In the sprawling urban landscapes of the United States, cities like San Francisco and New York present complex, dynamic economies where formal labor markets dominate the economic narrative. Yet beneath this veneer of regulated employment lies a substantial sector of informal work—street vendors selling food and crafts, waste pickers collecting recyclables, and countless others who operate beyond the reach of formal labor protections and regulatory frameworks. This informal workforce is often an overlooked pillar of urban economic resilience, especially in times when formal employment opportunities shrink under economic or social crises. However, local governance frameworks frequently marginalize these workers, perpetuating exclusion and missing vital opportunities to harness their potential for inclusive economic development.
Informal work, despite its prevalence and importance, remains mired in a complicated relationship with urban regulation. In cities like San Francisco and New York, the prevailing approach to managing informal workers tends to be exclusionary, often framed in terms of legality, health, safety, and public order concerns. Street vendors, for example, face rigid licensing requirements, intense policing, and limited access to public spaces. These regulatory measures, while ostensibly designed to maintain urban order, place significant constraints on the ability of informal workers to contribute meaningfully to local economies. This regulatory friction fails to acknowledge the adaptive strategies that informal workers employ to sustain their livelihoods and support broader economic inclusivity.
Parallel to street vending, the sector of informal waste picking—a practice that involves collecting recyclable materials discarded in urban environments—demonstrates a similar pattern of marginalization. Though waste pickers play critical roles in urban waste management and environmental sustainability, many municipal policies treat them as nuisances rather than partners. They often operate without access to formal recognition, social protections, or support systems, limiting their capacity to improve living conditions and formally contribute to sustainable urban development. The invisibility of these workers in urban planning highlights a structural tension between regulatory governance and inclusive economic development.
This punitive regulatory stance toward informal labor starkly contrasts with emerging governance models in the Global South, where multiple cities have begun embracing more inclusive, participatory approaches to managing informal work. Here, rather than forcibly evict or criminalize street vendors and waste pickers, local authorities engage in dialogues with these laborers and incorporate their needs and contributions into urban policy frameworks. Such approaches recognize informal workers not merely as survivalists but as active agents who enhance urban economies and social fabrics through their everyday labor. These examples illustrate the transformative potential of inclusive governance to rewrite the narrative around informal work.
The governance frameworks in many US cities, however, continue to default to formalistic, exclusionary paradigms that fail to capture the nuances and contributions of informal sectors. This often results in policies that either deter informal work or push workers into more precarious, invisible forms of labor without social protections or labor rights. As economic uncertainty persists, especially exacerbated by migration and employment crises, such approaches marginalize those most vulnerable, reinforcing cycles of poverty and economic exclusion. Recognizing informal workers as legitimate participants in the economic ecosystem is thus a critical step toward fostering inclusive and resilient urban economies.
Urban planning and economic development theories have long celebrated the potential of inclusiveness in economic participation, yet informal labor remains a blind spot in these discourses. Informal workers often face systemic barriers that restrict their access to public goods, social protection, and legal recognition, all of which are crucial for unlocking their economic contributions at scale. It is increasingly apparent that urban regulatory systems need to transition from punitive frameworks to ones that foster collaboration with informal workforces, integrating them as vital components of sustainable urban development strategies.
Understanding the political economy of informal work in cities like San Francisco and New York requires looking beyond the surface level of governance codes and enforcement practices. It entails recognizing the historical, socio-economic, and cultural factors that have shaped perceptions of informality. These cities have diverse immigrant populations and economic disparities that generate demand for inclusive labor markets capable of accommodating diverse forms of work. However, without flexible regulatory frameworks that legitimize informal labor and provide pathways toward formalization or at least protection, the potential contributions of street vendors, waste pickers, and similar workers remain stifled.
Case studies from the Global South offer compelling insights for reimagining this governance challenge. Cities such as Bogotá, Mumbai, and Johannesburg have experimented with participatory policy-making that brings informal workers into decision-making arenas. These cities have instituted flexible licensing regimes, created dedicated vending zones, implemented cooperative waste-picker programs, and provided access to social benefits. Such initiatives exemplify how governance can move towards inclusivity by acknowledging the socio-economic realities of informal work and leveraging it as a catalyst for economic inclusion and poverty reduction. Lessons from these contexts can provide instructive blueprints for US cities seeking to reform governance mechanisms.
Furthermore, informal urban work is intricately linked to migration and employment crises. Many informal workers are migrants—often undocumented—who rely on these income-generating activities as essential safety nets in hostile labor markets. Regulatory policies that criminalize or fail to recognize their contributions exacerbate vulnerabilities and inhibit social mobility. By contrast, inclusive governance frameworks that provide recognition and protections can empower these workers, enabling them to participate more fully in urban societies and economies. This shift not only benefits individual workers but also contributes to broader goals of social equity and urban resilience.
To unlock the promise of informal work as a driver of inclusive economic development, cities must adopt governance approaches rooted in participation, flexibility, and recognition. Rather than imposing rigid regulations that criminalize informal activities, urban policymakers need mechanisms that allow informal workers to operate transparently and sustainably within the cityscape. This includes creating avenues for dialogue, developing tailored licensing schemes, ensuring access to urban infrastructure, and addressing systemic discrimination against marginalized groups. Such initiatives can also facilitate better urban data collection and planning, incorporating the informal sector into economic analyses and development strategies.
Informal workers themselves are often innovative, resilient, and resourceful actors who navigate precarious circumstances to sustain livelihoods and support their families. Their work fills gaps left by formal institutions, from providing affordable food and goods in underserved neighborhoods to contributing to environmental sustainability through recycling and waste collection. Thus, inclusive governance not only reflects social justice principles but also strategically enhances urban efficiency and sustainability. Embracing this reality challenges traditional regulatory mindsets and calls for a paradigm shift in how cities conceptualize labor, economy, and social inclusion.
The dismissal of informal workers as mere nuisances or illegal actors is increasingly untenable given the realities of 21st-century urban economies. Formal labor markets alone cannot absorb the entirety of urban workforces, especially amid ongoing economic transformations and migration patterns. The failure to integrate informal workers into the economic fabric risks entrenching inequality, increasing social tensions, and undermining urban cohesion. By contrast, governance models that foreground the dignity, rights, and agency of informal workers have the potential to unlock vibrant, inclusive, and adaptive urban economies that work for all residents.
Moreover, attention must be paid to the intersectionality of informal work with gender, ethnicity, and immigration status. Many informal workers belong to marginalized social groups facing compounded barriers to social inclusion and economic advancement. Effective governance models must be sensitive to these dynamics, ensuring that policies do not reproduce existing inequalities but instead actively promote equity and empowerment. This dimension further complicates regulatory reforms but is critical for genuine inclusivity and sustainable socio-economic development.
Technological advancements also present new possibilities and challenges for informal workers and their governance. Digital platforms, mobile payment systems, and social media enable informal traders and waste pickers to expand markets and mobilize collectively. However, digital divides and lack of formal recognition can leave informal workers vulnerable to exploitation and exclusion. Policy frameworks need to evolve to incorporate these digital realities, ensuring that technological integration supports rather than undermines informal workers’ economic and social inclusion.
Ultimately, the governance of informal street work in US cities stands at a crossroads. As the pressures of economic inequality, housing crises, and migration intensify, urban policymakers face urgent demands to rethink traditional regulatory regimes. Embracing inclusive governance practices proves not just a moral and social imperative but a strategic economic choice that can fortify urban resilience and shared prosperity. Drawing lessons from international best practices while adapting them to local contexts, cities like San Francisco and New York can catalyze a transformative shift in how informal work is recognized, regulated, and integrated into broader urban development agendas.
The transformation requires a concerted effort to build coalitions among informal workers, municipal governments, civil society groups, and academic institutions. Supporting informal workers with legal recognition, social protections, access to credit, and infrastructure can stimulate entrepreneurship and economic participation. Such comprehensive strategies underscore the need to move beyond simplistic regulatory binaries of legality versus illegality towards more nuanced, equitable approaches that celebrate the economic and social contributions of informal labor.
In conclusion, the persistent governance challenges facing informal workers in US cities reveal deep-seated contradictions in urban policy. Informal work serves as a vital safety net for marginalized populations amid capitalist labor market failures, yet it remains legally tenuous and socially stigmatized. Recognizing and empowering informal workers through inclusive, participatory governance models holds promise for advancing economic inclusivity and social justice within increasingly diverse and complex urban environments. The time has come for US cities to embrace this paradigm shift and harness the full potential of informal work for sustainable urban futures.
Subject of Research: The governance of informal street work and its implications for inclusive economic development in US cities, focusing on street vendors and waste pickers.
Article Title: The governance of informal street work in San Francisco and New York City
Article References:
Farah, I., Devlin, R.T., Hartmann, C. et al. The governance of informal street work in San Francisco and New York City. Nat Cities (2025). https://doi.org/10.1038/s44284-025-00321-y
Image Credits: AI Generated
