placestats

Inequality-adjusted HDI vs. Informal employment

Holds up after adjusting for income

Across 135 countries, Inequality-adjusted HDI and Informal employment rise and fall together at r = -0.90 (on a scale from −1 to +1, where 0 means no link). Comparing only countries with similar income (GDP per person) shrinks it to -0.50 (q = 0.046, allowing for the many pairs tested). Much of the first figure is that both measures rise with national income, but a moderate negative link remains. Caution: direction is not consistent across regions.

Comparing countries across the middle half of informal employment, 15.4% to 84.2% of employment, inequality-adjusted hdi is worse by 0.351 points at the top of that range than the bottom. Comparing only countries with similar national income, the gap is 0.144 points.

Link before adjusting (r)-0.902p = 1.7e-50 · 135 countries
After adjusting for national income-0.495p = 1.2e-9 · likely range [-0.61, -0.36]
p, allowing for regions0.000standard error 0.044 · 6 regions
Check for luck (q)0.046across 12,497 pairs

How to read these.r runs from −1 (one goes up as the other goes down) to +1 (they rise together), and 0 means no link. Adjusting for national income means comparing countries with the same GDP per person, so differences in wealth can’t explain the link. Income is used in percentage terms, since an extra $1,000 means more to a poor country than to a rich one. p is how likely a link this strong would be if there were really none. Below 0.05 means it is unlikely to be chance. Very small values are written in short form: 1.1e-32 means a decimal point followed by 31 zeros and then 11, so very close to zero. The likely range is where the true figure probably lies, and a range that crosses zero means the link could easily be chance. Countries in the same region tend to resemble each other, so the third figure allows for that, which gives a fairer p. The standard error is the typical size of the error in r. Finally, testing this many pairs means some will look strong by luck alone. A q below 0.05 means this link is unlikely to be one of those.

Inequality-adjusted HDI · index, 0 to 1link with income +0.94 · proxy
Informal employment · % of employmentlink with income -0.88 · proxy

Both of these rise and fall closely with national income, so a strong link between them before adjusting was close to certain. Read the adjusted figure, not the first one.

“Link with income” is how closely each measure tracks GDP per person across countries, from −1 to +1.

Every country as a dot

Inequality-adjusted HDI · index, 0 to 1 →Informal employment · % of employment →0.2290.9230.63%98.5%Afghanistan: 0.321 index, 0 to 1, 86.1% of employmentAngola: 0.36 index, 0 to 1, 95.3% of employmentArgentina: 0.761 index, 0 to 1, 51.6% of employmentArmenia: 0.743 index, 0 to 1, 76.1% of employmentAustria: 0.861 index, 0 to 1, 1.32% of employmentBurundi: 0.286 index, 0 to 1, 98% of employmentBelgium: 0.891 index, 0 to 1, 1.37% of employmentBenin: 0.316 index, 0 to 1, 96.3% of employmentBurkina Faso: 0.273 index, 0 to 1, 93.8% of employmentBangladesh: 0.482 index, 0 to 1, 84% of employmentBulgaria: 0.748 index, 0 to 1, 1.2% of employmentBahamas, The: 0.67 index, 0 to 1, 18.3% of employmentBosnia and Herzegovina: 0.689 index, 0 to 1, 16.6% of employmentBolivia: 0.578 index, 0 to 1, 83.9% of employmentBrazil: 0.594 index, 0 to 1, 35.6% of employmentBarbados: 0.62 index, 0 to 1, 61.8% of employmentBrunei Darussalam: 0.756 index, 0 to 1, 21.4% of employmentBotswana: 0.509 index, 0 to 1, 75.6% of employmentSwitzerland: 0.894 index, 0 to 1, 1.48% of employmentChile: 0.723 index, 0 to 1, 26.4% of employmentCote d'Ivoire: 0.35 index, 0 to 1, 92.1% of employmentCameroon: 0.361 index, 0 to 1, 87.1% of employmentCongo, Dem. Rep.: 0.341 index, 0 to 1, 96.3% of employmentColombia: 0.593 index, 0 to 1, 56% of employmentComoros: 0.356 index, 0 to 1, 88.8% of employmentCabo Verde: 0.478 index, 0 to 1, 60.6% of employmentCosta Rica: 0.678 index, 0 to 1, 36.1% of employmentCyprus: 0.841 index, 0 to 1, 1.68% of employmentCzechia: 0.867 index, 0 to 1, 2.26% of employmentGermany: 0.89 index, 0 to 1, 2.49% of employmentDjibouti: 0.341 index, 0 to 1, 47.6% of employmentDenmark: 0.909 index, 0 to 1, 2.82% of employmentDominican Republic: 0.634 index, 0 to 1, 54.7% of employmentEcuador: 0.64 index, 0 to 1, 68.5% of employmentEgypt, Arab Rep.: 0.582 index, 0 to 1, 68.6% of employmentSpain: 0.819 index, 0 to 1, 2.2% of employmentEstonia: 0.841 index, 0 to 1, 2.4% of employmentEthiopia: 0.326 index, 0 to 1, 77.7% of employmentFinland: 0.891 index, 0 to 1, 2.19% of employmentFiji: 0.626 index, 0 to 1, 45.7% of employmentFrance: 0.836 index, 0 to 1, 3.15% of employmentUnited Kingdom: 0.869 index, 0 to 1, 6.51% of employmentGeorgia: 0.754 index, 0 to 1, 51.5% of employmentGhana: 0.399 index, 0 to 1, 78% of employmentGambia, The: 0.329 index, 0 to 1, 83.9% of employmentGuinea-Bissau: 0.331 index, 0 to 1, 94.8% of employmentGreece: 0.825 index, 0 to 1, 3.58% of employmentGuatemala: 0.479 index, 0 to 1, 75.9% of employmentHonduras: 0.496 index, 0 to 1, 82.6% of employmentCroatia: 0.828 index, 0 to 1, 1.17% of employmentHaiti: 0.337 index, 0 to 1, 91.6% of employmentHungary: 0.819 index, 0 to 1, 1.31% of employmentIndonesia: 0.608 index, 0 to 1, 81% of employmentIndia: 0.475 index, 0 to 1, 88.1% of employmentIreland: 0.886 index, 0 to 1, 1.9% of employmentIraq: 0.534 index, 0 to 1, 67.6% of employmentIceland: 0.923 index, 0 to 1, 1.97% of employmentItaly: 0.817 index, 0 to 1, 3.42% of employmentJamaica: 0.59 index, 0 to 1, 54.6% of employmentJordan: 0.637 index, 0 to 1, 55.1% of employmentKenya: 0.456 index, 0 to 1, 86.5% of employmentKyrgyz Republic: 0.649 index, 0 to 1, 57.5% of employmentCambodia: 0.444 index, 0 to 1, 89.4% of employmentKiribati: 0.535 index, 0 to 1, 61.5% of employmentKorea, Rep.: 0.857 index, 0 to 1, 29.1% of employmentLao PDR: 0.462 index, 0 to 1, 90.5% of employmentLiberia: 0.326 index, 0 to 1, 89.3% of employmentSt. Lucia: 0.523 index, 0 to 1, 28.3% of employmentSri Lanka: 0.63 index, 0 to 1, 67.6% of employmentLesotho: 0.357 index, 0 to 1, 89.1% of employmentLithuania: 0.812 index, 0 to 1, 3.2% of employmentLuxembourg: 0.838 index, 0 to 1, 1.93% of employmentLatvia: 0.812 index, 0 to 1, 2.17% of employmentMoldova: 0.719 index, 0 to 1, 52.2% of employmentMadagascar: 0.319 index, 0 to 1, 96.1% of employmentMaldives: 0.602 index, 0 to 1, 47.3% of employmentMexico: 0.646 index, 0 to 1, 56.4% of employmentMarshall Islands: 0.626 index, 0 to 1, 32.6% of employmentNorth Macedonia: 0.723 index, 0 to 1, 11.1% of employmentMali: 0.281 index, 0 to 1, 94.4% of employmentMalta: 0.843 index, 0 to 1, 0.63% of employmentMyanmar: 0.477 index, 0 to 1, 80.7% of employmentMongolia: 0.647 index, 0 to 1, 27.1% of employmentMozambique: 0.297 index, 0 to 1, 95.5% of employmentMauritania: 0.374 index, 0 to 1, 89.3% of employmentMauritius: 0.669 index, 0 to 1, 23.4% of employmentMalawi: 0.365 index, 0 to 1, 92.7% of employmentNamibia: 0.438 index, 0 to 1, 55.6% of employmentNiger: 0.265 index, 0 to 1, 98.5% of employmentNigeria: 0.379 index, 0 to 1, 93.1% of employmentNicaragua: 0.535 index, 0 to 1, 81.8% of employmentNetherlands: 0.892 index, 0 to 1, 2.63% of employmentNorway: 0.909 index, 0 to 1, 1.43% of employmentNepal: 0.437 index, 0 to 1, 81.5% of employmentNaoero: 0.599 index, 0 to 1, 47.9% of employmentPakistan: 0.364 index, 0 to 1, 88.7% of employmentPanama: 0.664 index, 0 to 1, 58.7% of employmentPeru: 0.633 index, 0 to 1, 70.5% of employmentPalau: 0.616 index, 0 to 1, 7.27% of employmentPoland: 0.817 index, 0 to 1, 8.62% of employmentPortugal: 0.795 index, 0 to 1, 4.73% of employmentParaguay: 0.599 index, 0 to 1, 64.5% of employmentWest Bank and Gaza: 0.538 index, 0 to 1, 48.8% of employmentRomania: 0.758 index, 0 to 1, 2.21% of employmentRussian Federation: 0.758 index, 0 to 1, 19.3% of employmentRwanda: 0.399 index, 0 to 1, 84.3% of employmentSudan: 0.328 index, 0 to 1, 94.2% of employmentSenegal: 0.34 index, 0 to 1, 89.2% of employmentSierra Leone: 0.281 index, 0 to 1, 93.1% of employmentEl Salvador: 0.555 index, 0 to 1, 64% of employmentSomalia, Fed. Rep.: 0.229 index, 0 to 1, 81.9% of employmentSerbia: 0.772 index, 0 to 1, 17.8% of employmentSlovak Republic: 0.833 index, 0 to 1, 4.37% of employmentSlovenia: 0.885 index, 0 to 1, 0.7% of employmentSweden: 0.886 index, 0 to 1, 2.83% of employmentEswatini: 0.431 index, 0 to 1, 53.3% of employmentSeychelles: 0.755 index, 0 to 1, 14.2% of employmentChad: 0.252 index, 0 to 1, 96.9% of employmentTogo: 0.363 index, 0 to 1, 92.3% of employmentThailand: 0.677 index, 0 to 1, 63.2% of employmentTajikistan: 0.594 index, 0 to 1, 63.6% of employmentTimor-Leste: 0.451 index, 0 to 1, 80.6% of employmentTonga: 0.682 index, 0 to 1, 59.2% of employmentTunisia: 0.595 index, 0 to 1, 36.9% of employmentTurkiye: 0.708 index, 0 to 1, 27.7% of employmentTuvalu: 0.578 index, 0 to 1, 20.1% of employmentTanzania: 0.391 index, 0 to 1, 90.8% of employmentUganda: 0.4 index, 0 to 1, 94.5% of employmentUruguay: 0.747 index, 0 to 1, 28.5% of employmentViet Nam: 0.641 index, 0 to 1, 67% of employmentVanuatu: 0.521 index, 0 to 1, 72.4% of employmentSamoa: 0.609 index, 0 to 1, 51.5% of employmentSouth Africa: 0.476 index, 0 to 1, 34.8% of employmentZambia: 0.361 index, 0 to 1, 82.7% of employmentZimbabwe: 0.406 index, 0 to 1, 85% of employmentARGARMBDIDJIDNKIDNISLNERNORPLWTCDZAF

best-fit line line after adjusting

Four ways to measure the link

MethodrpCountries
Standard (Pearson), not adjusted-0.9021.7e-50135
By rank (Spearman), not adjusted-0.9061.6e-51135
Standard (Pearson), adjusted for national income-0.4951.2e-9135
By rank (Spearman), adjusted for national income-0.4504.9e-8135

The rank version uses only each country’s place in line, from lowest to highest, so a few extreme countries count for less. The adjusted and unadjusted versions use the same 135 countries: those that report both measures and GDP per person. So the gap between them comes from the adjustment, not from a change in which countries are counted. Drop in the size of r after adjusting: +0.407 (a minus sign means it grew).

How solid is it?

Leaving out one country at a time, r ranges from -0.526 (without DJI) to -0.477 (without AGO). The bar above shows that range on a scale from −1 to +1, with the solid line at the full result. The single country that moves r most: DJI (-0.031).

Fragile: this link may not hold up.
  • direction is not consistent across regions

Within each region

Countries are not separate, unrelated cases, and neighbors share a lot. A link that holds inside each region is far more believable than one that shows up only when comparing regions.

nr
East Asia & Pacific19-0.47
Europe & Central Asia40-0.14
Latin America & Caribbean22+0.15
Sub-Saharan Africa40-0.59

By income third

If the link shows up only in the richest third of countries, it is a feature of rich countries, not a general pattern.

nr
Poorest third45-0.59
Middle third45-0.30
Richest third45-0.51

By largest religious group

Countries grouped by a label they share, such as main religion, rather than by a number. Groups of fewer than twelve countries are not shown. These groups differ in income, region and history all at once. So a gap between them is a place to start asking questions, not an answer.

nr
Christians87-0.47
Muslims30-0.54

By last european coloniser

Countries grouped by a label they share, such as main religion, rather than by a number. Groups of fewer than twelve countries are not shown. These groups differ in income, region and history all at once. So a gap between them is a place to start asking questions, not an answer.

nr
France18-0.19
Never a European colony12+0.05
Spain16-0.33
United Kingdom40-0.49

Without outliers (countries far outside the middle half of countries on either measure, by more than one and a half times the width of that middle half): r = -0.495 after dropping 0 countries.

Two series, one country

Both measures over the years for one country you pick. The two charts are stacked so they share only the years along the bottom.

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Over time, within countries

Everything above compares countries with each other at one moment. This section compares each country only with itself over 14years. So a link here can’t come from anything about a country that stays the same, such as its history, geography, institutions or culture.

Within countries over time, there is no link that is clearly more than chance (r = -0.159, comparing each country only with itself over the years, and each year only with the same year elsewhere). Whatever the cross-country picture shows, countries whose inequality-adjusted hdi moved did not tend to see their informal employment move with it.

Across countries (adjusted)-0.495for comparison
Within countries-0.363each country vs itself
…and vs the same year elsewhere-0.159q = 0.171 · 80 countries
Year-on-year changes+0.019q = 0.881
Read with care.
  • Almost all of this indicator's variation is between countries, not within them, so the within-country estimate rests on a small part of the data.
  • Much of the within-country association disappears once shared global year effects are removed, which points to a common worldwide trend rather than a country-level relationship.

887 country-years (one country in one year), 80 countries, 2010–2023, about 11 years each on average. Share of the variation that happens within countries over time: 1% for Inequality-adjusted HDI, 1% for Informal employment. The margins of error allow for each country appearing many times, and for each year’s value being close to the year before.

Year-to-year changes are a cautious test, not a final answer. Looking only at changes from one year to the next removes each country’s own trends. But it also makes measurement mistakes louder, which pulls the results toward zero. A near-zero result here is weak evidence of no link, not proof.

With one measure years behind the other

0.20−0.2-100+10years Informal employment trails Inequality-adjusted HDI →lag -10: r = -0.107 (n = 376)lag -9: r = -0.105 (n = 453)lag -8: r = -0.056 (n = 509)lag -7: r = -0.069 (n = 567)lag -6: r = -0.038 (n = 629)lag -5: r = -0.047 (n = 689)lag -4: r = -0.108 (n = 746)lag -3: r = -0.156 (n = 799)lag -2: r = -0.146 (n = 833)lag -1: r = -0.191 (n = 853)lag +0: r = -0.159 (n = 887)lag +1: r = -0.128 (n = 886)lag +2: r = -0.109 (n = 832)lag +3: r = -0.129 (n = 762)lag +4: r = -0.135 (n = 682)lag +5: r = -0.138 (n = 609)lag +6: r = -0.108 (n = 537)lag +7: r = -0.084 (n = 454)lag +8: r = -0.068 (n = 386)lag +9: r = -0.028 (n = 310)lag +10: r = -0.120 (n = 234)

Same year (lag 0): -0.159. A peak away from zero does not show which comes first. These series change slowly — this year’s value is close to last year’s. That makes the curve smooth and nearly symmetric, whatever produced the data. Even a sharp peak at one lag (a gap of some years) would not prove that one measure changes the other.

The data


index, 0 to 1
% of employment		Years
Iceland ISL0.9231.97%2023, 2020
Norway NOR0.9091.43%2023, 2024
Denmark DNK0.9092.82%2023, 2019
Switzerland CHE0.8941.48%2023, 2024
Netherlands NLD0.8922.63%2023, 2024
Finland FIN0.8912.19%2023, 2024
Belgium BEL0.8911.37%2023, 2024
Germany DEU0.892.49%2023, 2022
Sweden SWE0.8862.83%2023, 2024
Ireland IRL0.8861.9%2023, 2024
Slovenia SVN0.8850.7%2023, 2024
United Kingdom GBR0.8696.51%2023, 2018
Czechia CZE0.8672.26%2023, 2024
Austria AUT0.8611.32%2023, 2024
Korea, Rep. KOR0.85729.1%2023, 2019

United Nations Development Programme, Human Development Report 2025
United Nations Global SDG Indicators Database; series compiled by the International Labour Organization (8.3.1) and the UN Office on Drugs and Crime (16.3.2)

Sources

Inequality-adjusted HDI

Inequality-adjusted Human Development Index

United Nations Development Programme, Human Development Report Office · via Our World in Data · CC BY 3.0 IGO · updated annual · comparable from 2010 only

The HDI marked down for how unequally each of its three parts is spread within the country. The gap between this and the HDI is what inequality costs, and that is the number worth reading. The level itself is the HDI again, with its parts flagged the same way.

Informal employment

Share of employment that is informal

International Labour Organization · via Our World in Data · CC BY 3.0 IGO · updated annual

Workers with no contract, no social protection or no registered employer, as the ILO (the UN's labour agency) makes them comparable across national labour force surveys. The World Bank's copy of this series was retired, so it comes from the UN's database for the Sustainable Development Goals.

How this was computed

Data used: most recent value in 2010-2025; values come from 2012–2025. To adjust for income, each measure is first predicted from GDP per person (in percentage terms, on a log scale) with a straight-line fit. Only what is left over is then compared. This is called a partial correlation. The line is drawn the standard way (ordinary least squares), which picks the line that comes closest to all the countries at once. The error margins allow for countries in the same region resembling each other, using 6 World Bank regions. The q-value corrects for testing all 12,497 pairs at once, using the Benjamini–Hochberg method. Underlying data last updated DYB 2024. How the country data works · explore Inequality-adjusted HDI and Informal employment

This page shows that two measures go together. It does not show that Inequality-adjusted HDI changes Informal employment, or the reverse. These figures also describe countries, not individual people. See the ecological fallacy.

More links with Inequality-adjusted HDI or Informal employment