Evaluating the Participation of Students in the Informal Economy: Some Evidence from a European Survey

Abstract

Despite the widespread assumption that informal employment is more prevalent amongst those not in the formal labour market, there have been no evaluations of the extent and nature of informal employment amongst the student population, who are in most nations a prominent group of those not in formal employment. This paper fills that gap. To do this, a 2007 Eurobarometer survey on informal employment comprising 26,659 face-to-face interviews conducted in the 27 member states of the European Union is reported, which includes interviews with 2,605 students aged 15 or over. The finding is that 1 in 11 (9 percent) of the student population surveyed had participated in informal employment in the previous year, although the propensity to do so varies significantly spatially. Analysing whether they engage in informal employment out of choice or necessity, the finding is that the ratio of involuntary-to-voluntary participation varies both spatially and according to the type of employer for whom they work. Identifying that students comprise 19 percent of the informal workforce in the European union, this survey concludes that greater attention needs to be paid to this group and why they do so if the informal economy is to be effectively tackled.

Keywords: informal economy; undeclared work, shadow economy, underground economy, students, European Union

JEL Classification: O26