Employment, Social Affairs & Inclusion

News 25/10/2016

Social enterprises gaining ground in Europe

The number of social enterprises in Europe is increasing and they are engaging in new fields. Many countries are introducing new legislation as well as new support schemes to boost the development of social enterprises.

Social Enterprise written in a notepad with marker

© Shutterstock.com / designer491

Both public and private markets offer new opportunities for social enterprises to start up and grow, reveals a new report published by the European Commission.

Examples of underlying factors behind the development of social enterprises in Europe include

  • increasing demand for general interest services
  • the tendency towards use of competitive tendering by local authorities
  • the possibilities offered in new fields of engagement
  • increasing demand for more ethical business

However there are also constrains and challenges that can hamper the development of social enterprises.

  • lack of business and management skills,
  • need for better understanding of finance markets,
  • insufficient availability of patient capital,
  • too narrow legal frameworks and incoherence in policies and concepts

Country reports

New country reports provide a comprehensive picture of social enterprises and their eco-systems in France, Italy, Spain, Belgium, Ireland, Slovakia and Poland, based on a common definition. A concise EU report sums up key lessons on the recent developments in Europe. The research was conducted by independent academics supported by the EMES network and the EURICSE research centre. In each country the researchers engaged in an interactive process with a wide range of stakeholders to ensure the accuracy of the picture.

The reports place social enterprises in their societal and economic context, notably explaining their relation to so called social economy, which have a strong tradition for example Italy, France, Spain and Belgium. An important finding is that both social economy and social enterprises have shown resilience and job retention during the economic crises and beyond. Because they respond to concrete societal needs and are often locally rooted, they are not exposed to speculative risks or job losses due to relocations.

Some examples:

  • In Italy mainstream enterprises lost almost 500 000 employees between 2008 and 2014, while the overall number of employees of social cooperatives increased from 340 000 to 407 000, thus registering a growth of 20.1%.
  • In Belgium, while employment in the public and private sectors decreased over the period 2008–2014, employment in social enterprises increased strongly (+11.5%); the growth rate in Brussels was even more dramatic (+25%).
  • In France the private economy registered a negative dynamic in terms of job creation over the period 2008–2010, while the trend in social enterprises was positive (+0.8%).

These new reports are part of the Commission's exercise of gradually up-dating the map of social enterprises and their eco-systems in Europe, first time published in 2014.

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