The Small Business Forum
Entrepreneurship and the Informal Sector
- The informal sector comprises two main categories of workers:
- – people self-employed in very small and micro enterprises and not registered.
- – individuals employed in jobs without contract or security, such as domestic workers.
- Some claim that informal businesses perpetuate poverty., that they trap people in low-productivity subsistence-level activities and call for them to be abandoned. The history of many businesses, however, shows that even micro-enterprises can grow to become large companies. Some of the large-scale businesses started at the smallest level.
- The informal sector is also a major source of employment and income generation for the low-income population. It also provides critical links for the formal sector businesses, providing raw materials and distribution outlets.
- From their benefits and prospects, some consider informal businesses entrepreneurial and have labelled them informal entrepreneurship. The challenge then, is how to help the enterprises access the support necessary for growth.
Comments, Questions and Suggestions welcome.
drkibuka@thesmallbusinessforum.co.ke
+254-729524219
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