Which economic sector is often characterized by poverty and poor working conditions?

The informal economy is often characterized by poverty and poor working conditions due to its unregulated nature. Individuals working in this sector typically do not have formal employment contracts and lack access to social security, health benefits, and labor rights that are typically provided in more regulated environments. This lack of regulation means that wages can be significantly lower, job security is minimal, and working conditions are frequently unsafe or exploitative.

In contrast, the formal economy includes jobs that are officially recognized and regulated by the government, offering protections and standards that can lead to better working conditions and benefits. The public sector is involved in providing services and governance, which usually operate under more stable economic conditions. The private sector also encompasses many formally recognized businesses, which tend to have more resources to ensure better employee welfare as compared to the informal sector. Thus, the informal economy stands out as the one mostly associated with poverty and poor working conditions.