4 Ways to Empower the Informal Sector

Over 90% of plastic waste in Vietnam is collected by its informal sector, with an estimated 10,000 to 16,000 waste workers operating daily in Hanoi and Ho Chi Minh City according to a 2023 article. These informal workers are key to turning the tide on plastic pollution, as they contribute significantly to waste management – a key component toward a circular economy – by collecting, sorting, trading, and even processing waste materials.

Similarly in countries such as Brazil and Mexico, up to 80% of plastic waste collection relies on the informal sector, with waste workers forming large communities in metropolitan areas, according to the Alliance’s Plastic Waste Management Framework.

These informal workers often lack a stable income, basic welfare, and good quality of life, in addition to the prevailing and harmful stigma that surrounds the work they do. They could benefit from the help of policymakers, governments, and organisations supporting their role in waste management systems.

The Plastic Cycle project, run by VietCycle and supported by the Alliance to End Plastic Waste, ran from December 2022 to December 2023 and provided nearly 600 waste workers with social welfare support such as housing and health insurance.

Over the year of close collaboration came a few key insights on this often-overlooked sector, and what could be done to recognise their important role in society.

The work that informal waste workers do is physically challenging, often involving long hours and manual labour. Coming into regular contact with waste materials also exposes them to health and security hazards, including sharp materials, germs, and toxic substances. Being informal workers, they often lack access to social health insurance or other government-mandated social safety nets.

With an unstable income and lack of health insurance, these informal workers may not be able to afford medical care, and this could mean entering a vicious cycle of delayed diagnoses and treatment. Providing health insurance could make a huge difference in giving them access to the healthcare system, so they can receive the necessary treatment whenever they are injured or fall ill.

Informal waste workers often have low and fluctuating incomes due to the flexible nature of their work. Many of them leave their rural hometowns and relocate to big cities with more waste and, consequently, higher living costs. This combination of factors limits their housing options, and they tend to end up with poor living conditions, on top of struggling with basic needs such as food and clothing.

If provided housing support such as monthly rental assistance and rental subsidies, informal workers can have better access to more comfortable and convenient housing options. Meanwhile, giving them food and work clothing, such as Personal Protective Equipment (PPEs) can further relieve their financial burden and improve their quality of life.

Life as an informal worker can be very isolating as they move around and spend long hours on the streets collecting waste. As they often work independently, it is difficult and time-consuming to collate enough accurate data to understand the behaviours and habits of informal waste workers, making it challenging for governments to engage with them and develop comprehensive support systems and recommendations to address their needs.

Regular interaction and the development of meaningful relationships with informal workers can create an avenue for discourse, so they may voice opinions on issues they face, and allow policymakers to improve working environments.

At the closing ceremony for VietCycle on 9 January 2024, nearly 100 waste workers shared their experiences with representatives from the Vietnam Women’s Union, the Department of Natural Resources and Environment, the press, and various international organisations. The event was an opportunity for engagement with the workers, and fostered greater understanding of the difficulties and concerns pervading their work.

The informal sector operates without formal regulatory frameworks, which provides flexibility to workers but may expose them to potentially unfair compensation practices. This lack of transparency can lead to informal workers being paid less than market value for their contributions. However, by implementing improved transparency in the value chain, the industry can realise numerous advantages such as strengthening connections between recyclers and collectors, fostering collaboration, and empowering collectors to make more informed pricing decisions.

Entities in the value chain must prioritise fair pricing for informal workers to improve financial security. Enhanced transparency not only strengthens industry relationships but also positively impacts the livelihoods of informal workers while promoting sustainability. Addressing low transparency fosters a more robust recycling ecosystem, benefiting all stakeholders and creating a more equitable and efficient market for recycled plastics, according to a 2023 study by The Circulate Initiative.

Whether it’s waste management for a city, a country, or on a global level, informal workers play a big role. They are key to collecting plastic waste and reducing how much of it leaks into our environment and communities, and to ultimately bring us closer toward achieving a plastic circularity.