Where oppor­tun­it­ies for employ­ment in the formal sec­tor are not avail­able, people start their own busi­nesses and carve out space on the road side, beside train lines, in parks and in other pub­lic spaces to trade. This is par­tic­u­larly com­mon in Asia: for example, 72% of work­ers in Indone­sia are employed in the informal sec­tor.

While the informal eco­nomy may provide for many in devel­op­ing nations, the rights of those work­ing in this way are rarely respec­ted, and are often the first to be pushed aside in the name of city devel­op­ment, or as has occured in Jakarta, in order to reclaim green space. Deden Ruk­mana explores the concept of urban inform­al­ity and the rights of those who exist in legal grey areas.

Street vendors in Malioboro, Yogyakarta, Indone­sia | Photo by mini­anna on Flickr

We often find prob­lems asso­ci­ated with street vendors (ped­agang kakilima) in many Indone­sian cit­ies. Street vendors do their activ­it­ies in the side­walks, city parks, cross walk­ing bridges, and even in the streets. They are often seen as eye-sores and undesir­able activ­it­ies. In many cases, author­it­ies for­cibly evict street vendors in the name of urban order and clean­li­ness. Street vendors often res­ist the evic­tion and demand spaces for their activ­it­ies. Do street vendors deserve urban space for their activ­it­ies? To answer this ques­tion, I would like intro­duce the concept of urban inform­al­ity as a frame­work for under­stand­ing street vendors that occur in urban areas.

The concept of urban inform­al­ity star­ted from the dicho­tomy between the formal sec­tor and the informal sec­tor dis­cussed in the early 1970s. The informal sec­tor is a very com­mon phe­nomenon that occurs in devel­op­ing coun­tries. The per­cent­age of the informal sec­tor in Latin Amer­ica, Sub-Saharan Africa, the Middle East and North Africa and South Asia ranges between 30–70 per­cent of the total workforce.

Ped­agang Dukuh | Photo by T_CHAN on Flickr

In Indone­sia, accord­ing to data from the Stat­ist­ics Cent­ral Bur­eau (BPS) in Feb­ru­ary 2008, 73.53 mil­lion out of 102.05 mil­lion (72%) work­ers worked in the informal sectors.

Although the dis­cus­sions have been con­duc­ted for more than thirty years, there is no con­sensus on the exact defin­i­tion of the informal sec­tor (Malo­ney, 2004). Under­stand­ing of the informal sec­tor is more often asso­ci­ated with the dicho­tomy between the formal and the informal sec­tors. The informal sec­tor is often under­stood from the doc­u­ment issued by the Inter­na­tional Labor Organ­iz­a­tion (1972). The ILO iden­ti­fied at least seven char­ac­ters that dis­tin­guish these two sec­tors: (1) easy of entry, (2) easy to obtain raw mater­i­als, (3) the nature of own­er­ship, (4) the scale of activ­it­ies, (5) use of man­power and tech­no­logy, (6) expert­ise require­ments, and (7) dereg­u­la­tion and mar­ket competition.

The dicho­tomy of the formal and informal sec­tors often ignores the import­ance of the informal sec­tors with respect to urban spaces. The informal sec­tors are often mar­gin­al­ized in the urban spaces, even though the informal sec­tors account for 70% of the urban employment.

Ananya Roy and Nezar Alsayyad (2004) intro­duced the concept of informal urban areas as the logic that explains the pro­cess of urban trans­form­a­tion. They did not emphas­ize on the dicho­tomy of the formal and the informal sec­tors but on the under­stand­ing that the informal sec­tor is parts of the eco­nomic struc­ture of soci­ety. The urban inform­al­ity is an urb­an­iz­a­tion mode that con­nects vari­ous eco­nomic activ­it­ies and space in urban areas, not only a domain for the poor but also import­ant for middle-class population.

Train passing Duri Rail Mar­ket | Photo by chris_railway on Flickr

Two urban the­or­ies, the Chicago School of Urban Soci­ology and the Los Angeles School of Urban Geo­graphy have dom­in­ated the dis­course of urban devel­op­ment in devel­op­ing coun­tries, includ­ing in Indone­sia. Both urban the­or­ies are based on phe­nomenon that occurred in urban cit­ies in the United States. The Chicago School of Urban Soci­ology, which was developed in the early 1920s explain the devel­op­ment of the urban migra­tion that is con­trolled by gen­er­at­ing eco­lo­gical pat­terns, such as inva­sion, sur­vival, assim­il­ated, adapt­a­tion and cooper­a­tion. The Los Angeles School of Urban Geo­graphy ini­ti­ated in the late 1990s to explain the devel­op­ment of met­ro­pol­itan Los Angeles in the post­mod­ern era that emphas­izes the import­ance of the cap­it­al­ist eco­nomic and polit­ical glob­al­iz­a­tion of the economy.

The dom­in­ance of both urban the­or­ies in the dis­course of urban devel­op­ment influ­ences the urban spa­tial plan­ning in devel­op­ing coun­tries. Plan­ning prac­tices that rep­lic­ate both urban the­or­ies through the dicho­tomy of developed and devel­op­ing coun­tries become ubi­quit­ous. This becomes a prob­lem when such a rep­lic­a­tion is no longer rel­ev­ant with the unique urban phe­nomenon in devel­op­ing coun­tries, such as the informal sector.

The prob­lems that arise in con­nec­tion with street vendors is mostly caused by the lack of urban spaces for street vendors. The urban spa­tial plan­ning that is not based on the under­stand­ing of urban inform­al­ity concept will tend to ignore the demand for spaces to accom­mod­ate the informal sec­tor, includ­ing street vendors. In addi­tion, the dom­in­ance of the Chicago and Los Angeles Schools in the prac­tice of urban plan­ning in Indone­sia has con­trib­uted to the lack of spaces for the informal sec­tors in urban areas. The spaces in urban areas are dom­in­ated by the urban sec­tors that have high eco­nomic value and the spaces for the informal sec­tors are marginalized.

Street vendors, or Ped­agang, di Jl. Dr. Soetomo, Indone­sia | Photo by Abdul Manan on Flickr

The applic­a­tion of the concept of urban inform­al­ity in under­stand­ing the phe­nomenon of street vendors will change our per­spect­ive on the exist­ence of street vendors in urban areas. The street vendors are not the groups failed to enter the eco­nomic sys­tem in urban areas. They are one of the modes in the urban trans­form­a­tion that can­not be sep­ar­ated from the urban eco­nomy. They are one com­pon­ent of the urban eco­nomy that will bene­fit urban development.

The phe­nomenon of street vendors in Indone­sian cit­ies should be inter­preted in the con­text of urban trans­form­a­tion. The applic­a­tion of the concept of urban inform­al­ity in the prac­tice of urban plan­ning will alloc­ate more urban spaces for the street vendors and integ­rate it with the formal sec­tors. The prac­tice of urban plan­ning in Indone­sia also should not rep­lic­ate the Chicago and Los Angeles schools, but modify them and take into account the unique urban phe­nomenon includ­ing the informal sec­tor. The informal sec­tors, includ­ing street vendors, deserve more urban spaces to accom­mod­ate their activ­it­ies that are parts of the urban eco­nomic system.

The new spa­tial plan­ning law 26/2007 has stip­u­lated the import­ance of the informal sec­tor in urban areas, but the imple­ment­a­tion of this new law is not fully enforced yet. The full enforce­ment of the new spa­tial plan­ning law and the under­stand­ing of the urban inform­al­ity concept are needed to ensure the avail­ab­il­ity of urban spaces for the street vendors.