Page 78 - Azerbaijan State University of Economics

THE JOURNAL OF ECONOMIC SCIENCES: THEORY AND PRACTICE, V.81, # 2, 2024, pp. 60-83

Study Results
− Like other developing countries' economies, the Algerian economy suffers
from high levels of informality, primarily driven by informal labor.

− High rates of self-employment are a prominent feature of the Algerian
economy. This phenomenon is more a healthy sign than a problem. However,
what concerns researchers and economists in this field is the high percentage
of this type of employment operating outside the formal framework, where
most self-employed individuals in Algeria, including freelancers, work
beyond the legal boundaries.

− There is a strong positive correlation between the percentage of the informal
economy in Algeria and the rate of self-employment. This relationship exists
in most developing countries, aligning with the study by (Cardarelli, C., E.,
Gupta, & S, 2022), which found a strong bilateral correlation between self-
employment, informal labor, those not enrolled in the retirement system, and
Schneider's index (the size of production hidden from regulatory authorities).
− The freelance labor market in Algeria has expanded significantly in recent
years due to the rise of the knowledge economy and the spread of digitization
in the country. This is evident in the freelance job offers available through
various national, Arab, and international specialized platforms, which align
closely with global labor market trends affected by structural changes and
technological disruptions (Sulintanga, 2024).

− The self-employed contractor law in Algeria provides a suitable framework
and is an important step toward attracting Algerian freelancers and self-
employed workers, especially since most of their activities fall under the
eligible activities for benefiting from this law.

Study Recommendations
To ensure that the self-employed contractor law is indeed the optimal solution for
organizing freelance work, Algeria's informal economy and self-employment, the
study proposes the following points:

− Include the activities of liberal professionals and artisans within the eligible
activities for benefiting from the law, as they represent a large group working
outside the formal framework due to the tax burden imposed on them by the
legal and fiscal system they belong to.

− Amend the basic laws of public employment to allow workers to engage in
formal activities after working hours or during holidays, thus eliminating the
prohibition of dual employment.

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