Chapter 1: Introduction
Across the world, many earn monetary income that they do not declare to the state for tax, social security and/or labour law purposes. This work in the shadows is not some minor practice. According to an OECD report, of the global working population of some three billion, nearly two-thirds (1.8 billion) have their main employment in jobs that are not wholly in the declared economy (Jütting and Laiglesia, 2009). However, the prevalence of such work varies across global regions. In South Asia, 82 per cent of the workforce have their main employment in the shadow economy, 66 per cent in sub-Saharan Africa, 65 per cent in East and South-East Asia (excluding China), 51 per cent in Latin America and 10 per cent in Eastern Europe and Central Asia (ILO, 2013a). Moreover, work in the shadow economy takes many forms. Although traditionally seen as largely exploitative, waged employment conducted under (sweatshop-like) conditions for unscrupulous employers, this is but one facet of the shadow economy. Not only are there many forms of waged employment in the shadow economy, ranging from wholly off-the-books, low-paid, sweatshop-like, waged work to more highly-paid forms in which declared employees receive from their declared employer an undeclared (‘envelope’) salary in addition to their declared wage, but there are also a multiplicity of forms of own-account work in the shadow economy.