The concept of informal employment is meant to capture employment
relationships that are not governed by formal economic regulations or basic social
protections. There are several justifications for generating estimates of informal
employment. Informal employment is often, but not always, more precarious with lower
earnings. Households which depend on informal employment for their primary source of
income often face higher risks of poverty (Chen, et al., 2005). Therefore, measuring the
prevalence of informal employment is important for understanding the distribution of
economic risks and sources of income inequality, including factors contributing to the
economic vulnerability of women.