Home-Based Workers

Introduction

Home-based work is a growing global phenomenon, with over 100 million people working from their homes (Sinha 2006), in countries both rich and poor. With the rise of complex global chains of production over the past half-century, home-based work has grown exponentially.

The term “home-based worker” refers to the workers who carry out remunerative work within their homes or in the surrounding grounds. It does not refer to either unpaid housework or paid domestic work.Home-based work encompasses a wide diversity, ranging from traditional embroidery and weaving to tele-work. Home-based workers may work in the new economy (assembling micro-electronics) or the old (weaving carpets).

Within the general category of home-based workers, there are two basic types: those who work on their own (the self-employed) and those who work for others (mainly as industrial outworkers). The term “homeworker” is used to refer to the second sub-set of home-based workers: namely, industrial outworkers who carry out paid work from their home. It is important to distinguish, both conceptually and statistically, between the two categories (and related terms):

  • Home-Based Workers: all those who carry out market work at home or in adjacent grounds or premises whether as self-employed or as paid workers
  • Own Account Home-Based Workers: self-employed home-based workers who do not hire others but may have unpaid family members working with them
  • Homeworkers: those home-based workers who carry out paid work for firms/businesses or their intermediaries, typically on a piece-rate basis

Homeworkers may be contracted by a firm, an individual entrepreneur, traders, subcontractors or other intermediaries, are usually given the raw materials and are paid a stated amount per piece produced. They typically do not have any direct contact with the markets for the goods they produce. Self-employed home-based workers are generally in direct contact with the market and buy their own raw materials. Most do not hire others but many are assisted by unpaid family workers.

Historically, home-based work has always included skilled artisan production and entrepreneurial activities as well as low-skilled manual work and survival activities. In recent decades, new forms of home-based work – often involving higher-skills, information technology, and higher-wages – have emerged. Currently, the various forms of home-based work include:

  • Manufacturing and Assembly: sewing, packing, routine assembly
  • Artisan Production: weaving, basket-making, embroidery, and carpet-making
  • Personal Services: laundry, beautician and barber, shoe repair, dressmaking, lodging and catering
  • Clerical Work: typing, data processing, telemarketing, bookkeeping, accounting, call centre telephonists
  • Professional Work: tax accounting, legal advising, design consulting, computer programming, writing, editing, engineering, architecture, medicine

Historically, most home-based work involved manual work in labour-intensive activities: notably, in textiles, garment, and footwear manufacturing industries. Increasingly, home-based work also involves activities in the service and commercial sectors: notably clerical work in data processing, telecommunication, and telemarketing; but also highly skilled professional and technical consulting. As a result, increasing numbers of home-based workers, particularly in developed countries, are in services and trade, not manufacturing. New forms of home-based work have emerged also in capital-intensive manufacturing industries. For example, recent innovations in information and production technologies allow the automobile industry to sub-contract some part of the production process to home-based enterprises and (even) homeworkers. A recent survey of homework in the UK found that specialized firms producing specific components for the automobile industry – including wiring systems, seat cushions, and waterproof covers – sub-contract to homeworkers (Tate 1996).

Around the world, women are over-represented among home-based workers, especially among homeworkers engaged in manual work. Available evidence suggests the following common global patterns: women are more likely than men to work mainly at home; women are more likely than men to work at home in manual activities; and among home-based workers women are far more likely than men to be engaged in low-paid manual work, especially homeworkers (Chen et al. 1999; Felstead et al. 2000). The available evidence also suggests that women home-based workers in manual jobs, especially homeworkers, are among the lowest paid workers in the world (Charmes 1998; Sethuraman 1998; Felstead et al. 2000; Chen & Snodgrass 2001).

To see the latest news from around the globe on home-based workers, visit WIEGO's news section about home-based workers.

Size & Significance

Available statistics for developed countries suggest that a significant and probably growing number of workers are home-based: probably more than 100 million workers, as noted earlier. Available statistics for developing countries suggest that over 10 per cent of non-farm workers in most countries and as high as 20-25 per cent in some countries are home-based. In sum, estimates suggest that there are more than 100 million home-based workers worldwide and that home-based work appears to be on the rise around the world.

Developing Countries: Working at home has always been the reality of work for many people in developing countries. However, statistics on this phenomenon remain very poor. A compilation of official data from the early to mid-1990s on home-based work in 14 developing countries suggested that there is considerable variation in the incidence of home-based work. In Benin, which has made special attempts to improve its official statistics in this area, the share of home-based work in non-agricultural employment was very high (66%). In seven of the countries, home-based workers represented between 10 to 25 per cent of the non-agricultural workforce: Guatemala (26%), India (16%), Kenya (15%), Mexico (17%), Philippines (14%), Tunisia (11%), and Venezuela (18%). In one of these countries, the Philippines, only homeworkers were counted, while in Guatemala, India, Kenya, Mexico, Tunisia, and Venezuela attempts were made to count all home-based workers, both those who are self-employed and homeworkers.

In the other six countries, the share of home-based workers in non-agricultural employment was quite small: Brazil (5%), Chile (just under 2%), Costa Rica (5%), Morocco (4%), Peru (5%), and Thailand (2%). However, for two of these countries – Chile and Thailand – only homeworkers were counted; in the other four – Brazil, Costa Rica, Morocco, and Peru – only the self-employed were counted.

Table 1
Home-Based Workers in Fourteen Developing Countries:

Number, Share of Non-Agricultural Employment, Proportion Women

TOTAL HOME-BASED WORKERS

COUNTRIES/CATEGORIES OF WORKERS

Number of Home-based Workers

Per cent of Non-Agricultural Workforce

Women as
Per cent of Total

1. Only Homeworkers
 Covered

 

 

 

Chile (1997)

79,740

 2

82

Philippines (1993-5)

2,025,017

14

79

Thailand (1999)

311,790

 2

80

2. Only Self-Employed
 Covered

 

 

 

Brazil (1995)

2,700,000

 5

79

Costa Rica (1997)

48,565

 5

45

Morocco (1982)

128,237

 4

79

Peru (1993)

128,700

 5

35

3. Both Categories Covered

 

 

 

Benin (1992)

595,544

66

74

Guatemala (2000)

721,506

26

77

India (1999-2000)

23,496,800

17

44

Kenya (1999)

777,100

15

35

Mexico (1995)

5,358,331

17

43

Tunisia (1997)

211,336

11

38

Venezuela (1997)

1,385,241

18

63

 

Source: Jacques Charmes, 2002. Personal compilation of the author on the basis of official labour force statistics and national accounts. A subset of these data was published in On Measuring Place of Work, Geneva, ILO Bureau of Statistics, 2002.

 

In South Asia, there are at least 50 million home-based workers, according to the Kathmandu Declaration . In most South Asian countries, home-based workers account for a majority share – 60 to 90 per cent – of selected key export industries, including: the agarbati and bidi industries in India, the football industry in Pakistan, and the coir industry in Sri Lanka (Carr and Chen 2000). In India, the NSS Employment and Unemployment Survey (1999-2000) estimated that homeworkers alone numbered nearly 8.2 million in that country, representing about 7.4 per cent of unorganized or informal non-agricultural workers (Government of India 2007).

Home-based work has increased in many countries. As seen in Table 2 below, a study from the Government of India (GOI) found a 15 per cent increase in female workers operating from their own dwelling between 1999-2000 and 2004-05 – the largest percentage increase for any place of work for female workers.

 

Table 2
Increase in Home-Based Work in India (15 years +)
 (1999-2000 and 2004-05)

Location of Work

1999-2000

2004-05

1999-2000

2004-05

 

Male

Female

No fixed place

13.8

8.3

11.2

3.2

Own dwelling

11.1

12.3

35.5

51.3

Own enterprise

17.7

18.5

8.4

10.7

Employer's Dwell

3.1

3.0

7.5

6.7

Employer's Enterprise

35.9

35.0

26.3

18.9

Street

2.9

7.7

2.1

2.9

Construction sites

9.0

11.0

5.1

4.0

Others

6.4

4.2

3.8

2.4

Total

100.0

100.0

100.0

100.0

Source: GOI High Level Committee on Status of Muslim Community in India 2006, cited in Jhabvala, Unni and Sinha 2007: 9. [Note: table is based on total population, not solely the Muslim Community.]

Gender

Wherever they are found and regardless of the industry, the vast majority of home-based workers are women. The compilation of data from 14 countries cited earlier found that that the share of women in home-based work was over 75 per cent in seven of the countries, over 50 per cent in another one country, and over 30 per cent in the remaining six countries. In the three countries that only counted homeworkers, the share of women was about 80 per cent. A national sample survey in India, specially designed to better enumerate the informal economy, found a high incidence of home-based work overall as well as marked urban-rural and male-female differences in the incidence of home-based work; see Box 1.

Box 1
Working at Home in India

In India in 1999-2000, the National Sample Survey Organization canvassed a labour force survey that was designed to capture informal enterprises and workers and included a question on the “place of work.” The results show that nearly one quarter of all non-agricultural workers are home-based. Within this overall picture, there are marked urban-rural and male-female differences. About 18 per cent of such activities are home-based in rural areas, while only 6 per cent of these activities are home-based in urban areas. Well over half of the female non-agricultural workforce (57%) works at home, while less than one fifth of the male non-agricultural workforce (18%) works at home.
 
A sample survey of the workforce of Ahmedabad city in Western India brings out very clearly the gender differences in the location of work. The findings from that survey show the following distribution of all male and female workers – both formal and informal – across different work sites:

  • 52 per cent of all women, compared to 8 per cent of all men, work at home
  • 18 per cent of all women, compared to 1 per cent of all men, work in others’ homes
  •  5 per cent of all women, compared to 23 per cent of all men, work on the streets
  •  3 per cent of all women, compared to 5 per cent of all men, work at construction sites
  • 22 per cent of all women, compared to 58 per cent of all men, work at factories, offices, or workshops

This study found that women operate nearly 70 per cent of the informal manufacturing activities, nearly 30 per cent of the informal service activities, and just under 15 per cent of the informal trading activities and that the majority of all economic activities managed or operated by women are home-based. Virtually no women run small manufacturing units outside their homes and nearly three quarters of women traders operate from their homes (rather than on the streets).

Source: Jeemol Unni, 2000. Urban Informal Sector: Size and Income Generation Processes in Gujarat. Parts I and II. Delhi: National Council of Applied Economic Research (April). Report Nos. 2 and 3.

Home-based work is particularly significant in Asia, especially among women workers.

  • In Bangladesh, 71 per cent of all women workers, compared to 20 per cent of all male workers, are home-based.
  • In Pakistan, 65 per cent of all women workers, compared to 4 per cent of all male workers, are home-based.
  • In India, 51 per cent of all women workers, compared to 11 per cent of all male workers, are home-based.
  • In India, 90 per cent of bidi (leaf cigarettes) rollers, most of whom are home-based, are women.
  • In Ahmedabad City, India in the late 1990s, there were an estimated 34,957 home-based garment workers, of which 78 per cent were women.
  • In Thailand, a recent study of homeworkers found that some 440,251 workers in 294,290 households live off incomes from homeworking, and that 76.7 per cent of the homeworkers in these households were female (Social Protection in Asia and HomeNet Thailand 2009). Other estimates in Thailand (based on export values and production capacity) suggest that there may be up to 2 million home-based workers (Ibid).

In Latin America, the overall incidence of home-based workers in not high. But there, too, the share of women among home-based workers is very high. In Argentina, it is estimated that 85 per cent of home-based workers in the clothing and footwear industries are women. In Chile in 2000, women represented 90 and 98 per cent, respectively, of all homeworkers in manufacturing and trade. (For a discussion on shifts in homework in Chile, see Box 2.)

Box 2
Shifts in Homework in Chile

The Government of Chile has added special modules to measure homework to its national labour force survey: once in 1997 in both rural and urban areas, and again in 2000 in urban areas only. These survey findings show shifts in the composition of urban homework in the context of a prevailing economic crisis and growing unemployment (8% in 1997, 11.5% in 2000). There were shifts in homework in the urban areas over this period, including: drop in share of homeworkers in total workforce; drop in share of women among homeworkers; and, most significantly, rise in share of men among homeworkers (from 20 to 27%).

There are several possible explanations for the increased share of men in homework, including: the informalization of formal jobs, the flexibility of home-based work, and the emergence of new, higher status, forms of home-based work – involving information technology and the use of computers – that might attract men to home-based work.

Between the two survey rounds, the share of services/commerce in total homework rose from 45 to 56 per cent and the share of services/commerce in male homework rose from 13 to 71 per cent. These findings are consistent with the latter explanation: namely, that higher status forms of home-based work in information-intensive services might have attracted men to home-based work.

In 2000, among all urban homeworkers in Chile, women were over-represented in manufacturing and retail trade (90 and 98%, respectively) while men were over-represented in professional and technical jobs (82 and 66%, respectively).

 

Sources: Helia Henriquez, Verónica Riquelme, Thelma Gálvez and Teresita Selamé, et al. “Home Work in Chile: Past and Present Results of a National Survey.” 2001. SEED Working Paper No. 8. Geneva, International Labour Office. Also: Helia Henriquez and Veronica Riquelme, El Trabajo a Domicilio en el 2000, unpublished report.

Developed Countries: Working at home is also the reality of work for many people in developed countries. In the mid-1990s, home-based workers – here defined as persons who work more than half of their working hours at (or from) their home – represented between 4 to 11 per cent of the total workforce in 8 out of twelve European countries surveyed: Belgium, Denmark, France, Germany, Ireland, Italy, Luxembourg, and Netherlands. In the remaining four countries, the share of home-based workers in the total workforce was as follows: Greece (1%), Portugal (4%), Spain (1%), and the U.K. (3%). For the 12 European countries taken as a whole, the share of home-based workers represented between 4 and 5 per cent of the total workforce (Charmes 2002). In the United States, home-based work grew between 1980 and 1990, after falling significantly between 1960 and 1980. Factors in this growth include advances in information and communication technology and the need to balance work and family by the growing numbers of two-career families. The 1991 national survey found that 1 per cent of all non-farm workers worked entirely at home. Two thirds of these workers were women. In contrast to on-site workers, home-based workers were more likely to be self-employed, to work non-standard hours, and to live in rural areas. Analysis showed that certain population groups – the disabled; women, especially those with young children; and those living in rural areas with long commutes to on-site jobs – had greater representation among home-based workers, presumably because they have limited mobility or need flexible work hours.

The associated flexibility, however, comes at a cost. The average hourly wages of home-based workers of either sex were below those of on-site workers, even when one controls for employment status, hours worked, or urban/rural residence (Edwards and Field-Hendrey 1996). However, comparing earnings is complex because there are work-related costs specific to on-site workers (travel, costs of family care, etc.) and also to home-based workers (overhead for workplace, utilities and equipment).

Challenges to Measuring Home-Based Work

Despite their numbers, and despite the growing interest in their situation, there are few good estimates of home-based workers in general and fewer still of homeworkers in particular. This is due, in part, to problems of enumerating work carried out in the home, especially by women. This is also due to the fact that the “place of work” variable, used to identify persons working at or near their home, is not included in many labour force and population surveys and, even when it is, the results have often not been tabulated in official statistical analyses (International Labour Organization 2002). In addition, to obtain the information needed to understand the nature and scope of the problems they face, home-based workers need to be classified according to appropriate employment status categories and by industry or sector.

There are several specific problems related to measuring homeworkers in particular. An important problem is the difficulty of determining whether a home-based worker works under a contract or agreement for a specific firm; and, if so, whether she/he is self-employed or a homeworker. This is because homeworkers occupy a grey intermediate space between the fully independent self-employed and fully dependent paid employees: see Box 3. Homeworkers typically have to absorb many production costs and associated risks. Most homeworkers are also not directly supervised by those who contract work to them, although they are subject to delivery deadlines and to quality control of the products or services they deliver. For these reasons, they should be considered semi-dependent, not dependent, wage workers. To identify clearly which home-based workers are homeworkers, labour force surveys and population censuses need to include sufficient and appropriate questions regarding their contractual situation.

Box 3
Self-Employed, Homeworkers, and Employees

 Current national and international statistical standards used to measure and classify “status of employment” do not have enough categories to capture the range of employment arrangements in today’s world. This is because all workers are thought to be either fully independent (self-employed) workers on the one hand (such as employers and own account workers) or fully dependent workers on the other (i.e. as paid employees). However, many work situations do not fit neatly into these two basic categories. Rather they fall in a grey intermediate zone between being fully independent and being fully dependent. Consider the intermediate status of homeworkers as illustrated in the table below:

Characteristics

Self-Employed

Homeworkers

 

Employees

Contract

 

sales contract

employment contract

employment contract

Remuneration

from sale of goods/services

for work (typically piece rate)

for work (time or piece rate)

Contract with

self

employer/intermediary

employer

Means of Production

 provided by self

 provided by self

 provided by employer

Workplace

 provided by self

 provided by self

 provided by employer

Supervision

Autonomous

indirect or no supervision

direct supervision

To be able to identify and enumerate homeworkers, and other workers with intermediate employment status, specific questions to probe the key variables in the left-hand column - notably, nature of contract, form of remuneration, place of work, and degree of supervision - need to be designed. The current national and international standards for classifying workers would need to be re-examined to determine whether existing categories can be sub-divided to accommodate these intermediate employment statuses or whether whole new categories that cut across existing ones would need to be introduced.

Source: Box prepared by Martha Chen for 2002 ILO statistics book.

A second problem is the difficulty in identifying the specific firm for which the homeworker works and determining the characteristics of that firm. The current national and international standards for measuring “status in employment” treat the intermediary – the contractor – who supplies raw materials and receives the finished goods against payment for the work done as the “employer.” However, analytically, it is not clear which firm should be considered as the employer of the homeworker: the intermediary that directly places work orders, the supplier that puts out work to the intermediary, the manufacturer that outsources goods from the supplier, or the retailer that sells the goods? There is a parallel legal problem: namely, which unit in the chain should be held accountable for the rights and benefits of workers down the chain? Many labour lawyers and activists argue that the lead firm that initially put out the work should be considered the equivalent of the employer. In real life, many homeworkers do not know which firm puts out the work or sells the finished goods.  

A related problem is that a category of worker associated with the sub-contracting of work – the intermediary or sub-contractor – does not fit conventional categories of employment status. Sub-contracting by a manufacturing or retail firm often involves one or more intermediaries and sometimes involves a long, complex chain of intermediaries. These intermediaries – or sub-contractors – typically receive work orders and raw materials from firms or other intermediaries. They then put out work to small production units or to homeworkers. Many such intermediaries are themselves home-based: that is, they store raw materials at their home and allocate work orders from their homes. In addition to putting out work to others, some intermediaries operate small production units themselves: thereby, taking on the additional status of self-employed outworker. Unlike the independent employer who hires others to work in his/her enterprise, the intermediary depends on a firm or another intermediary for work orders and raw materials and usually sub-contracts, rather than hires, workers. Like an independent employer, however, the intermediary assumes some economic risk: notably, responsibility for storing raw materials, overseeing the quality of production, and delivering finished goods. For these reasons, intermediaries are better considered as semi-independent workers, rather than fully independent employers. 

Depending on the number of intermediaries in any given sub-contracting chain, the links between the homeworker and the lead firm for which they work are often obscure. In long complex chains of intermediaries, bargaining for higher wages is complicated by the distance between the homeworker and the lead firm and the ambiguity over who is responsible for providing higher wages: see Box 4 on homeworkers in global value chains.

Box 4
Homeworkers in Global Value Chains

In global value chains in which the lead firm is a multinational firm based in an industrialized country and the homeworkers are scattered across one or more countries, the links between the homeworker and the lead firm for which she/he works become obscure. The following case illustrates how complicated things can be in negotiating payment or wages due for completed work.

When a trade union organizer in Canada tried to help one immigrant Chinese garment worker get her back wages, she found that the garment worker did not know whom she worked for as the man who dropped off raw materials and picked up finished garments drove an unmarked van. When the garment worker eventually found a tag with a brand label on it among her raw materials, the trade union activist was able to trace the “label” from a retail firm in Canada to a manufacturing firm in Hong Kong to an intermediary in Canada: in this case, the global value chain began and ended in Canada. When the local intermediary was asked to pay the back wages due to the garment homeworker he replied: “Put me in jail, I cannot pay. The manufacturer in Hong Kong who sub-contracted production to me has not paid me in months.”

Source: Stephanie Tang of UNITE, personal communication.

Contributions of Home-Based Workers
Overall, much of what we know about the contribution of home-based workers is still largely drawn from micro studies, as summarized below.

The contribution of home-based workers to household income varies. A study of some 600 homeworkers in three sectors in India found that these homeworkers contributed, on average, 35 per cent of household incomes in rural areas, and 35.6 per cent in urban areas. The range of contributions to household income was 22–47 per cent in rural areas, and 26–71 per cent in urban areas (Sudarshan et al. 2007). Other sources of income in these households included wage work (54% in rural and 40% in urban households), self-employment outside the home (6% in rural and 10% in urban households), salaried employment, and remittances.

Consider the contributions of home-based bidi workers to household incomes in India. A study in the mid-1980s in Gujarat found women’s contributions from bidi work to average 30 per cent of household income (Sudarshan and Kaur 1999). Another study found that, on average, female bidi workers contribute 31 per cent of household income in urban Madhya Pradesh and 71 per cent of household income in urban Tamil Nadu (Sudarshan et al. 2007). An official survey by the GOI in the early 1990s on the working and living conditions of workers in the bidi industry found that 88 per cent of all the home workers in the sample considered bidi work to be their main source of income. On average, income from bidi work was 65 per cent of household income from all sources (GOI 1995).

A 1999 study estimated the contribution of women home-based workers in a few sectors across South Asia, drawing on available studies and using focus group discussions with groups of workers to supplement and corroborate the literature (Bajaj 1999). While these estimates were rough and not based on a representative sample, they are important in setting a benchmark, identifying perceptions, and providing a base for future work. For example, the study reports:

  • In India, in 1989-90, the total domestic and export sales of the agarbati (incense stick) industry were worth approximately USD 198 million and USD 42 million, respectively; and the industry employed approximately 500,000 workers. Ninety per cent of the labour in the industry was female, of which 80 per cent were homeworkers (Bajaj 1999: 11-13).
  • In Bangladesh in 1990-91, garment exports, the country’s principal export earner and fourth largest employer, generated an output worth around Tk. 27,000 million (or approx USD 380 million1 per annum). Eighty per cent of the garment labour workforce was female: while most worked in factories, some were homeworkers (Bajaj 1999: 19).
  • Pakistan is the single largest manufacturer and exporter of match grade footballs in the world, generating over 80 per cent of total world production. Well over half (58%) of football stitchers are female homeworkers (Bajaj 1999: 25-27).
  • In Nepal, over 100,000 persons are engaged in collecting and processing medicinal plants and other non-timber forest products trade and contribute around 4 per cent of the share of forestry to the national GDP. Forest product collection and processing is done by mainly by women; and most processing is done at home (Bajaj 1999: 32-34).

Driving Forces & Working Conditions

Home-based workers in Mexico making bricks

Causes

Historically, many persons in developing countries, especially women, have done remunerative work from their homes as self-employed or industrial outworkers. Today, home-based work appears to be on the rise. Some combination of the following factors probably accounts for this apparent increase. The first is that global competition increases pressures on firms to cut costs through more flexible work contracts or sub-contracting production. The second is that information technology – particularly computers – allows and encourages: a) many clerical, technical, and professional workers to work from their home rather than at another worksite; and b) manufacturing or retail firms to outsource production not only to other countries but also, within countries, to homes. The third is that an increasing lack of formal employment opportunities – due to the lack of economic growth, to capital-intensive patterns of economic growth, and/or to faster growth in the economically active population than in formal employment – forces many workers to take up self-employed work at their home. 

 

Consequences

Despite the considerable diversity in the terms and conditions of work experienced by different groups of home-based workers, they face a common set of needs and constraints. First, because they work at home, home-based workers tend to remain isolated from other workers and are less likely than other workers to be organized and to be able to bargain with their employers or public officials. Second, as a result, most do not have access to employment-based benefits or protection. Thirdly, home-based work is often associated with low pay, especially among homeworkers engaged in manual work.

Low earnings - Home-based workers, on average, earn very little: particularly homeworkers who are paid by the piece and have to depend on contractors of middlemen for work orders and payments. In India, on average, homeworkers earn 27 rupees per day while workers who work outside the home earn 58 rupees per day (Unni and Rani 2004).

Homeworkers who produce for global value chains receive a marginal percentage of the final profit. In India, for every 100 rupees paid by a customer, gold thread (zardozi) embroiderers earn 15 rupees, home-made cigarette (bidi) rollers each 17 rupees, and incense stick (agarbati) rollers earn only 2.3 rupees (Mehrotra and Biggeri 2007). In the prawn peeling industry in Pakistan, homeworkers earn 2.5 per cent per prawn of what a customer pays in the domestic market (Khan 2007) and 1.1 per cent of what prawns sell for in foreign markets (Mehrotra and Biggeri 2007).

Compounding the difficulty of their very low average wages, homeworkers a) have to pay for many of the non-wage costs of production: notably, the overhead costs of space, utilities, and equipment; b) often face irregular work orders and arbitrary rejection of good produced; and c) often face delayed payments.

Homeworkers typically have to absorb many production costs and associated risks – including, buying or renting and maintaining equipment; providing workspace and paying for utility costs; and buying some inputs – often without help from their employers. Thus their net remuneration may be significantly less than indicated by the piece-rates that they are paid. For instance, most garment homeworkers have to buy and maintain their own sewing machines, replace needles and oil, and pay for the electricity to run their machines and light their workspace.

Depending on the number of intermediaries in any given sub-contracting chain, the links between the homeworker and the lead firm for which they work are often obscure. In long complex chains of intermediaries, bargaining for higher wages is complicated by the distance between the homeworker and the lead firm and the ambiguity over who is responsible for providing higher wages.

Typically, manufacturing and assembly work involve low levels of skills, technology, and pay; routine and standardized tasks; and/or physically demanding effort. Professional work, on the other end, tends to be varied, complex, and creative; relying heavily on information technology; involving choice and discretion; and well paid, if not highly paid (Felstead et al. 2000). The other forms of home-based work fall somewhere in between.

A multi-country study found that home-based work is not ‘part time’ as widely perceived but often involves long working days. The average work day varied from 5.2 hours per day to 9.2 hours per day: the longest reported average work day was 15 hours per day (Mehrotra and Biggeri 2007).

Seasonality affects home-based workers, resulting in wide variations in the hours of work available and wages earned per day. A study of home-based workers in different sectors and locations in three Indian states analyzed the average income earned in peak and lean seasons as a ratio of the state minimum wage and found that average earnings represented 6–46 per cent of the state minimum wage in the lean season and from 18–116 per cent in the peak season (Institute of Social Studies Trust and HomeNet India 2007).

Limited Social ProtectionTypically, home-based workers have little or no legal and social protection, poor working conditions, and minimal or no workers benefits. The diversity of employment and the geographically dispersed nature of the workplace pose real challenges. Employment relations vary considerably, and a major obstacle to introducing contributory social insurance schemes is the difficulty in identifying the employer. Because a large proportion of home-based workers are women, they also have child-oriented needs. Social security matters because workers may improve their incomes in the short-term only to lose their assets and earning power when faced with a health crisis or other disaster.

Poor Technology, Low Productivity – Low productivity also arises because of the low levels of technology used by home-based workers. Their remuneration is irregular and so it is difficult to save money to invest in new machinery or in training. For example, garment making for export markets requires a range of sophisticated cutting and sewing machines. Most small units in the informal sector operate with simple sewing machines capable of doing mainly one or at most two kinds of stitches. This reduces the productivity and also limits the nature of markets to which the worker can cater.

Lack of Capital – Many of the production and service activities in home-based work yield low incomes. Poor home-based workers venturing into self-employment and entrepreneurship need enough financial resources in combination with other inputs such as technical and marketing assistance in order to sustain their livelihoods.

Home as Workplace – Many home-based workers work in poor and cramped conditions, with bad lighting and seating. The need most often articulated by home-based workers is the lack of adequate housing. This is a dual disability because their house is also the workplace, and as such a productive asset. Inadequate housing has a deleterious effect on work ability, in addition to being very unhealthy for the family. Another issue is health, particularly occupational health and safety. Many home-based workers are overworked, and exposed to dangerous chemicals, poor working conditions and unhealthy postures. Home-based workers also bear overhead costs such as electricity. Poor infrastructure and living conditions (water and sanitation, waste disposal) eat into their earning time – as they do for all slum dwellers.

Constraints and Risks

Invisibility – The invisibility of home-based workers manifests itself in several ways. No policy for home workers exists. When the work place is at home, most labour laws cannot offer protection – they are designed for a labour market where the employer-employee relationship is clear and for a workplace that is not a private home. Home-based workers tend to remain isolated from other workers and, therefore, have less voice vis-à-vis employers or public authorities than other workers. The lack of a known and common employer has also made mobilization of these groups of workers very difficult since there was no common “enemy” against whom they could be organized. Invisibility and lack of recognition (with no formal contracts or identity cards) gives rise to other insecurities such as access to credit, raw material, infrastructure facilities, etc.

Low Levels of Education and Skills – Under-investment in human capital, which is compounded over generations, is a major insecurity faced by female workers in general and home-based female workers in general, leading to a basic lack of marketable skills. The low levels of skill with which they operate also leads to low earnings. Illiteracy and low levels of education (and related low earnings) are more severe problems for women. The bias against girls’ education and higher dropout rate from schools among girl children handicaps a woman severely when she tries to enter the labour market.

Vulnerability to Economic Downturns – Home-based workers, like others in the informal economy, can be adversely affected by economic trends, especially down turns or crises. In mid 2009, the partners in the Inclusive Cities project conducted focus group interviews with informal workers in 10 developing countries. The research found that many home-based workers who produced for global value chains experienced a sharp decrease in their work orders, and those who worked on their own or for local markets reported increased competition that forced price reductions. The findings of this study are presented in a report entitled “No Cushion to Fall Back On: The Global Economic Crisis and Informal Workers.”

A second round of research was undertaken in 2010 and the same interviewees were revisited. The findings of the second round are presented in a report entitled Coping with Crises: Lingering Recession, Rising Inflation, and the Informal Workforce. For more information on this topic and personal stories, see the Informal Economy/Links with Economic Crisis page.

Lack of Voice – Home-based women workers work in isolation. In some instances, both the women themselves and their work are often hidden within long production chains. Many are so busy surviving that finding the time to devote to an organization is hard. They are also weighed down by the double burden of income generating work and unpaid care work.

The two categories of home-based workers, self-employed and homeworkers, reflects differences that have policy implications. The problems and constraints faced by self-employed home-based workers and homeworkers are quite different, although both typically lack bargaining power and have to provide their own social protection.

Homeworkers are often forced by circumstances to work for low wages without secure contracts or fringe benefits and to cover some production costs (in particular, equipment, space, utility costs). Most self-employed home-based workers, except high-end professionals, face limited access to or competitiveness in relevant markets. To improve their situation homeworkers need to strengthen their capacity to bargain for regular work orders, higher piece rates, and overdue back pay (a common problem faced by homeworkers worldwide); while the home-based self-employed need better access to financial markets and enhanced capacity to compete in product markets. In effect, homeworkers often face problems of exploitation while the self-employed often face problems of exclusion. The strategies to address problems of exploitation in labour markets – such as collective bargaining for higher wages – are different than the strategies to address problems of exclusion in capital and product markets, such as providing access to financial, marketing, and business services.

Policies & Programmes

Home-based Garment Worker

What Home-Based Workers Need and Want

To increase their visibility, home-based workers need:

  • to institutionalize the systematic collection of data on home-based workers and their contribution to national economies
  • to evolve a universally accepted definition of home-based workers
  • to ensure the participation and voice of home-based workers in the formulation of macro-and micro-economic policies

To increase their earnings, home-based workers need:

  • legal status and recognition as workers
  • adoption and implementation of national minimum wages for home-based workers paid by piece-rate
  • access to bigger and inclusive markets
  • inclusion under social protection policies and schemes
  • policy visibility that emphasizes the positive contributions that home-based workers make to the life of cities
  • opportunities to build trade-related capacity through investment in the areas of skills upgrading, technology access and upgrading, design development, market access and product development

To improve their working conditions, home-based workers need:

  • appropriate physical infrastructure, such as housing, water systems, toilets, and waste removal systems
  • stable and sustainable policy environments that secure their legal status as workers
  • the ability to secure loans at reasonable interest rates
  • access to affordable and accessible child care facilities, particularly for very young children
  • capacity building within their organizations
  • leadership training for women
  • urban planning approaches that recognize the home as their work place
  • appropriate occupational health and safety measures
  • social protection, including insurance, health, pension and maternity protection

To increase their voice, home-based workers need:

  • recognition – as workers, and for their organizations as workers’ organizations
  • recognition of home-based workers organizations and alliances as representational bodies at the national, regional and global levels
  • support for collective bargaining and for advocacy campaigns
  • participation in the formulation of macro-and micro-economic policies

Promising Responses

Tripartite Welfare Funds (India) The Bidi and Cigar Welfare Fund Act, and the Bidi and Cigar Cess Act were passed in 1976 and finally implemented in the 1980s. These acts provide social security schemes such as health care, child care and housing for bidi workers. (Similar welfare funds and welfare boards have been implemented for other sectors in India, such as construction workers.)

ILO Convention No. 177 Internationally, an important milestone in the development of policies for home-based workers was the adoption in 1996 of ILO Convention No. 177 (C 177), which mandates that all homeworkers should have basic labour rights – irrespective of the sector in which they work – and guarantees the applicability of core labour standards and other standards to all homeworkers. The Self-Employed Women’s Association (SEWA), an international alliance of home-based workers (called HomeNet), and other labour activists lobbied for this convention. See a list of countries that have ratified C177

C177 on Homework recognizes homeworkers as workers who are entitled to just reward for their labour and sets a standard for their minimum pay and working conditions, including occupational health and safety. Among other recommendations, the Convention calls for improved statistics on homework.

To date, only seven countries have ratified the convention: Albania, Argentina, Bosnia and Herzegovina, Bulgaria, Finland, Ireland and the Netherlands. Once ratified, each country is responsible for developing and reporting on a national plan to implement the Convention. Even without ratifying the convention, countries can and have put in place national policies or specific schemes that reflect some of the provisions of the convention.

In 2013, provincial governments in Pakistan have adopted Home-based Workers Policies. Read more.

For more on this topic, please read the speech given by Hildegard Hagemann, who made a strong case for C177 at the International Labour Conference 98e Session in June 2009. The speech can be found on page 50 of Provisional Record 10.

Kathmandu Declaration In October 2000, at a South Asian regional conference jointly organized by UNIFEM and WIEGO, representatives of home-based worker organizations, government officials, and researchers from five South Asian countries met and formulated the Kathmandu Declaration for the rights of South Asian home-based workers. The Kathmandu Declaration recommended that all countries in South Asia formulate national policies and plans of action for home-based workers in consultation with organizations of home-based workers. The Kathmandu Declaration also recommended that the South Asian Association for Regional Cooperation (SAARC) address the issues of home-based workers in the region and take measures to enable them to deal with the risks and opportunities of globalization.

The Kathmandu Declaration identifies the following major areas, inviting the attention of governments to:

  • formation of National Policy on home based workers by each country
  • minimum protection, which would include right to organized, minimum remuneration, occupational health and safety, statutory social protection, maternity, childcare, skill development and literacy programmes
  • access to market and economic resources including raw materials, marketing infrastructure, technology, credit and information
  • social funds for home-based workers, which would provide insurance against risk of illnesses, death, old age, accidents, loss of livelihood assists and contingencies as locally required
  • incorporation into official labour force and other economic statistics

In 2007, SEWA and UNIFEM co-organized a policy conference on home-based workers of South Asia in New Delhi. Representatives of home-based workers, representatives from the ministries of women’s development, trade, and labour, and technical experts from Bangladesh, India, Nepal, Pakistan, and Sri Lanka participated as well as technical experts from the Philippines, Switzerland, and the UK. The Prime Minister of India, Manmohan Singh, inaugurated the conference, which concluded with the adoption of Regional Strategic Action Plan for Home-based Workers of South Asia. Key features of the Action Plan include:

  • prioritizing the rights and needs of home-based workers in the upcoming South Asian Association for Regional Cooperation (SAARC) Summit, April 2007
  • ratifying the ILO Convention 177
  • formulating national policies for home-based workers
  • collecting statistics on home-based workers and expanding the SAARC Gender Database to include data on home-based workers
  • increasing trade opportunities for home-based workers through exclusive retail platforms and trade promotion initiatives
  • recognizing HomeNet South Asia as a representative body of home-based workers

For more information, see Policy Conference on Home-Based Workers in South Asia.

During the conference, the Prime Minister of India referred to the statistical invisibility of home-based workers in the national statistics. In response, in May 2007, the Ministry of Statistics and Programme Implementation, Government of India decided to set up an Independent Group on Home-based Workers in India, to examine the existing data sources and suggest means to improve data on home-based workers. The terms of reference of the Independent Group was to refine the concepts and definitions of different categories of home-based workers for data collection; to provide a framework for key tabulations and analysis of available data on home-based workers from labour force surveys and economic censuses; and to assess the available data sources, specify data gaps, and recommend pilot data collection measures for filling these gaps in respect of home-based workers. For more information, see Definition of Home-Based Workers. The Secretariat of the Group was placed with UNIFEM, India. The Group submitted their Report in March, 2008. Read the report  at UNIFEM's website or the website of the Ministry of Statistics and Programme Implementation, Government of India.

Through its Development Fund, SAARC is supporting an initiative to strengthen the livelihoods of home-based workers in the South Asian region, implemented by Self- Employed Women’s Association (SEWA) and HomeNet South Asia (HNSA). The project, titled SABAH, seeks to develop national and regional markets for home-based workers and integrate them into regional trade. Launched in November 2008, the project is being implemented in all the SAARC member countries except India: Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan, and Sri Lanka.

Organization & Voice

Home-based Worker making pottery

Despite the challenges in organizing home-based workers, there are a growing number of organizations of home-based workers as well as national and regional networks of such organizations (called HomeNets). Some of these organizations are trade unions, others are cooperatives, and others are associations of various kinds.

For an in-depth look at the importance of organizing casualized and informal women workers, see findings from two HomeNet Thailand studies.

The Self-Employed Women’s Association (SEWA) is a national labour union of woman workers in the informal economy in India. As of 2006, SEWA had a total membership of 1.3 million women in nine states of India; of these, about one fifth are home-based workers. In organizing garment workers, SEWA has focused primarily on negotiating higher piece-rates and fairer working conditions for sub-contract garment workers. This has involved negotiations with the Labour Commissioner to demand minimum wages, identity cards, and social benefits (childcare, health care and school scholarships) for sub-contracted garment workers. Over the years, SEWA has also helped self-employed home-based garment makers to acquire new skills, improved equipment and market information to try to compete in the fast-changing local garment market. This has included loans for improving sewing machines, training at the National Institute of Fashion Technology (NIFT), and installing electricity in the homes of SEWA members (Inclusive Cities n.d.). Read about the impact of SEWA's housing assistance on lives and livelihoods for informal workers.

HomeNet South Asia (HNSA) is a network of 600 organizations representing over 300,000 home-based workers from five countries in South Asia: Bangladesh, India, Nepal, Pakistan and Sri Lanka. The local and national affiliates of HNSA provide skills development and technical support to their members. HNSA helps these organizations gain representative voice at the national, regional and international levels in order to influence legislation, policies and programmes.

The membership-based organization PATAMABA, in the Philippines, has approximately 17,000 members, of whom 9,500 are home-based workers. The group works in 28 cities in 15 provinces and 9 regions. Its urban chapters support home-based workers to develop social enterprises, participate in local government policy debates, develop community housing, pursue training and new production methods and access social services. PATAMABA supported home-based workers to organize for the purpose of accessing the Social Security System (SSS) to allow self-employed home-based workers to access social insurance via an Automatic Debit Account arrangement whereby members can use the facilities of partner banks to make their social insurance contributions.