A result of the excellent research being conducted at the YOUTHShare project, the new paper discussing the dynamic of Social Economy in addressing the unemployment in South Europe was recently published.
Quite promising yet marginal? A comparative study of social economy in the EU South comes at the end of a long stream of research that started back in November 2018. The first milestone in that course was the long transnational report on the impact of employment policies on Social and Sharing Economies in March 2020. Based on that report and further study and fieldwork, Athina Avagianou (Doctoral Researcher), Kostas Gourzis (Post-doc Researcher), Theodoros Iosifides (Professor) and Stelios Gialis (Associate Professor) from the University of the Aegean and Ioannis Pissourios (Associate Professor) from the Neapolis University Pafos produced the new scientific paper scrutinizing the actual impact of social entrepreneurship on unemployment in South Europe.
The dual economic and public health crisis has had a major impact upon the societies of Cyprus, Greece, Italy and Spain that constituted the focus countries of the paper. In that decade-long conditions unemployment reached record levels; and amidst that societal and economic turmoil, voices in academia and politics call for a refocus on socially-sensitive economic organization. In this conjuncture, the EU has promulgated a broad legislative and regulatory framework establishing an enabling setting for social enterprises. The focus countries, at different points, adopted this trend; with Italy and Spain having since many decades both a regulatory framework and an ecosystem while Cyprus and Greece only recently (the implementation of the pertinent legislation in Cyprus is still pending).
Social Economy, often being called the third sector of the economy, typically pertains to collective work experiments that adopt a bottom-up organization and a democratic process in production. Traditionally, these entities cover the gap left after the state had rolled back, especially in fields of welfare provision. That also allowed for governments to “invest” in the development of the Social Economy exactly in order to cover such needs.
A combination of a pressing social environment, local path-dependencies and different targets between the States and the social entrepreneurs or potential social entrepreneurs have formed a rather convoluted regulation framework that presents a complex picture across the countries of the EU South. By applying a mixed methods approach, the paper studies the development of Social Economy per country in quantitative as well as qualitative terms. Most importantly, though, it studies the ways in which social enterprises’ gradual embeddedness within market mechanisms has hybridized their nature and the way that this affects the quality of employment they offer.
The share of Social Economy workers in the overall working population in Spain and Italy is the highest in the focus countries, 6% and 6.5% respectively, yet it remains admittedly low. The respective percentage for Greece is a mere 0.3% and for Cyprus 0.9%. The regional particularities play a significant role in the local concentration of Social Economy workers and already reveal explicable results. In Spain there is a clear North/South divide with the South hosting a lot more Social Economy workers. In Italy, on the other hand there is a relatively equal spread of workers per region. In Greece, the tourism dependent economies of South Aegean and Ionian Islands, as well as the capital region of Attica present higher concentration of workers in the Social Economy. In order to measure the actual development in the said field, the paper identifies the spread of workers to the number of social enterprises. In Spain 1.191.000 employees/members (6% of total workforce) are employed by approximately 106.000 Social Enterprises (1.5% respectively). On the other hand, in Italy 1,209,000 employees (6.5% of the country’s total workforce) are shared between 58.000 enterprises (1% of all businesses), presenting therefore a differential level of development. On top of low workers’ numbers, Greece and Cyprus boast equally low numbers of enterprises. Comparing the two countries reveals that Cyprus registers a share of Social Economy workers that is almost five times higher than Greece’s: 0.9% (3.000 in absolute numbers) as opposed to 0.3% (12.500 in face value). Similarly, the share of Social Economy enterprises in Cyprus is four times higher than in Greece: 0.2% (60 entities) as opposed to 0.05% (400).
Turning to the qualitative results, the paper sheds light on the operational exigencies of Social Economy in South Europe. Despite the increased interest around Social Economy the last decade, much of the promised support has not arrived. There are cases, especially in Spain and Greece, where promulgated programs never reach the stage of implementation, leading many social enterprises to search for financial stability through private funding and put more effort into increasing the revenue coming from their own commercialized activities. In this process, they get fully incorporated into the market structures and become dependent upon commercialized ventures. As a result, their operation becomes ‘hybridized’, if not proft-driven. However, with this hybridization taking place amidst the current recessive conjuncture, most ventures fail to generate sufficient revenues and end up practically underfunctioning and foundering.
The hybridization of social enterprises has two main implications. First, many social enterprises appear to be drifting away from their primary goals related to social and environmental causes and the creation of secure and good quality jobs. Struggling enterprises unavoidably prioritize financial stability over these aims. The second crucial implication is that they tend to offer employment of lower quality. Most enterprises employ personnel under part time or temporary arrangements. Key informants from all countries confirmed that this low-road flexibilization constitutes a strong tendency within the Social Economy. In these adversary conditions, one has to also add the cases of predatory enterprises which go against core Social Economy goals and blemishing the picture of Social Economy.
If we look closer at the previous ascertainments, the paper notes that despite the instrumentalization of the Social Economy in covering the welfare gap, the pertinent policy framework remained poor and the goals it set are often unattainable. Individuals with a de-motivated past and the inactive parts of the youth are less likely to (re)enter the labour market or upgrade their skills through their experience with Social Economy. Instead, the majority of employees or members in social entities are people readily able to develop a career anywhere else. Yet, as Social Economy entities are further embedded within dominant market circuits (hybridization) they adopt businesslike practices where labor devaluation and precariousness are reproduced and become normalized.
The marginality of Social Economy is undoubted. In order to promote the promising features of the “third sector” of the economy, the paper concludes with suggesting a policy re-evaluation along three main lines. The first concerns the establishment of training programs related to SE and their direct connection to unemployment programs. The second line is the need to move beyond a state/ market dipole and adopt a more flexible mixture of public funding and private led initiatives. The third line is the establishment of robust SE ecosystems across multiple scales.
Ioannis Papageorgiou & the YouthSHARE Team
