**2. Features of informal employment in the Philippines and the health insurance programme by PhilHealth for the informal sector**

This section covers the estimates of the informal economy for the country, its features in terms of demographics, and some context.

### **2.1 The size and magnitude of informal employment**

Using a proxy indicator1 based on its labour force surveys, in the absence of a direct survey, the Philippine's Department of Labour and Employment (DOLE) representative to the Global Knowledge Sharing forum shared the statistics on the informal

<sup>1</sup> Since 2008, there has been no direct survey of the informal economy. During this 2008 Informal Sector Survey (ISS) 29.8 million workers were considered in informal employment or 75% of Filipino workers (WB 2010). Under proxy indicators, there were only 19.4 million informally employed workers considered in 2008, indicating an underestimation of the number of informal workers by nearly 10 million.

*National Health Insurance, the Informal Sector, and Elements of a New Social Contract… DOI: http://dx.doi.org/10.5772/intechopen.103720*

#### **Figure 1.**

*Size of informal employment. Source: Department of Labour and Employment (2018). Size of the Informal Economy in the Philippines [3].*

economy. **Figure 1** shows that from 2008 to 2017, there was an average of 21.1 million workers in the informal economy (estimated by the number of self-employed without paid employees, unpaid family workers, and wage and salary workers in precarious employment). This comprised 56% of the total employment; while workers in the formal economy (estimated by the employer in own family farm or business, and the wage and salary workers with the permanent job or business) were 44% of total employment or an average of 16.1 million workers. The figures include the agricultural sector. This figure of 56% of total employment as informal is relatively lower than the 68.2% regional average, with agriculture and China included, for the Asia and Pacific [4].

Out of the 21.2 million workers in the informal economy in the Philippines, in the 10-year average, the self-employed accounted for 10.8 million (51%), followed by wage and salary workers in precarious employment with 6.5 million (31%), and unpaid family workers with a total of 3.8 million (18%). In 2017, there were 17.62 million workers in formal employment and 22.68 million in informal employment. In the 10 years, informal employment grew by 16.5%.

Informality in employment is expected to increase due to the restrictions on movement and outright lockdown of workplaces and cities due to the pandemic. The Asian Development Bank reported that by January 2021, 1.7 million wage and salary jobs were lost and the informal sector numbers rose to 435 thousand. This was just one year from the start of the pandemic in 2020 [5]. Further surges in infections and movement restrictions as part of pandemic control are likely to see rising numbers of people getting off formal work in favour of more flexible arrangements. While informal work numbers indicated that there are estimated to be comprising the second quintile of families in the distribution of income, working arrangements particularly in the sharing economy sector, such as Uber, Grab drivers and online sellers will see the expansion of the informal sector towards the middle quintiles.
