Skill development in the informal sector in China, Thailand and India – A case study of street food vendors

Abstract

Informal sector dominates the economic activities of the Asian Counties like India, Bangladesh, Nepal, Cambodia, Vietnam and China and so does informal learning. By looking at the percentage of the population occupied in the informal sector, especially street food vending, the present study attempts to unravel the ways in which knowledge and skills acquired in the informal sectors especially street food vending by the individuals. It is field based research. We have collected data for the research from major metropolitans in China, Thailand and India due to the presence of a large number of street food vendors. The interview schedule is prepared based on the informal learning theory. The results of the study revealed that majority of street food vendors in China, Thailand and India acquire much of their knowledge and skills in catering and business management from work experiences. The informal learning from real work experiences instead of formal schooling plays a central role in their skill and knowledge acquisition. The learning happens in different settings like family, community, neighbours and friends. The promotion of non-formal adult learning may strengthen the skill development in the developing and transition countries.

Key words: Informal Sector, Informal learning, Street food vending and skill development

1 Introduction

The significant growth and development in Asian countries has brought about innumerable variations in the macro-economic situations such as urbanisation and changes in the share of different sectors in the economy. These changes increase the economic activities of the informal sector in the developing and transition countries. The rural migrant, semi-skilled, unskilled, and less-educated population join the informal sector in poorer countries like India, Bangladesh, Nepal, Cambodia and Vietnam. In countries like China and Thailand, some workers in formal sector are forced into informal sector due to layoffs (Bhowmik 2005). Considering the percentage of population involved in informal sector, especially street food vending, we have decided to study about this topic in China, Thailand and India with the following research questions.

  • Where do individuals acquire knowledge and skills required in the informal sector?
  • How does informal learning take place in informal settings?
  • What kind of skills do individuals have, and to what level?
  • How do individuals run their businesses?

Before exploring further street food vending, a brief introduction about informal sector and informal learning with special reference to China, Thailand and India is in order.

2 Informal Sector, Informal learning and Street Food Vending

Globalization and open economy in Asian Countries further expanded the informal sector through capital movement across national boundaries. This informalisation of macro economy provides cheap labour and small scale support services by producing goods in piece rate and offers contractual services to multinational and transnational corporations (Rani & Unni 2009). According to International Labour Organization (ILO), Informal Economy has grown to account for 65 per cent of the total non-agricultural employment in Asia (ILO 2002 cited in Debrah 2007). This paper follows the definition of Charmes (1999) with regard to informal sector.

‘Informal Sector is defined as comprising: Informal Self-owned enterprises that may employ family workers and one or more employees on an occasional or continuous basis.’

Charmes, 1999 provides a further statistical definition which distinguishes between the two main components of the segments of the informal sector as: (i) the ‘family enterprise’ (own account informal enterprises) without permanent employees; and (ii) the ‘micro-enterprises’ (informal employers) with permanent employees’. Micro-enterprises are defined as those informal sector units that employ salaried employees (between five and ten) on a continuous basis be they home-based, street-based or established in fixed premises (as cited in Debrah 2007).

Informal Sector is also known as unorganised sector in India (NCEUS 2009) and it is a ‘developing and transition countries’ phenomenon (Huang 2009; Schneider 2006). Our focus in this paper is about skill development in the informal sector, particularly the street food venders. Skill development is defined as:

‘Acquisition of practical competencies, know-how, and attitudes to perform a trade or occupation in the labour market, either through formal public or private schools, institutions or centres, informal, traditional apprenticeships or non-formal semi-structured training.’ (King & Palmer 2010, 136).

Our study is based on the informal learning theories. It is necessary define formal, non-formal and informal learning. The definitions are as follows:

‘Formal learning takes place in education and training institutions, leading to recognized diplomas and qualifications.’ (UNESCO 2012; Pilz et al. 2015)

‘Non-formal learning takes place alongside the mainstream system of education and training and does not typically lead to formalized certificates. Non-formal learning may be provided in the workplace and through the activities of civil society organizations and groups (such as youth organizations, trade unions and political parties). It can also be provided through organizations and services which have been set up to complement formal systems (such as arts, music and sports classes or private tutoring to prepare for examinations).’ (UNESCO 2012)

‘Informal learning is a natural accompaniment to everyday life. Unlike formal and non-formal learning, informal learning is not necessarily the intentional learning, and so even the individuals may not recognise it as a substantial contributor to their knowledge and skills.’ (UNESCO 2012; Pilz et al. 2015)

The respondents of the study are street food vendors. The definition for the street vendor is follow as:

‘A street food vendor is a person who offers goods for sale to the public without having a permanent built-up structure from which to sell. Street vendors may be stationary in the sense that they occupy space on the pavements or other public/private spaces or, they may be mobile in the sense they move from place to place carrying their wares on push carts or in baskets on their heads.’ (Bhowmik 2005)

This paper applies these definitions. Street vendors provide goods including food at lower prices for urban population (Bhowmik 2005).

3 Country selection criteria

 employment is about 65 per cent in Asia in early 2000s (ILO 2002b). There are various kinds of employment opportunities in the informal sector. Among them, street vending, especially street food vending, occupies a significant position and considerable number of people depend on street food vending as their livelihood option in China, Thailand and India. The existing studies (Tinker 1997; Yasmeen 2000; Bhowmik 2005; Wardrop 2006; Chung et al. 2010; Gadi et al. 2013; Etzold 2014; Swider 2015) did not concentrate on skill development, informal learning and street food vending. Rather they were more about the extent of their presence, role of Non-Governmental Organizations (NGOs) and Self Help Groups (SHGs) in street food vendors’ welfare, contribution of street food to address urban food security, policies related to street food vending, Thai habit of public eating, hygienic practices, rights of street food vendors and cultural factors.

Searches revealed a scarcity of literature on informal learning in China. The existing studies focus on different forms of e-learning and distance learning. These studies have predominantly addressed the application of technologies in the informal learning. A few studies have examined the development of competence through informal learning, but mainly in the field of teacher’s development. Very few studies have paid attention to the effect of informal learning in the informal setting (Yang & Yu 2010). The study conducted by Pilz et al. (2015) in two cities of India brought the significance of non-formal learning for skill development among street food vendors.

4 State of Research

Before looking at skill development in street food vending using primary data, a brief review of the literature regarding the informal sector, skill development and informal learning in China, Thailand and India is presented in this section.

In China there are about 277.5 million immigrant workers (nongmingong) in urban areas in 2015 and many of these immigrants are working in informal sectors (NBSPRC 2016). Their work input is 50 per cent more than the formal workers, while their earning is 60 per cent less than them (Huang 2006). Out of the 302 million workers, 182 million urban workers are in informal sector, many of whom are into street vending. Along with immigrants from rural areas, some local urban people also take to street vending due to layoffs with the advent of economic restructuring.

In Thailand, manufacturing sector is not able to absorb the whole migrant population. This resulted in the expansion of informal sector (Arunotai et al. 2007). Financial crisis led to loss of jobs for millions of workers and they too were forced into informal sector as house maids, street food vendors, motorcycle or taxi drivers etc. Among informal employees in street vending, 30-90 per cent are women, even though women’s labour force participation in all sectors is less than men’s (ILO 2002b).

In the past few decades, India has become one of the fastest growing economies along with China and Vietnam (Basu 2008). Besides formal employment, informal sector has grown and the contribution of the informal economy to the overall economy is 60 per cent in India (The World Bank 2008; ILO 2002a). The estimate (Rodrik 1997; Planning Commission 2001; Chen et al. 2002; Dev 2000; Marjit 2003; Chaudhari & Banerjee 2007) of informal work force accounts to 93 per cent of the total work force in India. Only two per cent of the Indian workforce has formal vocational training and 80 per cent of workers have acquired skills informally while on the job (Mehrotra 2014b). As many as 2.5 per cent of the urban population in India chooses street vending as an occupation (Bhowmik 2005).

We illustrate the presence of informal sectors in the selected three countries for this study. According to Charmes (1999) and Bhowmik (2005), we broadly categorise the activities of the informal sector into two groups: informal self-owned enterprises and casual workers. Majority of the self-owned enterprises in informal sector are into street vending (Bhowmik 2005). Home based workers and street vendors comprise the largest sub-groups in the informal workforce. Between the two, visibility of street vendors is more prominent. They comprise 10-25 per cent of the non-agricultural workforce in developing countries (ILO 2002b). The workforce distribution in the informal sector differs from country to country. As far as China, Thailand and India are concerned, considerable number of people are into street food vending.

This paper discusses skill development through informal learning based on the definitions given above and the theoretical aspects of informal learning. There are existing theoretical aspects of informal learning and skill formation in the informal sector. Most of the time, informal learning is not accepted as learning as it is invisible and the resultant knowledge is tacit attributable to the learning capability of the individual rather than the learning environment. When one provides learning and learners gain knowledge and skill from that environment, the existing learning discourse stresses on gaining knowledge which must be factual and measured. But in informal learning, learners certainly find it difficult to describe what a complex work environment is and how much they learn from that environment (Eraut 2004). There are three important characteristics in informal learning. They are implicit, unintended, opportunistic and unstructured. Implicit learning is defined by Reber 1993 as ‘the acquisition of knowledge independently of conscious attempts to learn and in the absence of explicit knowledge about what was learned’. We have drawn the inference on the significance of studying informal sector and the process of acquiring skill by understanding the existing theories of informal learning.

5 Method

Based on the literature review above, empirical studies were carried out in the corresponding countries. In order to compare the facts and results from each country it is necessary to have a comparable structure for empirical investigation. To obtain an in-depth understanding of the situation of the street food venders and their skill acquisition, face-to-face interview was preferred as an effective method. Meanwhile, for the sake of certain flexibility and allowing for country-specific conditions, not all the interview questions could be pre-determined. Therefore, we conducted semi-structured, face-to-face interviews with street food venders in each country.

Case study method has been used for similar investigations in the past (Denzin & Lincoln 2005). The data for the present study comes from field research and is collected from major metropolitans of the chosen country because of the availability of large number of street food vendors and the samples of the respondents have been chosen through purposive sampling method; in this case the cities are Shanghai in China, Bangkok in Thailand and New Delhi in India. The present study can be called as instrumental case study extended to several cases or as multiple or several case studies (Denzin & Lincoln 2005), because researchers try to get insights of the skill transfer and acquisition of knowledge. The researchers purposely choose several cases in three countries to bring some types of understanding on skill transfer and bring knowledge to existing informal learning (Denzin & Lincoln 2005). The researchers in this study try to draw the activities and functioning of the street food vendors in physical setting, as well as socio-economic, political and legal contexts. Based on the research questions, structured interview schedule with open and close-ended questions were prepared. The in-depth interview is conducted among deliberately chosen samples. Based on the existing informal learning theory, the questionnaire for interview is developed in line with the existing socio-economic condition of the informal sector especially street food vending. The informal learning theory discusses gaining of tacit knowledge, contribution of environment, contribution of individuals and difficulty in measuring skill levels (Barber 2004; Prakash & Kumar 2016). Considering existing theories and difficulty in measuring, we have chosen the case study method. Each interview was carried out by two researchers in all three countries. One researcher puts forth the questions and the other researcher records the answers. The answers revealed by the respondents are verified through observation.

The current study by researchers not only explored the individuals from different angles but also collected quantitative data to investigate the socio-economic condition of the respondents. The recorded interview was developed as case and quantitative details are tabulated. Altogether the sample size is 44 with the breakup details of 10 in China, 19 in India and 15 in Thailand. The case study of the data is presented in three sections. The first section analyses quantitative data, the second, cases, and the final section analyses vocational training, informal learning and skill development in street food vending.

6 Results and Analysis

Table 1 below demonstrates some of the main characteristics of street food vendors in the selected countries.

Table 1: Education and Socio-economic Background of the respondents

  India* China** Thailand***
Age range of interviewees 18-61 years 22-55 years 26-63 years
Gender Male 100 per cent Male 75 per cent Male 6.7 per cent
Female 25 per cent Female 93.3 per cent
Literacy rate (per cent) 89 per cent 100 per cent 100 per cent
Primary education 26 per cent 10 per cent 27 per cent
Upper primary education 11 per cent 50 per cent -
Secondary education 21 per cent 30 per cent 7 per cent
Higher secondary education 21 per cent - 67 per cent
Self-employment rate (business owners) 63 per cent 90 per cent 100 per cent
Business experience      
Less than 10 years 32 per cent 56 per cent 53 per cent
11-20 years 42 per cent 33 per cent 27 per cent
More than 20 years 26 per cent 11 per cent 20 per cent
Average family income per month 480 Euro - 1024 Euro
Average working business capital per day 24 Euro - 81.75 Euro
Average sales volume per day 40 Euro - 56 Euro

n*= 19 n**= 10  n***=15

The socioeconomic background shows that the respondents start their entry into street food vending at the age of 18 in India and China. They get into vending at 22 in Thailand. The literacy rate among respondents from India is 94 per cent and the overall literacy rate in India as per 2011 census is 74 per cent (Census of India 2011). Existing studies point out that illiterate and semiliterate with low skilled or unskilled workers joins the informal sector. Among the informal sector, the percentage of the population joining food industry/street food vending has increased. Similarly, the sale and consumption of street food are increasing in the recent years. In many developing countries like India and Thailand, street food vending is a common phenomenon of urban lifestyle due to unemployment and limited work opportunities (Gadi et al. 2013). Unlike India, the literacy rate and minimum educational qualification to enter into street food vending are higher in China and Thailand. The previous study found that a higher percentage of females join street food vending in Thailand due to various reasons (ILO 2004; Chung et al. 2010). This reflects in our studies too. Women in Thailand become income earners of their families. Men preferred to stay at home and remain unemployed. Men considered informal employment such as vending and selling food is apt only for women (ILO 2004). 72.9 per cent of the female and 72.3 per cent of the male were part of the informal employment excluding agriculture employment in Indonesia (Laborsta 2012). The percentage of women entering into street food vending is low in India and our study is not able to locate women street food vendors in New Delhi. More than street food vending, women prefer other types of street vending like selling vegetables and materials. Likewise, the female labour force participation in India is 29 per cent in 2009-2010 and it fell from 37 per cent in 2004-2005 according to ILO’s Global Employment Trend 2013 report. Women play a supporting role in China in street food vending. 35.7 per cent of female and 30.1 per cent of the male were part of the informal employment excluding agriculture employment in China (Laborsta 2012). With regard to educational level, 20 per cent of the respondents from Thailand attained highest degree, 7 per cent of the respondents obtained a certificate specializing in finance and food safety in addition to a higher degree.

All the respondents are self-employed in Thailand. This percentage is only 63 in India and 90 in China. More than 50 per cent (China 56 per cent and Thailand 53 per cent) have been running their street food vending for less than a decade. In India, 32 per cent of the respondents have been running the street food vending business for less than 10 years. 20 per cent of the respondents in Thailand, 26 per cent in India and 10 per cent in China have been doing their business for a long period spanning over 20 years.

By looking at the respondent’s working capital and volume of sales, considerable percentage of profit is earned by the respondents.

Learning - Skill Acquisition

The results of the interviews suggest that the street food vendors in all three countries acquire their skills in a similar pattern to a certain degree. The majority of the interviewees learn a considerable part of their skills through learning on the job in an informal way.

When asked about the necessity of schooling, a Chinese interviewee mentioned the importance of learning from experiences instead of theory: ‘With that book knowledge alone you won’t have a clue how things work here in reality’, and that ‘theories are just for those big companies’.

The present study found that street food vendors in India acquire skill and knowledge through close relatives. There is no formal training available to gain knowledge. Apart from close relatives, they learn skills by observing from previous employers. Only one respondent attended preservation technique training organised by the government. The number of women street food vendors is high in Thailand. The process of socialization defines roles and responsibilities for men and women. Cooking and household chores are defined as women’s roles. By preparing food for others at home, they learn cooking (Moser 1993; Kabeer 1999). With this skill, family members motivate them to start their own business. Food served in street food shops are normal, regular, consumable food. To prepare food with unique taste, homemade spices are used. The same socialization process shows a variation in gender roles in India and China. In India men are considered as breadwinners. When cooking comes as an economic opportunity, men occupy the prime position in vending and women assist their counterparts; whereas in China women may also take the lead role in cooking or management. None of the respondents underwent vocational training skills in India.

Unlike in India, the majority of the street food vendors acquire their catering skills by working as apprentices in restaurants or food chains in China. Some of the respondents are not trained in food industry, but they have learnt management and financial skills to run the business in VET institute or from experiences. Study shows that VET is in line with industry needs and local industries are involved in training. But in India only two per cent of the workforce, between age 15 and 29 gets formal skill training and eight per cent gets informal training (Mehrotra 2014b). School dropouts directly join informal sector without acquiring required skills.

Like India, street food vendors in Thailand acquire cooking skills by observing family members or peers. Women dominate in street food vending in Thailand. This is proved in the study conducted by ILO in 2004. They try to improve the taste of the dishes by getting suggestions from the customers. So the vendor-customer interaction is unique in Thailand. A woman street food vendor remarked:

‘My family is behind me and my aim is to expand the business with the required license. Formal training is required only for those who do not know about the basics of cooking and being a woman, I can teach better.’

The results of our study show that vendors in Thailand and India prepare food freshly and they serve. Vendors in Thailand practice hygienic techniques to prepare and serve food. The officials from the Department of Public Health, Government of Thailand visit vending site regularly to ensure hygiene. They conduct training programme on regular basis on health and hygiene. According to a vendor:

‘There are authorities to check quality of foods in the past. Currently, vendors are part of the government project by the Ministry of Public Health which ensures quality and make the vendors to wear proper clothes like apron, mask and hat while cooking.’

Vendors are also advised to consult doctors regularly for their personal health. They get counselled not to cook or sell during their illness.

Vendors in India cook fresh food every day. They don’t freeze remaining food to use next day. Street food vendors do practice hygiene. But, it depends upon individual vendors. According to one vendor: ‘My father taught me to be hygienic to attract customers.’ Another vendor opines that ‘perfect hygiene is impossible to maintain as it is a street shop’, he says. But they take care of some basic issues like keeping the food stall clean, keeping the food covered, keeping the hands and nails clean and asking the employees to keep short hair. In China, hygienic practices depend upon vendor’s individual choice.

General Business Knowledge: Pricing, book keeping and m  arketing

The majority of the interviewees in all three countries have not attended any formal education or training in financial management and business. Their understanding and knowledge on how to run a business are obtained from their work experiences. For them, the theoretical knowledge of business is something far away from reality, whereas the real-life experiences are valuable sources of practical know-how.

A Chinese woman selling Chinese meat bread thinks that theoretical knowledge learned from school can be helpful, however, hands-on training teaches even more:

‘When you start the business you will learn many things you did not know before, for example, we realised after a very short time that we didn’t need to rent the canteen room, because most customers either get takeaway food on their way to work or home, or they call for delivery food from companies or home.’

Even a young couple who studied business in their college regard practical know-how gained from actual working as more important: ‘Theoretical knowledge learned at school is not very useful in reality; we have to figure out things from what is really happening on the street’. However, the young couple applied some business strategies that are quite unique when compared to other street food venders. When they just started their business less than a year ago, they had printed brochures introducing their main courses and addresses; they use smartphone applications and other internet tools to attract customers other than those from the neighbourhood. They have an ambition of making franchise stores in the future.

The researchers enquired about general issues like pricing, book-keeping and marketing. As far as India is concerned, there are no considerable changes in the price of the items every year. But a few respondents said that they moderately increase the price by 0.027 Euro or 0.040 Euro once in six months. Majority of the respondents in Indian cities fix price of the products based on the price of the competitor’s product without calculating the cost of the ingredients, labour charge and rent of the place (if rented). Street food vendors do not have the habit of keeping accounts (book-keeping). However, there are some shrewd respondents in India who fix the price of the food items based on the amount spent on raw material, capital and economic condition of the customers. They also feel that good communication skills are required to attract customers.

Like Indian respondents, Chinese have used very little marketing/sales strategies. They fix the cost of food items based on the raw material and rent. For one shop, the rent for a 20m2 shop is 270 Euro and the cost of the ingredients and labour is on average 400 Euro a month. After calculating both and estimating the daily expense of running a business to be about 28 Euro, they fix the price of the food items.

Street food vendors in Thailand are reluctant to increase the price of food items as they are afraid of losing customers. There are no specific marketing techniques followed by the street food vendors. Still, they identify a few important techniques to be followed to roll out a successful business. They have improved the taste of dishes over the years by innovative cooking methods. Besides tasty food, hospitality, promotion, free drinking water, nominal price and vendor’s personality are the vital factors for their success in street food vending. Yet, they find difficulties in forecasting the business turnover. At times, the returns decrease due to increase in the price of ingredients. Let’s say the cost of the raw material is approximately 52 Euro-77 Euro and the turnover is about 105 Euro. The profit would be approximately 13-15 Euro. Overhead expenses increase with the higher cost of gas and water. The vendors also realise the need of interaction with customers to recognize the quality of the food served. With the valuable feedbacks from the customers they will try out means to enhance the taste. Some of them fix sales target and it may go up to 52 Euro per day.

Special Knowledge on production and buying raw materials

One of the most indispensable phases of street food vending is procuring raw material at a reasonable price and preparing food in a unique way. Indian Cities are well-known for street food vending. India is a vast country with each region having specific varieties and tastes. The study conducted by Gadi et al. in 2013 found that the youth population (in the age group of 18-24 years) prefer street food to restaurants. Street food vending in India is considered as family business and Indian vendors develop unique taste using exclusive spices. Like the vendors in India, those from China and Thailand also procure raw material from whole-sale market at a reasonable price so as to keep the price as low as possible. We have drawn a case study from each country and the same have been given below.

A. India

Shushil Parshar, 52, owns a street shop at Connaught Place, Delhi. He is a graduate. His shop that was started 20ago is famous for ‘rajma chawal’. The idea to make rajma chawal, the main dish of their shop was his father’s, he says, as the people of Delhi are fond of it.

They are quite popular in the area as their food is similar to that of home-made ones. Hygiene is on their priority list as they are aware that nobody will visit the shop if they compromise on it. The food is kept covered. They cover their head and wear gloves while serving food. Parshar feels that formal training is important, but he says, satisfying the taste buds of customers is far more important than training. They cook fresh food every day. No preservation technique is adopted since it is a small street shop. Generally, there is shortage of food during week days as the demand increases during lunch time.

The whole family is into the business. There are around five men in the shop. None of them have completed school. They don’t have any formal training in catering. But their culinary skills are tested before they are taken in. They are permanent employees and thus are provided with regular health check-ups.

Earlier, they had used a cart wheel to sell the food. Later they managed to get a place with persistent negotiation with the Delhi Development Authority officials. They are open on all days of the week from 10 am to 8 pm. For handling accounts, they maintain a day book, which ensures transparency. The price of the food depends on the cost of raw materials and labour charges. If the cost of the raw materials and labour increases, the cost of food also increases. Still they try to make it reasonable.

B. China

One of the interviewees is the owner of a fried dumpling store, male, aged around 50 years, who has completed primary school education. He started the food business in 1989, after he failed in his previous business. He basically learned cooking on the job. He simply tried making egg cakes and fried dumpling by attempting different ingredients and procedures. In the beginning, the cakes and dumplings were not very tasty, but he gradually learned the methods to make it taste better.

He started the business with a couple of relatives. Now there are about nine employees. The younger chefs working with him have been trained through formal courses. He starts working from 2 am, first making soya bean milk, and then preparing materials for dumplings. They start selling the food at around 6 am, and normally they close the store in the late afternoon. The man never received any training in finance and management. He basically determines the price of everything according to the price of the raw materials and the rent of the store.

C. Thailand

Mrs. Patchara Khumwong (Pi Mam) is a 47-year-old female and her husband has a Bachelor’s degree in early childhood education and animal science. They sell chicken rice and other dishes in front of Benjasap Village, by Ransit- Nakornnayok Road, Phathumthani province. Income per day is 137.5 Euro and profit per day is 25-37.5 Euro excluding costs of water, electricity and other incidental expenses.

Her husband lost his job at the age of 40. With the little savings he made from his job, they opened a restaurant as a supplier of food cooked elsewhere. But the business turned out to be a fiasco. Mrs. Petchara was a home maker and has never worked outside home since she graduated. After losing their business, they borrowed about 1025 Euro to resume food business because her husband likes to cook. They used to cook and sell four menus but changed to khao Man kai (Boiled Chicken with oiled Rice in Chinese style) because they need to travel far to the market to get raw materials. Her husband consults his cousins to improve the taste of the dishes. As she had been keen to improve the family’s economic status, she had undergone training at Thanyaburi Municipal about street food sanitation. She has registered herself as a street food vendor. She also got trained in the laws regarding street food vending. The training cost for a day was 2.5 to 5 Euro. She got support from the government for training.

Her husband buys fresh meat and all the ingredients at 5 am. In the afternoon Mrs. Petchara prepares food at the cart and serves the customers. The two food carts measuring 1.5 x 2.00 square meters are adjacent to each other. They sell three menus. However, she preserves pork leg stew in the freezer to enhance its taste. She records and calculates expenditures and profits. The costs are 87.5 Euro per day and electricity charges come up to 15 Euro per month. She utilises water from her home supply. On the whole, she gains profit mostly.

The municipal inspects food sanitation regularly. She wears apron to protect herself from dirt and dust. When the couple falls sick, they suspend the business temporarily and take care of each other. They had got a shark loan with 20 per cent interest as they had gone bankrupt from the previous business. She hopes to get 37.5 Euro instead of 12.5 Euro per day, which covers family expenses and loan payments. She has been selling dishes at 0.875-1 Euro each for years to her regular customers.

Mostly people apprehend that street foods are cheaper, full of dust and dirt. But, she keeps her food hygienic. Her customers are from diversified financial background. She is in this business not out of pleasure. She would rather be occupied than being unemployed. According to her, street food vending is a battling career as it demands hard work and life long struggle.

7 Special Findings on Formal Vocational Training

Concerning formal vocational training, the interviewees from the three countries also vary considerably, as the table below illustrates.

Table 2: Participation in formal vocational training

Per cent of ‘‘yes’’ responses India China Thailand
Have you received any formal training? 11 per cent 20 per cent 30 per cent
Have you taken any post-training test or examination? 5 per cent - 100 per cent
Have you received any certificates on completion of training? 0 per cent 20 per cent 0 per cent
Are you aware of any skills building programme/vocational education required for Street vending business? 5 per cent 20 per cent 100 per cent
Have you undergone any health examinations? 5 per cent - per cent 33 per cent

The percentage of respondents who received formal training is high in Thailand (30 per cent) in contrast to India and China. Along with formal training, all trained respondents (100 per cent) have taken post-training examination in Thailand and none of the respondents in China have taken this examination. Only five per cent of the respondents in India have taken post-training examination. All the respondents are aware of skill training/vocational education programme in Thailand and this percentage was very low in India. As many as 33 per cent of the respondents have undergone training on health and hygiene in Thailand and this is not so in the case of China and India.

In India, a majority of population in the informal/unorganised sector undergoes non-formal vocational training. This is reflected in our study where street food vendors in India and Thailand learn cooking from their family members. They preserve their family’s traditional recipes to make their dishes unique and competitive. Vendors gain knowledge about health, management and financial aspects from an established VET school in Thailand. Government also regularly provides training to street food vendors in Thailand. Street food vendors from Thailand have acquired relatively more formal training compared to their counterparts from China and India. Among the three countries, street food vendors from Thailand follow certain marketing techniques and they are aware of financial calculations. They employ smart techniques to attract the same customers regularly. Image for the street food is high in Thailand which is highlighted in our study.

8 Conclusion

Education and Training plays a crucial role in strengthening human capital to bring high productivity and quality performance (Schultz 1961; Becker 1964; Lucas 1988; Romer 1990). The availability of training provisions and skill levels of workers are significant to face global competition (Finegold & Soskice 1988; Porter 1990; Keep & Mayhew 1999; Ashton & Felstead 2001). But developing countries provide little attention to create new productive force (King 2009). This paper has reflected this issue.

Apart from producing skilled youth for the economy, addressing unemployment is a big challenge for developing countries like India, China and Thailand. China has good example where per capita coverage of education in the workforce was just 4.3 years of schooling prior to 1985 and this increased to 8.1 years in 2001 which in turn increased the capacities of china’s workforce. In the era of global competitiveness, countries realized the significance of investing in education and training to strengthen human capital. The investment in human capital in turn brings high productivity and quality performance (Marshall 1920; Schultz 1961; Becker 1964; Lucas 1988; Romer 1990).

The economic success of Japan, Korea, Singapore and Taiwan from the 1970s until mid-1990s is due to the well-trained, educated, hardworking, and conscious labour force. The policy of the above said governments (Asian Tigers) on post-secondary education, technical skill training and technically sophisticated disciplines has created technically-skilled human capital needed for rapid economic development (The World Bank 1993).

As the results from empirical investigations and analysing the same with informal learning theories and macro-economic situation, the present study clearly demonstrates that the majority of street food vendors in China, Thailand and India acquire much of their knowledge in catering and business management from work experiences. The informal learning from real work experiences instead of formal schooling plays a central role in their skill and knowledge acquisition.

In the informal sector, learning moves from situation-specific environment to different working and living environment. Learning process becomes socialization process and it happens through different groups like family, community, neighbours and friends. Informal learning provides lots of flexibility and freedom to the learners. It gives great scope for the learners to learn from others than socialization process (Eraut 2004). This is reflected in our study.

The present study and other studies have pointed out that in Thailand, along with skills required for financial services, secured worksites, access to new technologies, local governments’ (Municipality) facilitation and business services supports informal sector, especially street food vending (Liimatainen 2002; Riley & Steel 2000). NGOs also play a significant role in Thailand. They provide services to micro, small, medium size enterprises along with training. Vendors from all three countries are reluctant to increase the price of the food items due to the fear of losing customers. Among three countries, highest percentage (26 per cent) of street food vendors in India is running business for more than 20 years.

Lack of required number of training staff is another issue in China (Ministry of Statistics of China 2002). Lack of absorption capacity by the SOEs, lack of assured jobs, perceived poor quality of graduates, out-of-data curriculum are some of the problems ITIs face in India and China. There are various regulations for enterprise training in China (Cooke 2005; Mehrotra 2014b). Vocational Education Law in China provides ample opportunity for the provincial and local governments to integrate vocational training with better planning and resource allocation. While some provincial/local governments implement the Vocational Education Law well, some others take little effort for better execution. Overall lack of monitoring mechanism retards the proper implementation of law (Cooke 2001; Cooke 2002a).

This can be emulated in India and China. As mentioned in this study NSFVA in India and NGOs in Thailand also assist informal sector employers’ association in skill training by reducing cost of the training needs assessment, establish competency standards, develop curricula, and certify skills obtained in traditional apprenticeship (Adams 2008). Our study brought out that the respondents have entered into street food vending at the age of 18 in India and China, none of the respondents in India has undergone VET. In this situation, NGOs can consider providing a non-formal Vocational Education and Training at their working site to make young informal sector employees as skilled workers.

As this study points out, research on skill development in informal settings is of major interest not only for researchers, but also for politicians and all actors in the labour market. The comparison between different countries can additionally extend the value of research by cross-country learning and adaptation of best practice.

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Citation

Gengaiah, U., Li, J., Hanvatananukul, S., Prontadavit, N. & Pilz, M. (2018). Skill development in the informal sector in China, Thailand and India – A case study of street food vendors. In: TVET@Asia, issue 10, 1-21. Online: http://www.tvet-online.asia/issue10/gengaiah_etal_tvet10.pdf (retrieved 31.01.2018).

Author(s)

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Uma Gengaiah
Indira Gandhi National Open University
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Jun Li
Institute of Vocational and Technical Education, Tongji University
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Sirilak Hanvatananukul
Rajamangala University of Technology Thanyaburi
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Nonthalee Prontadavit
Rajamangala University of Technology Thanyaburi
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Matthias Pilz
University of Cologne