Abstract. Using microdata from the 1993 and 1998 Living Standards Measurement Survey (LSMS) of Nicaragua, this paper analyzes the propensity of informal sector workers to queue for formal sector employment as well as employer behavior related to the selection of individuals from the informal sector queue. The nature of the queue is also examined over time to determine informal sector workers’ response to national market-based reforms. The results indicate that informal workers do indeed queue for formal sector employment and the nature of the queue has become more pronounced during the time period under consideration.