Social Firms and miEnterprise

What are Social Firms?

Social Firms are enterprises specifically designed to create jobs for people with disabilities or other severe disadvantages in finding employment - this much is universally agreed. Often, however, there is a little more to understanding the Social Firm model than this basic definition might suggest. Uncertainty arises, for example, if we ask a question like

how does the Social Firm model differ from older 'industrial therapy' or 'sheltered employment' models?

In some countries this difference is expressed mainly in the legal structures Social Firms use – such as co-operatives – which imply doing things with people rather than for people. In the UK however Social Firms are rarely co-operatives, and the umbrella body Social Firms UK has therefore developed a more extensive values-based definition of Social Firms, under the headings Enterprise, Employment and Empowerment. This definition (summarised here) is quite lengthy, but in essence, Social Firms are a modern development of the old 'sheltered employment' models, taking on board

  • ideas around social and financial inclusion – employing both disabled and non-disabled people together in real jobs – and
  • the ideas of the broader social enterprise movement – that it is possible to use self-financing business structures and methods to achieve social benefits.

Geof Cox Associates are specialists in Social Firm development, and Geof Cox is a key advisor to Social Firms UK, and author of a number of important publications for both Social Firms UK and other organisations such as RIPFA.

Where are Social Firms going?

The key argument over the future of Social firms might be put like this:

An alternative to the Social Firm model is proposed by a number of recent supported self-employment initiatives, such as the 'miEnterprise' project.

This argues that although Social Firms are indeed an excellent solution for many disabled people, for those furthest from the labour market, such as learning disabled people in the local authority care system, the problem with Social Firms is that they require a sudden change from attending a day centre and getting welfare benefits to work and wages. This is because the operation of minimum wage, benefits and other regulations make it very hard to build up work and productivity slowly: you have to be either out of work or very much in work - regularly, productively and earning over the minimum wage.

These regulations, however, do not apply to self-employment.

What miEnterprise aims to do therefore is lower the threshold for self-employment – to do the paperwork, accounts, selling, and so on - so that learning disabled people can make the products or provide the services they like and get paid for them – whether they work 4 or 40 hours; whether they get £10 or £100 per week.  The idea is that 'earning disabled people' will then be able to make a slow, low-stress and flexible transition from care to employment - in a Social Firm or elsewhere.

The introduction of individualised budgets is also sometimes seen as favouring more individual solutions such as self-employment.  Perhaps both individualised budgets and supported self-employment reflect broader social changes - more esoterically, it has been argued by some economists that the transition we are currently experiencing to a universally networked knowledge-based economy will mean the decline of the Firm itself.

For more discussion on this go here.