• A
  • A
  • A
  • ABC
  • ABC
  • ABC
  • А
  • А
  • А
  • А
  • А
Regular version of the site

Happiness is working for yourself – being “informally” employed, you work less and earn more money

Vedomosti. 14 декабря 2012

In an editorial from the news website www.vedomosti.ru on 14th December 2013 the author considers the conclusions of two research projects from HSE on “informal” employment in Russia which would seem to contradict each other.

More and more Russians are realising that going to the office everyday and following the boss’s orders is no longer obligatory. The informal sector of the labour market is rapidly expanding. According to the Higher School of Economics, one in four Russians already works in it and their number is one and a half times greater than ten years ago. “Informal” workers are those who work literally on the basis of a spoken agreement, without the formality of an employment history book, or a contract, usually temporarily and carrying out one-off commissions. 

So why are people so drawn this unconventional style of employment? In their research “Is it normal to be informal?” Vladimir Gimpleson and Rostislav Kapelyushnikov of the HSE, explain that self-employed people get paid more, compared to all other categories of workers (in terms of hours) and work less. Their calculations show that informal employment promises a bonus of 29-37% on an ordinary salary. Add to this flexibility in the work schedule, managing the work load to suit yourself, none of the stress of having to deal with the boss – it looks like a winner. 

Even so, far from all informally employed people consider themselves that lucky. The authors of another research project at HSE, “Subjective wellbeing of the unconventionally employed”, Tatiana Karabchuk, Marina Nikitina and Natalya Sobolyova, found that people working in the informal sector often feel insecure because of the lack of certainty about their future, or of any guarantees or social benefits and so they feel compelled to search constantly for more work.  

But there are some exceptions; the level of personal satisfaction in life is higher among the informally employed with better qualifications, skills and knowledge. The happiest people, according to the research, are the highly educated self-employed – people, who have their own business and don’t depend on anyone, people who are sure that there is a demand for their services (because they are highly qualified).

The huge informal sector is set to grow and grow. Our government is doing everything needed for that to happen. Unsustainable taxes on salaries and the inflexible demands of labour laws are forcing employers and workers into the shadow economy. Some are even glad about it. Meanwhile the Pension fund and regional budgets are losing the revenues normally supplied by income tax.