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Informal market

Informal market

Why should we stop waging war against informal sector actors in Africa?

Cedric Christian NGNAOUSSI ELONGUE To Cedric Christian NGNAOUSSI ELONGUE
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En deviating from international labor standards, sub-Saharan Africa is once again an exception to the rule in defining its own path. Since the majority of economic activities in Africa are informal and nearly 80% of GDP comes from the informal sector, observers and experts were forced to legitimize informality as the norm, that is to say the prism through from which the analysis of African economic systems was to be carried out.

Originally, the economic factor (1) was the main determinant of analysis of the informal sector, the educational and cultural factor (2), however, sheds light on the analysis from another angle.

At the economic level, informality dates back well before independence through foreign direct investment (FDI) from Western countries to the African continent. Countries like South Africa, Kenya and even the Ivory Coast have been able to take advantage of this for some time. In the 80s, the failure of structural adjustment policies (SAP) had devastating effects (reduction of salaries, reduction in the number of civil servants, privatization of national companies, etc.) on the working population. The devaluation of the CFA Franc in 1994 will further weaken the labor market and contribute to the increase in the number of agents working in the informal sector.

In addition, informal activities are not just about survival strategies but about free and conscious choices of African people. There are a number real micro-entrepreneur. It would therefore be interesting to know whether the level of education, and hence of qualification, influences this orientation towards the formal economy. In other words, are workers in the informal sector there deliberately or is it always a stopgap, a spare when there is no way out in the public and private sector?

Pierre Tegoum, will look at the issue, with as an analytical framework Cameroon[1]. It shows that education plays a fundamental role in the professional situation of working people in Cameroon. Integration into the informal sector is mainly determined by the family context. In addition, the probability of entering the informal sector decreases with the level of education, while the probability of being unemployed and entering the formal sector increases with the level of education. From this point of view, a preventive measure to limit the rate of informal workers would consist in improving the accessibility and quality of education, at least up to the first cycle of secondary education.

At the university level, it is necessary to encourage young people and especially women, towards specializations such as engineering, manufacturing industry, construction, exploitation of natural resources and agriculture. The largest employers in Africa are the retail, agriculture and hospitality sectors. Hence the need to make technical and professional skills more attractive and attractive to women and young people.

The precariousness and low or no social security for workers in the informal sector are the main causes of youth disinterest for this crucial sector of African economies. The informal sector now absorbs more than half of the global workforce and covers more than 90% of SMEs. A study of the African Development Bank (AfDB) reveals that in sub-Saharan Africa alone, unpaid employment represents over 80% of total employment for women and over 60% for men. Nine out of ten workers, rural and urban, have informal jobs in Africa.

Beyond the economic and educational factors, we believe that it is also important to consider the socio-cultural dimension. “The vitality of the informal sector can also be explained by the immersion of its practices in the socio-cultural aspects of each country - proximity, solidarity, strong social ties, feeling of family, ethnic, clan, etc. belonging. " reports economist Kako Nubukpo, visiting scholar at Oxford. Indeed, some workers evolve in the informal sector quite simply because it is an intergenerational economic activity, a profession transmitted from a parent to a child. It is therefore difficult for them to imagine themselves in another posture or professional situation.

It is in the light of these factors that we consider it necessary to consider the informal sector as normal in Africa. " A well-functioning labor market is not necessarily synonymous with a formal labor market[2]"Reminds us, in this regard, Martin Rama, in his preface to a study of AFD (2013) on urban labor markets in sub-Saharan Africa. In industrialized countries, labor markets are where supply and demand meet. However, in an African environment where self-employment and micro-entrepreneurship constitute the dominant mode of integration into the labor market, the very boundary between labor supply and demand becomes blurred. Hence the importance of understanding and integrating the informal economy into complexity and its heterogeneity, to make it a real lever for inclusive and sustainable growth for the continent.

Finally, we note that our objective was not to apologize for informality, but to present it as a consequence of inadequate public policies, poor implementation of reforms, excessive interventionism and the fruit of a free choice. Formalization in itself is not to be punished, it is a development objective that will make society more stable ”, an alternative for an inclusive growth model.

[1] Pierre Nguetse Tegoum, “2.2. Analysis of returns to education in the informal sector in Cameroon [40] ”, The informal economy in developing countries, 2012, 1129.

[2] DE VREYER Philippe and ROUBAUD François, eds, Urban labor markets in sub-Saharan Africa, IRD / AFD, Africa Development Forum (Marseille: IRD Éditions, 2013) p. 11.

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