Contribution of the informal sector towards sustainable livelihoods: evidence from Khayelitsha Township, Cape Town

PurposeThis study aims to investigates the contribution of the informal sector towards secure livelihoods. Using a case study design, the study focusses on Mandela park, situated in Khayelitsha Township, Cape Town, in the Western Cape province of South Africa. Khayelitsha is predominantly an old township established by the apartheid government using unjust segregation laws to foster spatial planning that isolated people of colour in areas with insufficient infrastructure and informal economic activities. Therefore, informal trading became a survival strategy in Khayelitsha, attracting an increasing number of informal traders in public spaces within the township in pursuit of livelihoods. Informal activities are generally conducted to generate income and secure sustainable livelihoods.Design/methodology/approachThis study uses a qualitative research design, incorporating structured interviews instrumental in data collection and in-depth thematic analysis.FindingsThe study findings reveal that the informal sector positively contributes to the sustainable livelihoods of those involved in the informal sector and the relatives of those through income generation, family support, wealth creation, source of employment, business incubation and innovation and creativity.Originality/valueThe study concludes that given the increasing unemployment rate in South Africa, caused by the stagnant economic growth rate, policymakers should rethink their policies on the informal economy, acknowledge the sector's relevance and support the sector.