford University Press.
Breman, Jan, and Marcel van der Linden. 2014. "Informalizing the economy: The return
of the social question at a global level." Development and Change 45:920-40.
Bromley, Ray , and Chris Gerry. 1979. "Who are the Casual Poor?" in Casual Work and
Poverty in Third World Cities, edited by Ray Bromley and Chris Gerry. New
York: Wiley.
Charrad, Mounira. 2001. States and Women’s Rights: The Making of Postcolonial
Tunisia, Algeria, and Morocco. Berkeley: University of California Press.
Chatterjee, Partha. 1993. The Nation and Its Fragments: Colonial and Postcolonial
Histories. Princeton: Princeton University Press.
—. 2006. The Politics of the Governed: Reflections on Popular Politics in Most of the
World. New York: Columbia University Press.
Chun, Jennifer Jihye. 2009. Organizing at the Margins: The Symbolic Politics of Labor
in South Korea and the United States. Ithaca: Cornell University Press.
—. 2014. "The Struggles of Iregularly-Employed Workers in South Korea, 1999-2012."
Unpublished Working Paper for EOIW.
Cranford, Cynthia J., Leah F. Vosko, and Nancy Zukewich. 2003. "Precarious
employment in the Canadian labour market: A statistical portrait." Just Labour
3.

19
UNRISD Working Paper 2018–13

Cross, John. 1998. Informal Politics: Street Vendors and The State in Mexico City.
Stanford: Stanford University Press.
Davis, Mike. 2006. Planet of Slums. New York: Verso.
De Soto, Hernando. 1989. The Other Path: The Informal Revolution. New York: Harper
and Row.
Economist. 2015. "Advancing, not retreating: Forcasts of the decline of capitalism are
premature." Pp. 52 in Economist.
Esping-Anderson, Gosta. 1990. The Three Worlds of Welfare Capitalism. Princeton:
Princeton University Press.
Fine, Janice. 2006. Worker centers : organizing communities at the edge of the dream.
Ithaca: Cornell University Press.
Fine, Janice, and Rachel Meyer. 2013. "Grassroots Citizenship: Rethinking Immigrant
Civic Participation." in Labor and Global Solidarity Conference. New York.
Fine, Janice, and Ruth Milkman. 2013. "US Country Inventory of Informal Worker
Organizing." Unpublished Working Paper for EOIW.
Fraser, Nancy. 1995. "From Redistribution to Recognition? Dilemmas of Justice in a
Post-Socialist Age." New Left Review 1(212):68-93.
Friedman, Eli. 2014. "Alienated Politics: Labour Insurgency and the Paternalistic State
in China." Development and Change 45(5):1001–18.
Garza, Enrique de la. 2013. "Mexico informal worker organizing inventory."
Unpublished Working Paper for EOIW.
Gottfried, Heidi. 2015. A reproductive bargain: deciphering the enigma of Japanese
capitalism. Leiden: Brill.
Gugler, Josef. 1991. "Political Responses to Poverty." in Cities, Poverty, and
Development: Urbanization in the Third World, edited by Alan Gilbert and Josef
Gugler. Oxford: Oxford University Press.
Harris, J. , and M. Todaro. 1970. "Migration, Unemployment and Development: A Two
Sector Analysis." American Economic Review 40:126-42.
Hart, Gillian. 2002. Disabling Globalization: Places of Power in Post-Apartheid South
Africa. Berkeley: University of California Press
Hart, Keith. 1973. "Informal income opportunities and urban employment in Ghana."
Journal of Modern African Studies 11:61-89.
Harvey, David. 2005. A Brief History of Neoliberalism. Oxford: Oxford University
Press.
Hatton, Erin. 2014. "Temporary weapons: employers’ use of temps against organized
labor." Industrial & Labor Relations Review 67(1):86–110.
Hussmanns, Ralf. 2002. "A Labour Force Survey Module on Informal Employment: A
Tool for Enhancing the International Comparability of Data." in paper presented
at 6thMeeting of the Expert Group on Informal Sector Statistics (Delhi Group).
Rio de Janeiro.
Hyman, Richard. 1992. "Trade unions and the disaggregation for the working class." in
The Future of Labour Movements, edited by M. Regini. Newbury Park: Sage.
ILO-WIEGO. 2013. "Women and Men in the Informal Economy: A Statistical Picture."
ILO. 1993. "Report of the 15th International Conference of Labour Statisticans." in 15th
Internatonal Conference of Labour Statistcians. Geneva.
—. 2013. "Global Employment Trends 2013: Recovering from a second jobs dip."
Geneva: International Labour Organization.
Langford, Tom, and Zia Rahman. 2010. "The Limitations of Global Social Movement
Unionism as an Emancipatory Labour Strategy in Majority World Countries."
Socialist Studies: the Journal of the Society for Socialist Studies 6(1):45-64.
Lenin, V.I. 1939. Imperialism, the Highest Stage of Capitalism. New York:
International Publishers.

20
 Incorporating Informal Workers into Twenty-First Century Social Contracts
Rina Agarwala

Lewis, WA. 1954. "Economic Development with Unlimited Supplies of Labour." Pp.
139-91. Manchester: Manchester School 22.
Luxemburg, Rosa. 1951. The Accumulation of Capital. London: Routledge and Kegan
Paul Ltd.
Marx, Karl. 1976. Capital, Volume I. London: Pelican Books.
Milkman, Ruth , and Veronica Terriquez. 2012 "We Are the Ones Who Are Out in
Front': Women's Leadership in the
Immigrant Rights Movement." Feminist Studies 38(3 ):723-52.
Milkman, Ruth, and Ed Ott (Eds.). 2014. New Labor in New York: Precarious Workers
and the Future of the Labor Movement. Ithaca: Cornell University Press.
Moore, Barrington. 1966. Social Origins of Dictatorship and Democracy: Lord and
Peasant in the Making of the Modern World. Boston: Beacon.
Moser, Caroline. 1978. "Informal Sector or Petty Commodity Production: Dualism or
Dependence in Urban Development?" World Development 6(9/10):1041-64.
Mosoetsa, Sarah. 2012. "The state of informal workers’ organisations in South Africa."
Unpublished Working Paper for EOIW.
Ngai, Pun, and Tong Xin. 2012. "China’s informal labor and labor organizing."
Unpublished Working Paper for EOIW.
Omvedt, Gail. 1993. Reinventing Revolution: New Social Movements and the Socialist
Tradition in India. Armonk: ME Sharpe Inc.
Peattie, Lisa R. 1987. "An Idea in Good Currency and How it Grew: The Informal
Sector." World Development 15(7):851-58.
Polanyi, Karl. 2001. The Great Transformation. Boston: Beacon Press.
—. [1944] 2001. The Great Transformation. Boston: Beacon Press.
Portes, Alejandro, Manuel Castells, and Lauren A. Benton. 1989. The Informal
Economy: Studies in Advanced and Less Developed Countries. Baltimore: Johns
Hopkins University Press.
Portes, Alejandro, and William Haller. 2005. "The Informal Economy." Pp. 403-25 in
Handbook of Economic Sociology, 2nd edition, edited by Neil Smelser and
Richard Swedberg. Princeton: Princeton University Press.
Portes, Alejandro, and John Walton. 1981. Labor, Class and the International System.
New York: Academic Press.
Rakowski, Cathy A. 1994. Contrapunto : The Informal Sector Debate in Latin America.
Albany: State University of New York Press.
Riley, Dylan J., and Manali Desai. 2007. "The Passive Revolutionary Route to the
Modern World: Italy and India in Comparative Perspective." Comparative
Studies in Society and History 49 (04).
Rodgers, Gerry. 1989. "Precarious work in Western Europe: The state of the debate." in
Precarious Jobs in Labour Market Regulation: The Growth of Atypical
Employment in Western Europe, edited by Gerry Rodgers and Janine Rodgers.
Brussels: International Institute for Labour Studies, Free University of Brussels.
Romero, Mary. 1992. Maid in the USA. New York/London: Routledge.
Rueschemeyer, Dietrich, Evelyne H. Stephens, and John D. Stephens. 1992. Capitalist
Development and Democracy. Chicago: University of Chicago Press.
Salas, Carlos, and Lucas Kerr. 2013. "Brazil: Country Literature Review." Unpublished
Working Paper for EOIW.
Satpathy, Anoop. 2004. "Size, Composition and Charaterisitcs of Informal Sector in
India." in National Labor Institute Research Studies Series. New Delhi: V.V.
Giri National Labour Institute.
Srinivas, Smita. 2010. "Industrial welfare and the state: nation and city reconsidered."
Theory and Society 39(3-4):451-70.

21
UNRISD Working Paper 2018–13

Standing, Guy. 2011. The Precariat: The New Dangerous Classes. Huntington:
Bloomsbury Publishing PLC.
Thompson, E.P. 1966. The Making of the English Working Class. New York: Vintage
Books.
Tilly, Chris, Rina Agarwala, Sarah Mosoetsa, Nai Pun, Carlos Salas, and Hina Sheikh.
2013. "Informal worker organizing as a strategy for improving subcontracted
work in the textile and apparel industries of Brazil, South Africa, India and
China." Los Angeles: International Labor Affairs Bureau (US Department of
Labor) and UCLA Institute for Research on Labor and Employment.
Touraine, Alain, François Dubet, Michel Wieviorka, and Jan Strzelecki. 1983.
Solidarity: The Analysis of a Social Movement: Poland 1980-1981. Cambridge:
Cambridge University Press.
Vosko, Leah, Mark Thomas, Angela Hick, and Jennifer Jihye Chun. 2014. "Organizing
Precariously-Employed Workers in Canada." Unpublished Working Paper for
EOIW.
Wills, Jane. 2009. "Subcontracted Employment and its Challenge to Labor." Labor
Studies Journal 34(4):441–60.
Wright, Erik Olin. 2002. "The Shadow of Exploitation in Weber's Class Analysis."
American Sociological Review 67(6):832-53.

22