According to the International Labor Organization (ILO), more than six workers out of ten and four enterprises out of five in the world belong to the informal economy [1
]. In accordance with the ILO [2
], approximately two billion workers worldwide, who constituted 61.2% of the global workforce in 2016, were informally employed. Among these, 51.9% was in the informal sector, 6.7% in the formal sector and 2.5% in the household unit. Moreover, developing and emerging countries, with comparatively low socio-economic development levels, occupied 93% of the global informal employment. Overall, 69.6% of the employment in these countries was informal employment, in contrast to only 18.3% in developed countries. Furthermore, informal employment accounted for 85.5% of total employment in Africa, 68.2% in Asia and the Pacific, 68.6% in the Arab States, 40.0% in the Americas, and 25.1% in Europe and Central Asia. The ILO [2
] also depicts that own-account worker is the largest group of informal employment globally and regionally. Agriculture, with 93.6% of informal employment, is the sector with the highest rate of informality, followed by industry with 52.2% and services with 47.2%. The study further reveals that informal employment exists not only in the informal, but also in the formal sector and household sector. In other words, informal employment is a very widespread phenomenon in the economy and society. Formal and informal work are not clearly separated into two worlds, but are interconnected [3
Understanding the situation of informal employment well requires clear and internationally comparable definitions. Over the decades, the definition and concept of informal employment have been developed and described from different viewpoints. In accordance with the ILO, informal employment is defined as “the total number of informal jobs, whether carried out in formal or informal enterprises, or the total number of persons engaged in informal jobs during a given reference period” [4
]. It defines informal employment in a quantitative manner and reflects a statistical concept of informal employment.
Another definition of informal employment was presented at the 17th International Conference of Labor Statistics (ICLS). “Employees are considered to have informal jobs if their employment relationship is, in law or in practice, not subject to labour legislation, income taxation, social protection or entitlement to certain employment benefits (advance notice of dismissal, severance of pay, paid annual or sick leave, etc.)” [5
]. Ahn and Ahn [6
] define informal employment as “jobs or activities in the production and sale of commercial goods and services that are not regulated by law”. The above two definitions of the ICLS and [6
] are similar, because both define informal employment in terms of the quality of informal employment.
In the present study, we use the following detailed definition of informal employment, which defines informal employment in a more concrete way. Before this, we would like to describe the definition of employment. The Cambridge Dictionary says employment is the fact of someone being paid to work for a company or organization. This is a general definition of employment. The ILO defines employment as people of working age who are reported to produce goods or provide services for at least one hour for pay or profit or have a work from which being absent is only temporary [7
]. This definition talks about employment from the standpoint of formal work. On the contrary, informal employment comprises [8
Those in the informal economy who own and operate economic units, including (i) own-account workers, (ii) employers and (iii) members of cooperatives and of social and solidarity economy units.
Contributing family workers, irrespective of whether they work in economic units in the formal or informal economy.
Employees holding informal jobs in or for formal enterprises, or in or for economic units in the informal economy, including, but not limited to, those in subcontracting and in supply chains, or as paid domestic workers employed by households.
Workers in unrecognized or unregulated employment relationships.
Forest plays an important role in the economy and society and is an important source of food, fuel wood, construction material and medicinal products, specifically for the rural population. Particularly in developing countries, informality, low productivity and wages, as well as hazardous working conditions are features of labor in the forest sector. Estimates in 2011 revealed that 13.2 million people across the world were formally employed in the forest sector, which includes roundwood production, wood processing and pulp and paper [9
]. At least additional 41 million, accounting for 75% of total forest-related employment, was employed in the informal forest sector during the same time period.
Employment in general is the dominant source of income for the majority of the population. It may determine the standard of living and drive economic development [10
]. Paying attention to informal employment in the forest sector is compliant with ILO’s Decent Work Agenda and the United Nation’s 2030 Agenda for Sustainable Development. The transition from informal to formal employment is consistent with the Sustainable Development Goal 1 “End poverty in all its forms everywhere”, Goal 5 “Achieve gender equality and empower all women and girls”, and Goal 8 “Promote sustained inclusive and sustainable economic growth full and productive employment and decent work for all” and can help the realization of other goals in these programs.
To the best of our knowledge, no effort has been made yet to literature review and analysis of the magnitude, causes, characteristics and socioeconomic effects of informal employment in the forest sector. The paper attempts also to identify research gaps related to informal employment in the forest sector on a global scale. Hence, a scoping literature review is conducted. The scoping review method was selected, since it has been developed to review and analyze rather broad topics [11
]. The research questions of this literature review are:
How did the magnitude of informal employment in the forest sector (forestry and logging, wood industry and paper industry) change over time?
Which factors cause and characterize informal employment in the forest sector?
What are the socioeconomic effects of informal employment in the forest sector?
The results of our literature review and analysis should help to identify starting points and provide guidance for research on informal employment in the forest sector. The outline of this paper is as follows. Section 2
describes the methodology used in our study. Section 3
presents the results of the literature review and analysis of the dynamics, causes and characteristics of informal employment in the forest sector as well as decent work. Section 4
discusses our main results followed by the conclusion.
4. Discussion and Conclusions
The literature review revealed that there is very little empirical information available about informal employment in the forest sector. The majority of publications are grey literature published by international organizations. However, the information provided in the grey literature meets the standards of good scientific practice. The internal quality control procedures of international organizations like FAO and the ILO comprise external reviews by scientists prior to the publication of a paper.
There is a very limited number of peer-reviewed papers about informal employment in the forest sector. This is in contrast to the number of publications about informal employment in general. Since there is only limited information available about the causes and characteristics of informal employment in the forest sector, one often has to deduct its causes and characteristics from other sectors assuming that they are comparable.
Based on the information available we can conclude that in terms of quantity, informal employment is very severe in the forest sector on a global scale. The majority of workers in the forest sector is informally employed, especially in developing and emerging countries. With regard to severity, informal employment in the forest sector is found both in emerging and developing countries as well as in developed countries. Although developed countries have high economic and social standards, informal employment, in general and in the forest sector, is still not eliminated.
The recent publication by Lippe et al. [45
] gives evidence that visible employment in the forest sector has reached 21 million people full-time equivalents (FTE) in the forest sector, including forestry and logging, wood industry and paper industry. Invisible employment, which is at the same time often also informal employment, encompassed 36–66 million people FTE in 2015. The authors define visible employment as the number of employments that is captured in the official employment statistics. Invisible employment refers to employment that is not officially recorded in labor statistics. This number could include informal employment, formal employment and subsistence workforce. Based on the analysis, the majority of invisible employments are likely to be informal and subsistence.
Our literature review found that a fundamental problem for analysis of informal employment in the forest sector is the inconsistent and fragmented statistical data on informal employment as well as on OSH. Time series of the statistics are often disrupted and the number of countries, for which data about informal employment in the forest sector is available, is limited. This result is consistent with the statement in the reviewed literature [14
]. And this is specifically true for Africa as well as Asia and the Pacific [29
]. Hence, statistical analysis of informal employment is even a greater challenge in developing countries and regions where the forest sector is dominated by informal employment [45
On top of that, the information and data on occupational accidents and illnesses in the forest sector are also very hard to acquire from developing countries [13
]. This reflects that insufficient attention has been given to the problem in developing countries. Without sound data, it will be difficult to address the underlying problems and to improve OSH in developing countries. Insufficient statistical data on informal employment as well as on occupational accidents and illnesses in the forest sector restrict thorough research and analysis on these problems.
It is evident that data collection on informal employment in the forest sector should be widely encouraged. However, publications analyzed do not provide recommendations on how to acquire more and better data about informal employment in the forest sector. We believe that better coordination and harmonization of data collection efforts on international, regional and national level would improve data availability and quality. Hence, organizations and governments should coordinate their efforts and harmonize data collection protocols to close data gaps. Data collection should be supported specifically in developing and emerging countries, which have extensive informal employment in the forest sector, and in countries whose information and data on informal employment in the forest sector is not fully disclosed.
Regarding causes and characteristics, poverty, lack of education and migration are relevant in general and in the forest sector. The publications analyzed, however, are rather descriptive and not supported by systematic research. Interdependencies between causes or regional differences are yet to be discovered and analyzed on the basis of empirical research.
A prominent difference between the forest sector and many other sectors is its high rate of occupational accidents and illnesses. Decent work deficits are even more severe for informal workers in the forest sector. Skill development, provision of safety equipment and working environment as well as general improvement of decent work in the sector need to be strengthened.
Informal employment in the forest sector has both positive and negative socioeconomic effects. By comparison, the negative effects of informal employment in the forest sector, including safety and health of informal workers and working poverty, could be much larger than its positive effect. The positive effects of informal employment in the forest sector, such as providing income to and improving living conditions of workers as well as advancing the development of enterprise and the economy, are usually short-term and temporary, whereas the negative effects could be long-term and very heavy.
Empirical research about socioeconomic effects of informal employment in the forest sector is not reflected in the publications analyzed either because empirical research about socioeconomic effects of informal employment is missing in general or could not be found with the search strings applied. Very few recommendations are published about the mitigation of negative effects. Improvement of income, skill development, training and OSH are promising. However, this is not enough. Clear instructions on how this could be done are required, too.
In order to transform informal into formal employment, international organizations and scholars have proposed plenty of policies and measures to support decent work. However, in the publications reviewed there is no evidence that the policies and measures have been successful in the forest sector. Policies and measures aiming specifically at the forest sector seem to be scarce anyway.
Informal employment in the forest sector has divergent characteristics between countries and regions. Hence, recommendations and guidance on the transition from informal to formal employment introduced by international organizations should be ‘tailormade’ and should consider framework conditions specific to a country or region based on thorough analysis. One-size-fits-all solutions are most likely not successful. Nevertheless, international guidance and policies could be a reference and standard for domestic and local policies and strategies. Consequently, when countries formulate policies on the transition from informal to formal employment as well as on improving decent work, it is not recommended to simply copy and paste policies of other countries or regions.
Unintended consequences are also to be considered. One example from Russia highlights this. With the aim of transforming the economy and strengthening the labor market, the Russian government has made efforts toward tax law, labor law, small and medium-sized business, as well as an institutional reform, which has adversely led to the enhancement of informal employment in the manufacturing and agricultural industries because of the reduction of formal employment in these industries. This is contrary to its original will of increasing formal employment in these sectors [36
Economic growth is not equal to job creation, and a large number of jobs created by economic growth are low paid and poorly regulated [34
] (Section 3.1). That means economic growth alone is insufficient to reduce informal employment and working poverty. Given this circumstance, employment-oriented economic policy, which is aimed at encouraging decent work and poverty reduction, should also balance the whole macroeconomy and benefit the economy and society [34
] (Section 3.1).
Notwithstanding, “economic growth in upper-middle- and high-income countries in the next few years is expected to be driven almost exclusively by productivity growth rather than by employment growth” [35
] (p. 9). This is an unfavorable news for the transition and reduction of informal employment in both the forest sector and other industries. How to balance economic growth and the transition from informal to formal employment needs more attention and effective policies of countries and governments. These policies should not base on sacrificing economic growth or the transition of informal employment, but should coordinate the two aspects and simultaneously benefit the development of decent work and green jobs in the forest sector.