Last autumn, the number of those in employment in Italy topped 23 million for the first time since 2008, a milestone celebrated as a sure sign of Italy's economic recovery. But a new report warns that the country's illegal economy is growing fast, with many unscrupulous employers taking advantage of the uncertainty created by the crisis to exploit desperate employees.
Between 2012 and 2015, legal employment fell by 2.1 percent, while the number of those working illegally in Italy soared by 6.3 percent, the study revealed on Wednesday. It was published by Confcooperative, an organization representing Italian cooperatives, and Censis, a socio-economic research institute.
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"Through this report, we denounce and say 'enough!' to those who create competitive advantage through the irregular cutting of labour costs that means denied rights and exploited workers," said Maurizio Gardini, president of Confcooperative.
In total, more than 3.3 million people are thought to work in Italy’s illegal or black economy, leaving them vulnerable to abuse by their employers, such as dangerous working conditions or low wages.
The report showed a huge gap between hourly wages in the regular and irregular economy; in the industrial sector, wages are around 53.7 percent lower for those working illegally, and in agriculture the gap is around 36 percent. The companies that hire them cut their own labour costs by 50 percent through tax evasion and failing to provide social security and health coverage for workers.
The lack of regulations also presents a danger to health and safety of the public if bosses urge workers to cut corners in crucial sectors such as food or building.
Half of those people affected by the economic crisis have been forced into the illegal economy, the report warns. In the report, titled ‘Denied, irregular, drowned: The dark side of work’, Censis-Confcooperative states that between 2012 and 2015, 462,000 jobs disappeared in Italy, while in the same time period, the number of those illegally employed grew by 200,000.
The most affected sectors were domestic work, including cleaners and caregivers, where the rate of irregularity was estimated at almost 60 percent. This was followed by the agricultural sector, with an estimated irregularity rate of 22 percent, then the housing and catering sector (18 percent) and the building industry (16 percent).
There was also a stark regional divide, with rates of employment in the black economy were highest in the south. In Calabria and Campania, 9.9 percent and 8.8 percent of workers respectively were believed to be working illegally, followed by Sicily at a rate of 8.1 percent and Puglia at 7.6 percent.