Informal employment is dwindling in number, but growing in money

Analysts from the Finexpertiza network of companies studied employment data from Rosstat in the second quarter of 2022, finding a decrease in the number of informal sector workers by 1.5 million over the year, to 13.4 million people, or 18.7% of all employed in the Russian Federation. For most of them, work in microbusiness was the only one, only about 6% were employed in the formal sector, the authors of the study note. We are talking about individual entrepreneurs and their employees and employees of businesses without registration as a legal entity.

“The share of informal employment in regional labor markets depends on the general level of well-being, in particular on unemployment: the higher it is, the higher, as a rule, the level of informal employment. Inverse dependence on the level of incomes of the population: they are the lower, the greater the proportion of people working in the informal sector. Informal employment continues to be rather a zone of low prosperity – for the most part, it is characterized by low wages and a variable nature of work, ”conclude the authors of the study. They point out that in the second quarter of 2022, the highest share of informal employment was observed in Ingushetia (56.6%), Dagestan (48.6%) and Chechnya (45.4%), and the lowest in Chukotka Autonomous Okrug (1% ), Moscow (3%) and St. Petersburg (6.7%).

Igor Polyakov from TsMASF notes that the reduction in the number of such employed is taking place against the backdrop of an increase in the number of self-employed in Moscow to 1 million people (due to the “conversion” of small and medium-sized enterprises into the world business; see Kommersant on April 6) and low net migration inflow due to the rate fluctuation. At the same time, at the same time, the share of other cash receipts (it is in them that Rosstat places receipts from informal employment) in the structure of household income in the second quarter of 2022, as Kommersant already noted, increased markedly – up to 12% from 11.5% a year ago and 9 .9% in the second quarter of 2018 (see graph). The volume of such receipts in money is also growing, they add to the CMASF, which, we note, may reflect the process of replacing the former players in this market with new ones from the SME sector. Prior to this, the peak of the share of “other income”, which, according to Mr. Polyakov, is difficult to interpret, since “Rosstat’s wording “informal sector” is vague”, fell on 2014–2015.

Alexey Shapovalov