Informality, labour transitions, and the livelihoods of workers in Latin America

This paper studies the incidence and heterogeneity of labour informality in six Latin American countries—Argentina, Brazil, Ecuador, Mexico, Paraguay, Peru. We divide workers into five work statuses: formal wage-employed, self-employed, upper-tier informal lower-tier self-employed. evaluate patterns occupational turnover between these statuses assess their impact on wage dynamics. In all countries, wages are highest for lowest jobs. The proportion who maintain status origin or move up job ladder is significantly higher than those transition lower-paying statuses. However, despite high experienced by employees, most failed to ladder. Education plays an important role, as it increases probability transitioning a better and, within informality, chance wages.