‘Social enterprises’ help break cycle of poverty, Therrien says
It’s a new way of thinking for employers, and a new opportunity for workers
The introduction of social enterprises and social procurement to Peterborough could help people who have barriers to employment, says the city’s mayor.
The concept could lead to more jobs, increase the potential for a living wage and ward off generational poverty, Diane Therrien said.
Social procurement is a way to get goods and services for the “cheapest price for the best value” through the marketplace and use the dollars spent for achieving a social purpose, said Ralph Gutkin, co-chair of the Kawartha Social Economy Network and CEO of Clean Slate Enterprises.
“We have to understand every time something is acquired, there is an intended or unintended consequence to it,” Gutkin said.
“Whether it is social, environmental or economic. The idea behind social procurement is to use your dollars you are spending to achieve social purpose. Those are purposes and outcomes a community decides it wants to see happen.”
City council passed a motion in March to begin looking at developing strategies, setting aside $100,000 for the process.
“Back in March, the report was approved to issue a Request for Proposals to hire a consultant to help the city develop a social procurement framework and pilot project,”
Therrien said. “That has been a bit delayed because of COVID, but the RFP has been drafted and the city is hoping to put that to the market in the coming weeks.”
Examples include reduced pollution or providing employment for people who might have issues being hired, Gutkin said.
“(If ) we want to reduce pollution, what we do about that is we look at ways in which through our spending dollars
we can achieve that purpose or we may want to provide employment opportunities for people living on the margins,” Gutkin said.
Social enterprises use social procurement not only to buy from suppliers meeting their goals, but to help employ people who might have barriers.
“(A barrier is) anything that may prevent somebody from being hired in the workplace and there are any number of barriers: a criminal record, gaps in employment, addictions, mental health, language barriers, chronic poverty, anything that prevents anyone from participating in the normal workforce,” Gutkin said.
Therrien said the term “social enterprise” isn’t well-known yet, but there are a lot of businesses already doing something like it.
“It is not a mainstream sort of term, but there are things happening that would qualify as that, but they might not even realize,” she said.
Farmers markets and farms are good examples of social enterprises because they might not offer much full-time employment, but it is meaningful work and helps the economy, she said.
“You are getting people to work for those farms and companies need labour,” Therrien said.
People might not be able to do a 40-hour work week, but it provides them opportunities for meaningful employment and to contribute, she said.
Madeleine Hurrell, entrepreneurship officer at Peterborough and the Kawarthas Economic Development, said businesses that integrate social responsibility into their business models tend to have happier employees.
“Businesses that integrate a component of social responsibility have increased employee loyalty,” Hurrell said. “They hire local and their workforce embodies the values they have. When you believe in what the company does, it can be very powerful for the workforce.”
Giving someone a living wage over a minimum wage can make a world of difference in their circumstances, Gutkin said.
“(A living wage) tends to be higher in social enterprises. The difference between paying somebody a minimum wage and a living wage is significant,” he said. “The idea of a living wage provides an opportunity for someone to pay for, not just the basic necessities, but a bundle of goods that represents a more decent lifestyle. It might include a car; it might include some other aspects of a better life.”
Training someone who might have barriers to employment can have a drastic yet positive effect on their life overall, he said.
“If you give a person training to start working on a temporary or a casual basis, they increase their ability on the job and they become more ready to work, more used to work and become fully employed,” Gutkin said. “Then you take that person who might have been previously homeless and give them not only a home, but maybe also give them food security.”
Several people are going to use this opportunity to lift themselves up out of poverty or the social situation that binds them, he said.
“Statistically, you are going to find quite a number of people are going to use the opportunity of the protected environment in a social enterprise to change their economic and social circumstances,” Gutkin said. “It has been demonstrated again and again that social enterprises can have that impact.”