Informal Sector Dynamics and Psychological Well-being in Ethiopian Urban Areas,

Informal sector dynamics in urban areas of Ethiopia have been a subject of interest for researchers examining economic resilience and social well-being. The study employed mixed-methods research design including surveys and focus group discussions. Data from 200 informal sector workers in Addis Ababa were analysed using thematic analysis for qualitative data and descriptive statistics for quantitative data. Findings revealed a significant positive correlation between the level of psychological well-being and participation in informal economic activities, with participants reporting higher satisfaction levels compared to those not involved in the informal economy. The study underscores that involvement in informal sector work can enhance psychological health by providing social support networks and income stability, which are critical for mental health outcomes. Policy recommendations include fostering supportive policies for the informal sector workforce to mitigate stressors and promote better psychological well-being among urban dwellers.