Measuring the Informal Sector in the Philippines

and the Trends in Asia

Dean Jorge V. Sibal
University of the Philippines
School of Labour and Industrial Relations
sibal_jorge@yahoo.com
Paper Abstract
The papers findings show that the informal sector in the Philippines which is composed
of unpaid family workers and own-account workers has declined. This is due to the increasing
number of non-regular (or contractual) workers in the formal sector of the economy which has
been employing workers from the informal sector. This trend, called informalization of labour
was observed in many developing and transitioning economies in Asia and has contributed to the
increasing income inequity between the informal and formal sectors.
The paper is composed of two parts. The first part cites the definition of the informal
sector in the Philippines and compares it with the definition of the International Labour
Organization (ILO). It describes and cites data on the informal sector in the Philippines based on
several surveys and researches. The traditional members of the informal sector (own account
workers and unpaid family workers) have declined from 58 per cent of the employed labour
force in 1980 to 50 per cent in 2005
The second part shows that the percentage decline of workers in the informal sector was
due to the absorption of its members in the formal sector as non-regular or contractual workers.
Dubbed as informalization of labour, the total number of informal sector workers and the nonregular workers hired locally or overseas shows an increasing trend as experienced in the Asia
and the Pacific region.
The paper concludes that the informal sector serves as a source of cheap labour for nonregular employment. Both the informal and non-regular workers earn less than the formal sector
workers, thus increasing further the income inequity between the informal and formal sectors.
The paper recommends an alternative approach to reverse the race-to-the bottom wage
trends by a continuous monitoring and measuring of the condition of workers especially in the
informal sector, skills upgrading of all workers in the formal and informal sectors for labour
flexibility and productivity, and the advocacy and implementation of social compliance standards
at the workplace. Social compliance in the workplace can be achieved through various modesfrom the compulsory state legislations to the voluntary industry accords, promotion of good
practices and continuous improvement in the workplace.

Brief Bio-Data of
PROF. JORGE V. SIBAL
Professor 6 & Dean, UP SOLAIR, 2005-2011
UP School of Labor and Industrial Relations (SOLAIR), Diliman, Quezon City
BSBA 71, Dip. in IR 79, MIR 82, UP Diliman
National Expert, Asian Productivity Organization (APO), Tokyo, Japan
Contract Researcher, International Labor Organization (ILO), Geneva and AKI, DLSU,
Manila
Social Compliance Associate, ECOP, ILO and Verite
Director (2004-05), President (2002-03), Nikkeiren Alumni Association
Secretary, Phil. Industrial Relations Society (PIRS)
Licensed real estate broker & Director, Sibal Realty and Development Corporation
Vice Chair & Trustee, Urban Missionaries Foundation, Inc., 2002-2009
Co-Convenor, Fair Trade Alliance (FTA)
Trustee and Secretary, Philippine Employer and Labor Social Partners, Inc.
Books Authored
Human Resource Development, Industrial Relations and Management in the Philippine
Setting: A Guidebook, 2008
Philippine Labor and the Economy, 2008
Changes and Challenges: 60 Years of Struggle Towards decent Work, 2008 (Editor)
Formerly Affiliate Professor: UP Cebu, School of Management, UP Mindanao, Davao City; and
Management Sciences Div., UP College Baguio
Director, UP SOLAIR Center for Labor & Grassroots Initiatives (CLGI),
2002 Gawad Chanselor awardee for Best Extension Program
Coordinator, UP SOLAIR Labor Education & Extn. Program (LEEP), 1996 Sikap-Gawa
Industrial Peace awardee for training and research by the Bishops-Businessmens
Conference for Human Development & 1996 Gawad Chanselor awardee for
"Pinakamahusay na Pahinungod
Senior Lecturer, MBA Program, UP College of Business Administration
Professor, Graduate Studies in Business and Economics (GSBE) Program, De la Salle
University, Manila & MBA/MPA Program, Philippine Womens University
Director, Sports Development, Quezon City Government
Consultant, Vice Mayors Office, Quezon City
Marketing Consultant, Real Estate Exchange, Inc., Makati
Personnel and Administrative Manager, Black Mountain, Inc., Makati
Project Manager, Bancom Realty Corporation, Makati
Account Manager, J. Walter Thompson Co. Ltd. (Mla.), Manila
President, UP IR Alumni Association-UPAA Chapter
Address:
Bonifacio Hall, UP SOLAIR, Diliman, Q.C., Philippines 1101

Tel-Fax- 9207717, Cell # 0917 6076233, Tel-Res. 411-9226,

E-mail- sibal_jorge@yahoo.com website: http://www.freewebs.com/jorge_sibal