Informal employment reaches 73% of the Peruvian labour market, one of the highest indicators in Latin America, said the Dean of the School of Sociologists of Peru, Roberto Rodríguez Rabanal.

Thousands of Peruvians have created their own jobs, creating different types of family business as a way to survive.

According to the sociologist and professor of the University Antonio Ruiz de Montoya, despite the limitations the country faces in the productive sector, the informal economy makes a major contribution to the country.

“In average, 5% of small business owner access credits with a 33% rate, while 100% of those who own a large company get those credits with a 5% to 6% rate”, he said, in order to show the problems the sector faces.

According to Rodríguez Rabanal, one of the causes for constant failures to formalize small businessmen lies in the lack of a real work plan that actually takes people into consideration.

“The main cause for this failure is that the formalization process has been implemented from the top to the bottom, never surveying an opinion from the people involved”, he said.

According to Rodríguez Rabanal, there is a general speech among those who want to implement this formalization process, but it does not consider the reality, the real problems of this sector.

 “The second cause is that the different proposals made only consider tax aspects, and do not address their needs”, he said.

This process “must be analysed in terms of an integral development, a social progress, and individual welfare, which demands better services”.

During the last year, around 300,000 formal jobs were created. However, meanwhile, another 400,000 informal jobs were also created.

Every 120,000 new jobs created in the country represent an extra growth point for the Peruvian economy. According to analysis from the Ministry of Economics and Finance, the Peruvian economy is expected to grow 4.2% due to the improvements of mineral prices in international markets.