Market Update: Informal sector dominates 2.64m businesses powering economy     – Full Analysis

By Juliet ETEFE

The economy is underpinned by a vast network of formal and informal enterprises, with the latest Integrated Business Establishment Survey I (IBES I) identifying a total of 2.64 million businesses operating nationwide.

The survey, conducted by Ghana Statistical Service (GSS) in 2024, provides a comprehensive picture of the country’s business landscape by incorporating fixed-structure establishments alongside open-space and mobile business segments which have historically been underrepresented in official statistics.

Findings show that 1.87 million establishments, representing 70.6 percent of all businesses, operate from fixed structures. Open-space businesses account for 693,748 enterprises (26.0%) while 82,920 businesses (3.1%) operate on a mobile basis.

These data highlight the informal sector’s significant role – particularly open-space and mobile enterprises – in supporting livelihoods, employment and access to goods and services across the country.

Mobile business refers to businesses that do not operate in a fixed location or structure, but operates while in motion – either by head porterage, hawking or with the aid of motorised vehicles. These businesses bring goods and services directly to households, commuters and communities.

Open-space businesses, on the other hand, operate at fixed locations in open environments including roadsides, pavements, market peripheries and residential areas. These businesses provide goods and services and generate income across urban and peri-urban communities.

Mobile businesses

Mobile businesses, though relatively small in number, remain a critical component of urban economic activity. The sector is heavily concentrated in key commercial regions, with Greater Accra accounting for 30.1 percent and Ashanti 20.3 percent of all mobile operators.

At the district level, Accra Metropolitan recorded 5,321 operators and Kumasi Metropolitan recorded 3,792 operators.

Women dominate mobile trading, with 64,237 operators – representing 77.5 percent – being female. Youth participation is also strong with six in every ten operators aged between 15 and 35, underscoring the sector’s importance as an entry point into employment and entrepreneurship.

However, the survey raises concerns about child labour – identifying 2,087 children aged 10 to 14 engaged in mobile business activities, nearly 80 percent of whom are girls.

The findings further revealed that mobile business operators are predominantly Ghanaian, accounting for 94.2 percent of the total although nearly 5,000 non-Ghanaians are active, particularly in border regions such as Upper West, Volta, North East and Northern.

In terms of economic activity, retail trade dominates the sector. About 74.5 percent of female mobile operators are engaged in the retail sale of food, while 55.5 percent of non-Ghanaian operators are involved in the retail sale of non-food items.

Despite their importance, many mobile operators face economic pressures. More than half earn less than GH¢100 daily, although earnings are relatively higher among male operators. In addition, 35.9 percent of operators work at least nine hours per day, reflecting the demanding nature of the trade.

Open-space businesses

Open-space businesses, which operate from fixed locations without permanent structures, form another major pillar of the informal economy. Nearly 700,000 such businesses operate nationwide, employing over 922,000 people.

Women play a dominant role in this segment as well, accounting for 84 percent of business owners and 79.5 percent of the workforce. The sector is overwhelmingly Ghanaian-owned, with 99.2 percent of businesses belonging to locals.

These enterprises are concentrated in major commercial regions, with more than half located in Greater Accra (23.5%), Ashanti (17.1%) and Central (10.7%). The majority – 68.4 percent – are engaged in the retail sale of food and beverages, making them essential to household consumption and daily commerce.

Operational demands are high, with 63.7 percent of businesses operating at least six days a week. While some achieve relatively strong returns, income disparities persist: about 31.3 percent earn GH¢100 or less daily, while 21 percent report daily earnings of at least GH¢500.

Government Statistician Dr. Alhassan Iddrisu noted that these IBES I findings reinforce the centrality of informal enterprises to Ghana’s economic structure.

As such, policymakers are being urged to prioritise investments in market infrastructure, sanitation, lighting and storage facilities while expanding access to microcredit, digital payments and business training.

Strengthening social protection systems and enforcing child labour laws will also be critical to safeguarding vulnerable groups, particularly women and children, who remain at the heart of the informal economy.

“Government and local authorities should invest in market infrastructure, sanitation, lighting and storage facilities. Financial institutions should expand microcredit, mobile banking and digital payment solutions tailored to small informal businesses.

“Training programmes should strengthen business management, financial literacy and digital skills among informal entrepreneurs. Youth entrepreneurship programmes should support young traders transitioning into more stable businesses.  At the same time, child labour laws must be enforced and social protection programmes should support families to ensure children remain in school,” GSS emphasised.

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