AccLabPY

24/01/2023

Formalization of employment (through knowledge and awareness of rights to social security)

This activity is framed within the frontier challenge "Employment formalization", since the learning cycle aims to observe the changes that can occur in the perception of informal workers in the construction sector about social security, after an intervention which provided different formats of training on social security and labor rights for these workers. It is expected that this change in the perception of workers will have an impact on their assessment of social security and labor formalization. 

The original learning question of our action learning plan is: how can we increase access to social security and improve the economic and physical security of employment in Paraguay's informal economy, particularly for women and in the recycling, construction, domestic work, and apparel industries?

Ministerio de Trabajo, Empleo y Seguridad Social (MTESS), International Labour Organization (ILO)

Evaluate the impact of different training formats for construction workers on their labor rights: one offering information, and another combining information with a methodology for reflection on their own knowledge and awareness of social security rights.

The experimental hypothesis establishes that the values of labor rights and solidarity can be strengthened, through reflection on the right to social security, helping to denaturalize risks and generating recognition of workers as subjects of rights. The spaces for reflection, combined with the provision of accurate information on social security, its benefits, and institutional regulations, would increase the positive assessment of social security by workers. This hypothesis is fully shown in the causal chain of our blog post on how to build good knowledge of social security and formalization.

Our hypothesis: access to information and reflection spaces improves workers’ assessment of social security. We designed a randomized control trial in order to test our hypothesis. In this experiment: a group of individuals were randomly assigned to three different subgroups: a control group, treatment group 1, and treatment group 2. Each treatment group receives a different treatment, while the control group does not receive any treatment. 281 construction sector workers were convened for this experiment via a socioeconomic questionnaire circulated on social media. There were two criteria for inclusion: (1) having completed a technical training course in construction work, and/or (2) having construction work experience. Unfortunately, the rise in COVID-19 infections limited how many participants we would have in a physical meeting space and affected worker participation. In total, 70 workers attended workshops in the month of December 2020. Of these, 24 were assigned to the control group, 18 to the treatment group 1, and 28 to treatment group 2.

Construction workers from Asunción and the Metropolitan area

In general terms, our experimental hypothesis was verified, with heterogeneous results according to the dimension observed and the treatment group. In general, the two treatments show positive and significant effects on the degree of knowledge on social security of the participants. We create a knowledge index to estimate the effect of the treatment on the knowledge about social security of the participants. This index includes three dimensions: knowledge on economic benefits, knowledge on health benefits and knowledge about institutional regulations of IPS.  The results show a greater effect of treatment 1 (32.1% vs 24%) compared to treatment 2 on the degree of knowledge of the individuals. This highlights the relevance of the informative workshops as a treatment and potential venue to increase the knowledge on social security of the construction workers, taking into account the ease of implementation with respect to the workshops that include the reflection component. In the same way, we propose an index that measure the perception that construction workers have about the social security. For this, we consider three dimensions: economic valuation, health valuation, and right-based valuations.  The results show positive and significant effects in general terms. In this sense, the treatment 1 increments in 21.5% the positive perception of social security of workers, an effect greater than that found as a result of treatment 2 (13.7%). Finally, the reflection spaces do not show significant effects on the valuation of social security of construction worker in any of its four topics: solidarity responsibility, comprehensiveness of the social security system, right to access social security, and equality in access to social security. The results that emerge from this analysis indicate that, in general, the intervention of information (treatment 1) had a significant effect on increasing knowledge and improving the perceptions about the social security of the participants, in relation to the control group that received informative messages through WhatsApp. In other words, the informative workshops carried out by the MTESS and by other institutions have greater potential to improve knowledge and perceptions that digital communication campaigns. In some of the calculated indices, the informative workshop had a greater effect than the reflective one, and vice versa. In general, the difference of the impact between the two types of workshops is not very large, so we conclude that integrating reflective exercises into an informative workshop adds value to this type of offer formative. The results show the importance of the information campaigns as a tool to change both the knowledge and the perception that construction workers have on social security. However, since this intervention does not assess the role of information in increasing formalization, it is necessary to consider other types of obstacles to determine if this strategy is an effective tool to overcome barriers to formalization.

The evidence we generated with the experimental intervention suggests that providing treatment groups with accurate information about social security benefits, policies, and procedures substantially improved their assessment of social security. Informative workshops or seminars seem to be especially effective in improving the assessment of economic and health benefits. The informative seminars carried out by the Ministry of Labor and other institutions represent an effective and efficient strategy to improve the interest of workers in accessing social security. Combined with other interventions designed to generate interest in social insurance of the employers, these seminars have a high potential to increase the number of formalized workers in the construction industry in Paraguay. As we found in the exploration activities of this learning loop, making access to social security effective requires addressing other barriers in combination with the one addressed in this work. These other barriers include the need to better clarify the legal responsibility of contractors and subcontractors, streamline procedures, identify incentives for labor inspection, among others. The experimental approach presented in this work and throughout the learning cycle developed allows us to address each of these barriers from a logic based on evidence and on the meaningful participation of workers.

We face many obstacles throughout the realization of our intervention, related to different types of barriers: 1. COVID-19 pandemic limited the number of participants of the informative and reflection workshops.   2. Adverse weather conditions forced the suspension and rescheduling of the workshops, affecting the number of participants. 3. Cultural beliefs regarding masculinity and gender are strongly embedded in construction workers. Therefore, generating changes in these aspects may require more time and dedication to observe the effects of the interventions on them.

The Inclusive Development Portfolio of our CO also focuses on some activities related to employment formalization and our findings could help to shape and design new projects and activities oriented to reduce the barriers to formalization in some industries such as construction, domestic work, among others.