The informal economy and workers in Nepal

This report marks an important point in debates about Nepal’s informal economy. For the first time, the significance of the informal economy is recognised and the challenges facing workers discussed.

The publication of this new report by the International Labour Organization Office in Nepal, marks an important point in debates about Nepal’s informal economy. For the first time, the significance of the informal economy is recognised and the challenges facing workers discussed.

The report provides a wide-ranging overview of the characteristics of Nepal’s informal economy, particularly in terms of demographics, labour relations, and decent work deficits. In this, the fastest growing and least protected part of the national economy, workers have no guarantees of economic or social security. The current period of political and economic uncertainty in Nepal is contributing to the growth of the informal economy and exacerbating the problems facing workers.

The authors provide a synopsis of the policy and legislative framework as well as trade union and employer initiatives. While the government is poorly equipped to enforce laws that apply in the informal economy, trade unions have limited experience and ability to organise workers. The authors, however, offer a comprehensive set of suggestions for intervention in the informal economy. As a priority, these urge the organisation of workers and a strengthening of enforcement mechanisms.