The authors test a theoretical model incorporating capital market failure and labor market segmentation into sectors of (largely formal) wage employment, (largely informal) self-employment, and family enterprise employment, using detailed household survey data on workers in Nigeria in which credit-constrained individuals draw self employment capital from family assets. The results demonstrate very low rates of mobility across the three sectors, with family enterprise workers having the highest mobility and self-employed people having the lowest. The findings show that wage earnings do not alleviate liquidity constraints, but they do suggest that both liquidity and skill transferability are important for mobility.