UNDERSTANDING THE INFORMAL ECONOMY: INSIGHTS FROM AZERBAIJAN AND ITS NEIGHBORS

Abstract

Topicality. Informal employment, a critical facet of global labor markets, is characterized by jobs lacking legal or social protection and is often synonymous with precarious working conditions and inadequate earnings.Aim and tasks: The primary aim of this study is to explore and better understand the dynamics of informal employment in various economies. The focus is to gain a comprehensive understanding of its causes, impacts, and the socio economic conditions of workers engaged in informal employment. This understanding is pivotal in formulating effective and inclusive labor policies that can contribute towards reducing informality and promoting decent work conditions.Materials and methods. Literature review, data collection, qualitative and quantitative method, comparative analysis, theoretical approach were used in the study. Studied scientific articles, books, reports and studies that address this issue. This will help to understand current views and research related to the informal economy in the region.Various data sources such as statistical reports, surveys, interviews or observations are used to obtain information on the extent and characteristics of the informal economy in the region. Differences and similarities in the structure, characteristics and influence of the informal economy on socio--economic development in the region are compared.Research results. The investigation into informal employment in Azerbaijan and surrounding nations unveiled its substantial presence in these economies, highlighting the sector's importance in the regional labor markets. Key factors contributing to this prevalence include insufficient formal job opportunities and inadequate labor protections. The research suggests that comprehensive policy interventions, such as bolstering labor laws and social protection measures, could aid in reducing informality and fostering more formalized and decent working conditions.Conclusion. The substantial role of informal employment in Azerbaijan and its neighboring countries underscores a significant economic challenge. Addressing this issue effectively calls for comprehensive policy measures that promote the transition towards formal employment, enhance workers' rights, and provide adequate social protection.