Informal sector impacts are omitted from GDP-based impacts projections. Yet, informal sector activity and small to medium-sized enterprises can be highly exposed to climate extremes, as they are often located in low-lying areas, coastal areas, sloped or other hazardous zones . Businesses and individuals in the informal sector, including construction workers, domestic workers, street vendors and transport workers, often cannot operate during climate shocks due to interruptions in transportation and commodity flows and, without the ability to insure against risk, struggle to recover assets from extreme events such as flooding, landslides and waterlogging . Women are overrepresented in the more poorly remunerated sections of the informal economy .
IPCC
Climate Change 2022: Impacts, Adaptation and Vulnerability
IPCC Report