Informal Sector And Its Contribution To The Livelihood Of The Urban Poor In Hossana Town, Southern Ethiopia: The Case Of Street Vending

Abstract

Informal sector plays a significant role in income generation, reducing unemployment thereby contributing to the livelihood of urban poor. This study is aimed at assessing the contribution of street vending to the livelihood of urban poor. The study adopted mixed research method with Triangulation strategy. Combinations of purposive and systematic random-walk sampling techniques were applied to draw sample street vendors. Data were gathered from a sample of 196 street vendors in Hossana town. The study result revealed that street vending is an opportunity to both rural and urban poor for making a living in urban centers. Since, majority of the street vendors were migrants and the driving factors for the expansion of street vending were both push and pull factors such as unemployment, decline in agricultural production, rural-urban migration and expected employment opportunities in urban areas. The study findings imply that there are numerous challenges of street vending such as lack of working premises, lack of capital/access to credit institutions, eviction by urban authorities and decline in government revenue are the key challenges of street vending. Given the immense contribution that the sector has, therefore government and concerned bodies need to consider the sector as one of the strategies to combat urban unemployment and poverty in the long run. Thus, street vendors should be encouraged to join the formal sector by organizing, managing suitable market sites, giving finance, lessening bureaucracy for license. Moreover, inclusive urban planning is needed to encourage the participation of urban poor including street vendors to sustain their livelihood.