The Relationship Between The Household Services Sector and Poverty Reduction Indicators

Abstract

The household services sector plays a critical role in shaping socio-economic development, particularly in addressing poverty and inequality. General background reflects increasing recognition of the informal and formal household services' contribution to employment generation and welfare improvement. Specific background centers on the sector’s role in supporting low-income families through job creation, especially for women and unskilled workers. However, a knowledge gap exists in understanding the direct linkage between household services and measurable poverty reduction indicators. This study aims to analyze how growth in household services correlates with poverty alleviation, using employment rates, income levels, and access to basic needs as benchmarks. A mixed-method approach combining econometric analysis and case studies was adopted. Findings show a statistically significant relationship between household service expansion and poverty reduction, particularly in urban areas where service demand is high. The novelty of this research lies in its integration of microeconomic household data with macro-level poverty trends. Implications suggest that targeted support for this sector, including formalization and skill development policies, could contribute effectively to national poverty reduction strategies.