Informal economy

Political and business leaders gathering in Davos will discuss ‘resilient dynamism’, but their distrust of informal economies is a missed opportunity.

In belt-tightening times, it’s not surprising that consumption often drops. The UK is a case in point. Happily, consumers there are wasting less too.

The Waste and Recycling Action Programme (WRAP) reported that in the UK, households throw away half a tonne of food-related waste each year (or a third of all household food purchased). This costs the UK approximately £12 billion a year in disposal costs alone – over £1000 per household.

When it’s done, the global tally could be 50 million. So says the International Labour Organization (ILO) about job losses from this recession.

In richer countries, that has meant growing pressure on central government resources, as formal jobs have been lost and draws on government benefits have increased. Estimates include 8 million jobs lost in the US and 1.3 million in the UK.

In developing countries, people are more likely to juggle several jobs than in the developed world. This means underemployment

The ‘slump as opportunity’ concept is alive and well in UK government. Ed Miliband, the country’s Energy and Climate Change Minister, said today that recession will not deflect government efforts to cut carbon emissions and move to a low-carbon economy.