Abstract

Accurate estimation of the informal sector remains a key challenge for official statistical systems, particularly in economies where informal employment represents a substantial share of total employment, such as Egypt where the number of informal workers within economic establishments reached about 4 million, representing about 25% of the total workforce in those establishments which about 15 million workers, in addition to 7 million workers outside the establishments. Traditional enterprise-based surveys often fail to capture large segments of informal economic activity, leading to underestimation and inconsistencies across official statistics.
This research paper examines the methodologies used in Egypt to improve the measurement of the informal sector within the framework of official statistics, with a focus on reducing inaccurate estimates. It reviews key household-based data sources, such as Employment Outside of Establishments Survey, which plays a crucial role in capturing informal employment outside registered establishments, especially own-account workers, construction workers, and street vendors.
The study identifies major sources of bias related to coverage gaps, underreporting, and inconsistencies between labor and national accounts statistics. Building on international statistical standards, the paper proposes an integrated estimation approach that enhances coherence between labor statistics and national accounts. The findings aim to strengthen the accuracy, transparency, and policy relevance of informal sector estimates in Egypt, supporting evidence-based economic planning and monitoring of sustainable development goals.