DAR ES SALAAM: Informal work supports millions of livelihoods across East Africa. The policy challenge is to match its economic importance with stronger protection, higher productivity and more effective worker representation.

Across East Africa, the informal economy is where millions of people earn their living. Market traders, boda-boda riders, domestic workers, smallholder farmers, mechanics, artisans and cross-border traders keep goods and services moving, often without the contracts, insurance or social-security protections associated with formal employment.

The scale is difficult to ignore. Tanzania’s 2025 labour force findings put informal employment at 95.7 per cent. Kenya’s 2026 Economic Survey recorded 18.1 million informal-sector jobs in 2025, with the sector generating 716,800 of the 822,100 new jobs created that year. Rwanda’s 2025 Labour Force Survey found 81.3 per cent of employment in the informal sector.

The measures differ, but they point in the same direction: informality is deeply embedded in the region’s labour market and remains a major source of employment and household income.

An economy that absorbs workers

Formal employment has not expanded quickly enough to absorb everyone entering the labour market, leaving informal activity to provide opportunities in trading, transport, agriculture, construction, repairs, domestic work and other services.

Informal workers also sit inside many of the same value chains as formal companies. A supermarket product may have passed through a smallholder farmer, independent transporter, trader or aggregator before reaching a registered processor or retailer. Each participant creates value, but access to contracts, insurance, workplace protection and retirement savings can differ sharply.

Access to affordable credit remains difficult. Poor market facilities, unreliable utilities, inadequate sanitation and limited business infrastructure can constrain productivity. Women in cross-border trade may face additional barriers, including restricted access to finance, poor facilities, safety concerns and harassment.

The protection gap becomes clearer when work is interrupted. A salaried employee who falls ill may have medical insurance or paid leave; an independent trader can lose income while carrying the cost of treatment. Injury, maternity and old age create similar risks.

Traditional social-security systems have also struggled because many were designed around predictable salaries and payroll deductions. A farmer may earn seasonally, a boda-boda rider trip by trip and a trader according to daily sales. Systems that ignore those realities risk excluding the workers they are intended to protect.

Organising workers differently

Trade unions are therefore having to rethink representation.

A 2019 International Labour Organization guide documented Tanzania’s TUICO organising more than 10,000 informal workers at the time, including market vendors and boda-boda riders. Informal members paid lower dues while retaining representation rights, while branches engaged municipalities on market access, sanitation, taxation, transport, budgeting and local planning.

Uganda offers another model. NOTU changed its structures to represent informal-economy organisations, while the Amalgamated Transport and General Workers’ Union worked through existing associations rather than recruiting workers individually. The ILO documented agreements with informal-worker associations alongside initiatives involving insurance, safety, finance and social protection.

In Kenya, COTU-Kenya and its affiliates have signed Memorandums of Understanding with informal-worker associations as part of efforts to extend labour rights and representation. COTU-Kenya has also worked with institutions including NSSF and NHIF on initiatives targeting workers in informal transport.

Rwanda provides another approach. CESTRAR has worked through specialised unions, while the Rwandan construction workers’ union, STECOMA, represents construction, wood and craft workers, many operating informally. The Ejo Heza long-term savings scheme, administered by the Rwanda Social Security Board, also provides a route into retirement saving for salaried and unsalaried workers.

In Burundi, COSYBU brings together organisations including the National Federation of Transport, Social, and Informal Workers (FNTT-SI), the National Federation of Informal Manufacturing Workers and Artisans (FNTMI) and the National Federation of Domestic Workers (FNTD).

At regional level, the East African Trade Union Confederation (EATUC) has supported informal-economy organising through manuals, advocacy tools, capacity building and work connected to ILO Recommendation No. 204 on the transition from informal to formal economic activity.

The lesson is practical: informal workers cannot always be organised like salaried employees. Associations, cooperatives, sector unions and flexible membership structures can provide stronger routes to representation where there is no single employer or conventional workplace.

Which way forward?

Governments need to make formalisation worthwhile. Easier registration should come with better access to finance, safer workplaces, healthcare, social-security coverage, fair regulation and infrastructure that allows small enterprises to grow. Formalisation becomes more attractive when workers and businesses can see tangible benefits.

Trade unions can continue organising through sectors, associations and cooperatives while offering services workers can use immediately, including legal assistance, safety education, representation and access to social protection. Social-security institutions, meanwhile, need contribution models that reflect irregular and seasonal incomes rather than assuming every worker earns a predictable monthly salary.

The EAC Secretariat also has an important regional role. Greater portability of social-security benefits, recognition of informal skills and fewer barriers for cross-border workers could make regional integration more meaningful.

East Africa’s informal economy already creates jobs, moves goods, supports formal-sector supply chains and sustains millions of households. The challenge now is to build institutions capable of matching that economic importance with higher productivity, stronger representation and meaningful protection for the people doing the work.