Co-operatives and social enterprises may hold the key to more and better jobs

Co-operatives and social enterprises achieve employment growth at least on a par with other types of organisation, and also create good quality jobs, according to a new report by the University of Warwick, the Fondazione Giacomo Brodolini (FGB), and Eurofound.  

The research team examined co-operatives’ and social enterprises’ resilience to economic changes. Based on new research, their report highlights how the management practices of these organisations helps sustain employment levels and deliver good jobs in the face of structural and cyclical economic changes.

Focusing on twenty case study organisations across five EU countries, including the UK, Peter Dickinson and Chris Warhurst in the University of Warwick’s Institute of Employment Research, Luigi Corvo and Feliciano Iudicone at Fondazione Giacomo Brodolini (FGB) and Stavroula Demetriades of Eurofound investigated the contribution of European co-operatives and social enterprises to job creation and retention; mapped the levels of public or social partner support for job creation in these organisations; and suggested ways to better support co-operatives and social enterprises so that they can continue to create and sustain good jobs.

The researchers found that:

  • Co-operatives and social enterprises proved resilient to the financial crisis and have been successful in maintaining and creating jobs. Social co-operatives in particular have flourished.
  • Workers in co-operatives and social enterprises rate their job quality as high, both in absolute and relative terms.
  • Management skills are a key driver of employment success.
  • Managers in co-operatives and social enterprises tend to access informal support through their own networks rather than access formal support measures offered by governments.
  • Governments could support co-operatives and social enterprises by promoting social value clauses in public tendering rather than lowest cost

Peter Dickinson, from the University of Warwick, commented:

“The challenge for UK and other European economies since the financial crisis is not just how to create jobs, but – in the era of zero hour contracts, the gig economy and flexible labour markets – how to achieve growth in good jobs.

“This study concludes that not only can cooperatives and social enterprises achieve employment growth at least on a par with other types of organisation, they create good quality jobs.  They do this through inclusive management; reinvesting and sharing economic value; shared values; and prioritising jobs not just wages and profit.”

The UK has one of the largest social enterprise sectors in the EU, contributing around €61.6bn to the UK economy. Compared to other EU countries, the UK has a smaller number of co-operatives but a higher per capita membership, with 23 per cent of the UK population in membership. This is second only to Sweden where 45 per cent of the population belongs to a co-op. 32 per cent of UK co-operatives are found in the health and social care sector, 10 per cent are in housing, 9 per cent are in retail and 8 per cent are in finance.

The full report can be accessed at: https://www.eurofound.europa.eu/publications/report/2019/cooperatives-and-social-enterprises-work-and-employment-in-selected-countries