Underground economy, parallel economy, shadow economy, informal sector, so many words to describe the same reality: hidden work. It progresses and encompasses various situations. Florence Weber, professor of sociology and social anthropology at the École normale supérieure, sheds light on the reasons for this phenomenon.
Who are these informal workers?
Hidden work is very heterogeneous and includes various undeclared activities, whether wage employment or self-employment. These situations present distinct issues. In the case of salaried work, the issues are mainly on the side of employers and undocumented workers, who prefer not to be declared, or have no other choice than not to declare themselves. These workers are often migrants, sometimes exploited by other migrants, as in the textile industry. Some sectors operate on the principle of community, relying on trust, shared language, etc., which can lead to severe forms of exploitation. Unequal asymmetry between employer and employee.
For workers, this results in the absence of social rights and pension schemes. On the other hand, for self-employment, the issues vary. The self-employed worker may be encouraged not to declare their income in order to avoid paying taxes. There may also be an agreement between the self-employed worker and the client to avoid paying VAT, or there may be complementary activities which constitute a non-essential additional income for the person. Salaried workers who carry out an undeclared activity represent around three quarters of the total informal workers, while a quarter of the people concerned are self-employed.
Which sectors are most affected?
Since the Covid pandemic crisis, construction, traditionally a major branch of the informal sector, represents more than 65% of the offenses noted by the URSSAF. Historically, the hotel cafe restaurant sectors were also important, although its importance has declined slightly. This is linked to controls, the drop in consumption due to Covid, and a possible postponement of activities towards informal actors at home. Home activities are more difficult to monitor. Home help, including childcare and care of the elderly, is heavily affected by informal work, despite the incentive measures put in place by successive governments. We are also observing a development of the informal economy on digital platforms, or in services between individuals. A portion of undeclared informal employees is made up of people without papers, or in sectors where employers prefer to have employees without paying charges.
What are the consequences for these workers?
For individuals who engage in the informal sector, if their main status is that of employee, then they benefit from the social protection linked to their salaried activity. Thus, their informal activity generally has limited consequences, rather constituting additional income. However, as soon as they find themselves in more difficult situations, such as unemployment or RSA, the multiplication of controls and regulations encourages people to avoid additional declarations. For these people, devoid of any protection, the situation is dramatic: no health insurance, no retirement, and absence of social rights. This has led to dramatic situations for a long time.
Tax and social fraud is estimated at 120 billion, a fifth of which is linked to undeclared work. Are these considerable losses of income for the State in terms of social protection?
I still have doubts about the consequences on the economy. I am told that this leads to losses for the State in terms of social protection, but in reality, there are numerous measures aimed at freeing employers from employer contributions. During periods when social contributions have been largely reduced for employers, I do not really understand how this differs from hidden work, given that employers do not pay social contributions.
2024-02-26 00:13:44
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