Shadow entrepreneurs in Kazakhstan earn above average. Most often, they work in the service sector and consider themselves self-employed. Citizens who own businesses but operate outside the system are more prevalent in the western and southern regions of the country. These conclusions can be drawn from the results of a sociological study on informal employment conducted by the analytical company Adam Research, which took place last summer through telephone surveys. The research covered all regions and cities of national significance. The margin of error is less than 4%, reports ranking.kz.
To begin with, 13.6% of the working population can be classified as shadow entrepreneurs, meaning those who "work for themselves" without official registration. Analyzing the results of the sociological survey allows us to highlight the following characteristics of shadow entrepreneurs. Their proportion is higher among men (16.5%) and lower among women (10.2%). Shadow entrepreneurship is somewhat more common in rural areas. A greater share of shadow entrepreneurs is found among respondents with secondary (19.3%) and vocational (13.8%) education.
“These shadow entrepreneurs belong to more affluent segments of the population. However, this group experiences the most unstable income compared to other types of informality. Shadow entrepreneurship is most prevalent in sectors such as beauty services, construction, food services, agriculture, retail trade, and furniture and textile manufacturing,” report specialists from Adam Research.
A breakdown of the income levels of shadow entrepreneurs shows that the largest shares are observed among respondents with incomes between 400,000 and 600,000 tenge (15.2%) and those with incomes above 600,000 tenge (20.5%). The income levels of families of these Kazakhs cannot be considered low either. In the category of respondents whose family income exceeds 600,000 tenge, 13.6% confirmed their status as shadow entrepreneurs, while in the group with incomes above 1 million tenge, the proportion of such individuals was 18.1%.
We suggest examining the data from sociological studies in parallel with the official figures on the shadow economy of the country. Here’s what the Bureau of National Statistics (BNS) of the Ministry of National Economy of the Republic of Kazakhstan says about this. The latest relevant data on the unobserved sector of the economy was published for 2023. According to the source's information, the share of the "gray" economy in Kazakhstan is 17.5%. Compared to previous years, this figure has decreased. However, it is important to note some methodological peculiarities. Since 2023, the methodology for calculating the share of the unobserved sector of the economy in the gross domestic product has changed, and some sectoral indicators in areas such as transport and agriculture have been revised. After recalculating, the indicator for the unobserved sector in these industries halved, directly affecting the final value for the entire economy. If the share of the unobserved sector had been calculated in 2023 using the "old" method, the indicator would have remained at the level of 2022 (18.8%).
The largest contribution to the shadow economy comes from retail trade, whose share is 3.5%. Other sectors with high indicators include socially oriented areas — healthcare (2.1%) and education (1.5%).
Among regions, the highest indicators are shown by: Almaty — 3.9%, Astana — 2.1%, and the south (totaling regions and Shymkent) — 4.2%. The smallest shares of the unobserved sector of the economy in GDP are recorded in Abay (0.4%) and Zhetysu (0.4%) regions.
The results of comparing the share of the unobserved sector of the economy in the regional gross product (RGP) and the share of shadow entrepreneurship identified through sociological surveys are intriguing. In regions with a high share of the "gray" economy in RGP, the proportion of shadow entrepreneurs was also significant. All of them are located in the southern regions and cities. For example, in the Turkestan region, the share of the unobserved sector in RGP was 30.8%, while the proportion of respondents confirming their shadow status in business was 11.6%. A similar situation was observed in Shymkent and Almaty region.
At the same time, it is in the southern regions and megacities that the lowest indicators of active enterprises have been noted. For instance, according to BNS data, only 38.4% of all registered companies in Almaty are actively operating. Another 26% have temporarily suspended their activities, while 24.3% are considered inactive. In Shymkent, the share of active enterprises is also low (34.7%), while in Almaty region, it is 46.7%.
It was previously reported that by 2025, the goal is to reduce the indicator of the unobserved economy in the country to 15% of GDP. To achieve this, the Ministry of Finance proposes to include problematic sectoral issues that slow down the exit of the industry from the shadows as KPIs in the development plans of state bodies.