Quantitative data on the prevalence of undeclared work [1] in Greece are not available. However, it is generally accepted that the informal economy is large, accounting for between 24% and 30% of gross domestic product (GDP).[1] www.eurofound.europa.eu/ef/observatories/eurwork/industrial-relations-dictionary/undeclared-work
A field study carried out in 2007 in 10 sectors of the Greek economy explores the prevalence and nature of undeclared work in the country. The study is based on questionnaire results, interviews and data from the Social Insurance Institute. Given the lack of systematic data collection on this issue, the study gives an interesting insight into the extent of undeclared work in the Greek economy.
Background to study
Quantitative data on the prevalence of undeclared work in Greece are not available. However, it is generally accepted that the informal economy is large, accounting for between 24% and 30% of gross domestic product (GDP).
Recently, the results of a field study on undeclared work, which was commissioned by the Ministry of Employment and Social Protection (Υπουργείο Απασχόλησης και Κοινωνικής Προστασίας) and published in August 2007, were presented to the public (Mihail and Gotzamanis, 2007). The study sought to assess the occurrence of undeclared work in 10 sectors of the Greek economy. While the study is not a quantitative survey, given the absence of systematic data collection on the subject, it provides an interesting insight into the problem.
Study methodology
As part of the field study, 75 questionnaires were issued to accountants in small enterprises and economic advisors in larger companies. The statistical analysis of the collected data led to the calculation of average estimates. In addition, 25 personal interviews lasting almost two hours each were held with entrepreneurs, as well as interviews with seven directors of the Labour Inspectorate (Σώμα Επιθεώρησης Εργασίας, SEPE) and two directors of the Social Insurance Institute (Ίδρυμα Κοινωνικών Ασφαλίσεων, IKA). Finally, quantitative information from inspections of the Special Insurance Inspection Service (Ειδική Υπηρεσία Ελέγχου Ασφάλισης, EYPEA) of IKA was used.
Main results of study
The main study results for the 10 sectors surveyed are summarised in the table below.
| Field of economic activity | Extent of undeclared work |
|---|---|
| Restaurants | Average estimated share (based on data of IKA inspections): 38% Labour inspectors’ estimate: between 20% and 40%, with higher percentages given by inspectors who operate in tourist areas, where seasonal undertakings are prevalent Entrepreneurs operating in tourist regions of the sector: up to 70% |
| Café bars | Average estimated share of undeclared work (based on labour inspectors’ estimates): 50% Data from IKA inspections: about 40% Entrepreneurs’ estimate: up to 90% |
| Nightclubs | Average estimated share: 55% Labour inspectors’ estimates: 70% Data of IKA inspections: 25% |
| Hotels | Average estimated share: 25% Labour inspectors’ estimates: 20% (mainly in tourist areas) Data of IKA inspections: 9% Entrepreneurs’ estimate: 20% Estimate of trade union for the tourism industry: 64% |
| Courier services | Average estimated share: 30% Labour inspectors’ estimates: between 10% and 30%, while there are certain references to undeclared work reaching 60% in the province Entrepreneurs’ estimate: up to 30% |
| Home delivery services | Average estimated share: 60% Labour inspectors’ estimate: 80% Entrepreneurs’ estimate: up to 90% or even higher Nonetheless, regarding the major enterprises operating either through branches or under franchise agreements, labour inspectors refer to a share of undeclared work ranging between 0% and 10%, which is probably used to deal with extraordinary needs |
| Security services | Average estimated share: 25% Labour inspectors’ estimate: percentage varies depending on the area of responsibility, with proportions reaching as high as 75% Trade union estimate: 35% of workers in the industry are undeclared and the loss of profits incurred by IKA amounts to €100 million a year |
| Cleaning services | Average estimated share: 43% Labour inspectors’ estimate: 20% Entrepreneurs’ estimate: up to 95% in micro enterprises which mainly operate as family businesses and employ a limited number of personnel. Regarding small-sized enterprises that employ 15–25 persons, undeclared work is estimated to range between 20% and 60% on a case-by-case basis. In terms of the major enterprises in the sector, undeclared work is reported in up to 60% of cases – in some instances, the number of worker hours that are declared and insured differ markedly from the actual number of hours worked |
| Construction | Average estimated share: 38% No data available from IKA inspections Labour inspectors’ estimates: between 20% and 40%, with higher proportions registered in island areas Undeclared work seems to be primarily recorded in the repair and preservation of building works |
| Manufacturing | Average estimated share: 26% in craftwork and 14% in industry Labour inspectors’ estimates: up to 20% for small industries Data of IKA inspections: 18% in small industries, 10% in larger-scale craftwork companies and 6% in industries It emerges from the interviews held with persons involved in the sector that some activities are more prone to non-declaration of work, such as loading/unloading and transport, which are assigned to more or less controlled third parties. Thus, companies in the manufacturing sector avoid the direct risk of using undeclared work, which is instead assumed by other enterprises that are typically autonomous |
Note: Undeclared work is taken to mean any work that is lawful but not declared to the competent authorities and that is not insured at all or as it should be.
Source: Mihail and Gotzamanis, 2007
Reference and further information
Mihail, D. and Gotzamanis, E., ‘Presentation of existing situation in the sector of undeclared work and preparation of a study and specialisation of actions intended for restricting undeclared work in the context of the new Operational Programme ‘Human Resources 2007–2013’, Thessaloniki, 30 August 2007.
The European Foundation for the Improvement of Living and Working Conditions (Eurofound) has published a range of case studies on [tackling undeclared work](/search/node/areas OR labourmarket OR tackling OR search.php?oldIndex) in the European Union.
Sofia Lampousaki, Labour Institute of Greek General Confederation of Labour (INE/GSEE)
Eurofound recommends citing this publication in the following way.
Eurofound (2010), Spotlight on undeclared work in 10 sectors, article.
