Neoliberalism, informal employment and post-communist economies: A tale of a debt-seized worker

Abstract

This article examines the impact of neoliberal economic policies on workers in post-communist economies, with a particular focus on the rise of informal employment. Using the life story of David, a worker in the Czech Republic, we trace the trajectory of labour precarity from the 1990s to the present. During the 1990s, the rapid opening of the personal credit market – without adequate regulatory safeguards – led to a surge in household debt. At the same time, unemployment, previously non-existent due to the state’s system of compulsory employment under communism, became a widespread issue. As a result, a significant number of workers found themselves trapped in a cycle of debt enforcement, which in turn pushed them into informal employment as a means of survival. Through his case, we argue that debt functions as a structural mechanism that entrenches informality, further reinforcing the asymmetrical power relationship between capital and labour in post-communist economies.