Informal Businesses

The Enterprise Survey of the Informal Sector (ESIS) is a product of the Enterprise Analysis Unit that measures the characteristics and activities of unregistered businesses. These informal businesses are everywhere in the world, though they are almost always missing from official records, listings of active businesses, and business-level surveys. Building on existing academic research, the ESIS is a rigorous survey that uses an adaptive, geographically based sampling method to fill this data gap. This page provides additional information on the findings, methodology, and coverage of the ESIS.

The indicators presented here provide a snapshot of the informal sector based on the Enterprise Survey of the Informal Sector (ESIS). All survey datasets are available from the data portal

The ESIS data can be used to answer these and other policy questions:

  • Who are the entrepreneurs in the informal sector?
  • What types of informal businesses are prevalent?
  • Why are these businesses not registered?

Over 15,000 interviews were conducted through Enterprise Surveys of the Informal Sector covering 24 cities in 7 countries since 2015. 

Some recent findings

Looking at recently completed surveys in Iraq (1,996 interviews across 4 cities) and India (10,672 interviews across 9 cities), some patterns emerge regarding the informal sector.

In Baghdad, the main business city of Iraq, the most frequently cited reasons for not registering are not wanting to pay taxes (73%) and entrepreneurs see no benefit to registering (71%).  Forty-four percent of informal businesses cite that they lack the information on where and how to register. 

Across 4 cities in Iraq, there is wide variation in the female composition of the workforce in informal sector businesses.  The city of Sulaymaniyah has more female representation, with the average informal business having women in more than 40% of its workforce. On the other hand, the other 3 cities surveyed have women in 10%  and less of its workforce. 

In India, across 9 cities, the sectoral composition of informal businesses is somewhat similar. Services comprise around 90% of the informal sector, with 60-70% taken by retailers. Manufacturers, or businesses that make goods, constitute approximately 10% of informal businesses.