Who Participates in Undeclared Work in the European Union? Toward a Reinforced Marginalization Perspective

Abstract

Representations of who participates in undeclared work have adopted either a marginalization thesis which holds that undeclared work is conducted disproportionately by the unemployed or a reinforcement thesis which holds that it is conducted disproportionately by the employed. Reporting a 2013 survey involving 27,563 face-to-face interviews in 28 European Union (EU) member states, the finding is that those benefitting least from the declared labor market (e.g., the unemployed, younger people, those with financial difficulties) are more likely to engage in undeclared work but receive lower financial gains from declared work than those benefitting more from declared employment. The outcome is a tentative call for a new reinforced marginalization theoretical perspective which holds that although marginal groups are more likely to engage in undeclared work, they gain less from their undeclared work, meaning that the undeclared sphere reinforces the marginalization produced by the declared economy.

Keywords:

• European Union
• Informal economy
• labor market
• marginalization
• shadow economy
• unemployment

Acknowledgments

This work was supported by the European Commission’s Framework 7 Industry-Academia Partnerships Programme (IAPP) under grant no. 611259 titled “Out of the Shadows: Developing Capacities and Capabilities for Tackling Undeclared Work’ (GREY). The usual disclaimers apply.

Additional information

Notes on contributors

Colin C. Williams

Colin C. Williams is a professor of public policy in the Management School at the University of Sheffield in the United Kingdom. His research interests include the informal economy, work organization, and the future of work, subjects on which he has published some 20 monographs and over 400 journal articles over the past 25 years. His recent books include Confronting the Shadow Economy (Edward Elgar, 2014), The Shadow Economy (Institute of Economic Affairs, 2013), and Informal Work in Developed Nations (Routledge, 2010.).

Ioana A. Horodnic

Ioana Alexandra Horodnic is an assistant professor in the Faculty of Economics and Business Administration at the Alexandru Ioan Cuza University of Iasi, Romania. Her current research interests include issues related to labor economics, shadow economy, academic performance, and academic motivation.