At independence in 1980, Zimbabwe inherited a dual (separated) and enclave (isolated) economy characterised by a high level of segmentation. A relatively developed formal sector, accounting for just over a million employees co-existed with an underdeveloped communal and informal sector, making up the non-formal segment of the economy. This formal sector is the one that was officially supported through various government policies and was expected to be fulcrum of job creation. The policy of separate development was such that even those with jobs in the formal sector maintained a home in the communal areas (dual home ownership) because they were not meant to be accommodated permanently in the formal sector, which was predominantly urban.
Post-independence policies largely perpetuated the inherited dualism and enclaves of the economy, with the Economic Structural Adjustment Programme (ESAP) in particular entrenching this segmentation. The labour market was likewise segmented, with the burden of employment creation and the focus of development policies, falling largely on the formal sector alone. Whereas 250-300,000 school-leavers entered the labour market each year in the 1980s, the economy only created on average 18,000 jobs. The 1990s and new millennium have seen an exponential contraction of the formal sector, severely compromising and limiting its potential contribution to economic growth, development and general income levels. The formula of imbalance was further complicated by traditional biases that condemned women to the non-productive informal and rural enclaves, excluding them from the benefits that accrue to organised value adding economic activity.