Informal Employment and Competitiveness of Low-Technology Industries

Recently, most of firms are encouraging to employ informal labour force for reduction of their costs, in order to improve their competitiveness in global markets. These sorts of employees due to decrease labour expenses, thus help to the firm competitiveness, but little training and skill of them decreases competitiveness of firm in global markets. This article studies the effect of flexibility of informal employees on competitiveness of industries with low and medium-low technology. For this purpose, the effect of informal labor flexibility on competitiveness of these industries has been studied through expanding theoretical principles and using panel data within. The results indicate industries with low technology; the firm can use informat labous employement in ezder to improve its competitiveness. (1998-2003)