Today, the importance of the informal economy is quite obvious since it is the main employment generator in Latin American countries, where more than 53 per cent of the economically active population of the region is part of this sector. Between 1990 and 2004, the contribution to the informal economy in terms of employment generation increased by 4.6 per cent. According to ILO's data, during the last decade, between 75 and 80 per cent of every 100 new job posts were created by this sector.

As indicated by ILO's Director General in the report prepared for the 16th American Regional Meeting (May 2006): In Latin America, there are 103 million people working in the informal sector -many times without labour rights or social security- which, added to the number of unemployed people, means that 126 million people are affected by formal employment deficit.

The term "informal sector" (also called "non-structured sector") was first used by ILO in a paper called "Employment, incomes and equality: A strategy for increasing productive employment in Kenya" (Geneva, 1972). One of the main conclusions reached by these reports was that the most important social problem in some countries was not unemployment but the existence of a great amount of "poor workers" who produce goods and services while their activities are not acknowledged, registered or protected by public authorities.

In 2002, during the International Labour Conference (ILC), ILO presented a conceptual framework of employment in informal economy which related an enterprise-based concept of employment in the informal economy with a broader concept of employment in the informal economy, based on the job position. As a result, a distinction could be made between employment in the informal economy, informal employment, employment in the informal sector and informal employment outside the informal sector.

The Resolution about decent work and informal economy, discussed during the ILC, stated that it would be better to use the term "informal economy" rather than "informal sector", since it relates to activities of workers and enterprises that cannot be linked to one specific sector of the economy because the activities cover several sectors.

No general agreement has been reached yet about the description or definition of the term "informal economy", therefore, it seems more convenient to explain some of the characteristics that workers and enterprises share in the informal economy.

The informal economy covers a variety of activities and labour relations:

self-employed workers of individual microenterprises with workers that are members of the family, apprentices or wage earners;
auxiliary family member workers, no matter if they work in enterprises of the formal or the informal sector;
members of cooperatives of informal producers;
outsourced home-based work;
own account workers of survival activities (street vendors, waste collection, etc.)

The group is highly heterogeneous and it keeps close links with the formal sector; whatever happens in the informal economy has an effect on the work of the formal economy and viceversa.

One key aspect of informal activities is their vulnerability, since most of the people who work or own an informal enterprise are under conditions of great labour unsteadiness and income uncertainty; besides, they run serious security and health risks.

Particularly in Latin America, it is necessary to highlight the existing relationship between informal economy, poverty and female labour. As indicated in Social Panorama of Latin America 2005 (ECLAC), the region has not advanced in the process of overcoming poverty. On the contrary, it has stagnated: between 1999 and 2002, the poverty rate diminished only 0.4 per cent and extreme poverty increased 0.3 per cent, covering 18.8 of the regional population. The evolution of poverty and indigence was characterised by slight variations. Furthermore, the situation of poverty and indigence, systematically, affects more women than men.

Poverty leads most people to generate or accept a job in the informal economy, and the low income obtained by these job posts, as well as the precariousness and the lack of social protection create a vicious circle of poverty which is very difficult to abandon. At the same time, not only a higher percentage of the female work force, (compared to male work force), works in the informal sector, but also among women, particularly the indigenous and black women are concentrated in the group of lower incomes, the most unprotected and with less chances of organisation and representation of interests.

Therefore, ILO suggests analysing the work in the informal economy based on decent work deficit. And this perspective may be reflected in the new Recommendation 195: Human Resources Development: education, training and lifelong learning, according to which:

"Members should identify human resources development, education, training and lifelong learning policies which: d) address the challenge of transforming activities in the informal economy into decent work fully integrated into mainstream economic life; policies and programmes should be developed with the aim of creating decent jobs and opportunities for education and training, as well as validating prior learning and skills gained to assist workers and employers to move into the formal economy" (art. 3, d)

In this sense, basic education and lifelong training begin to be considered as essential to train people who perform informal activities. They are also crucial to devise strategies to reduce poverty and implement sustainable social and economic development.

Within this context, the sub-site "Informal economy and training" offers a space to deal with all these aspects (since, understanding, tackling and improving the life and working conditions of people involved in the informal economy requires differentiated and concentrated policies) without losing sight of a broader vision that shows all the dimensions of these issues.

The sub-site is structured in the following way:

VTIs and the informal economy: thematic section that describes the actions taken by VTI in Latin America and the Caribbean with respect to training oriented to workers and enterprises of the informal economy.

Informal economy - Decent work - Poverty: on the one hand, it provides documents and analyses about the informal economy, decent work and poverty. On the other hand, it includes the links among different categories as well as the implemented plans and programmes of action to eradicate poverty, reduce decent work deficit and particularly those related to the informal economy.

Informal economy and gender: it presents a number of documents and experiences that offer a different perspective of the informal economy.

Informal economy and vulnerable groups: thematic section that contains documents on programmes oriented to the training of vulnerable groups: women, youth, people with disabilities, ethnic groups.

Informal economy by activity sector: this section offers documents about programmes focused on workers and informal economic units organised by sector. Therefore, the sub-site is divided into plans and programmes of:
a) agricultural sector;
b) industrial sector;
c) services sector.

Documents and publications: section oriented to the introduction of books, documents, reports and regular publications of interest according to the objectives of the site.

Events: Calendar of events related to the issues of the site.

Links: this section includes interesting links to ILO Web sites and other international and national organisations that deal with these issues.