Social enterprises 'increasingly key to the UK economy'

24 October 2016

• UK enterprises which consider social change as a primary objective see income grow and create thousands of jobs
• Aston takes the lead on the UK arm of the world’s largest panel for the study of social enterprises
• The sector found to be leading the way for innovation, with 82% introducing a new product or service in the past year

Businesses and organisations that aim to achieve social change as part of their primary objectives are becoming increasingly significant to the UK economy and creating more jobs than ever before, according to a new study.

The SEFORIS project, the world’s largest panel for the study of ‘social enterprises’ of which Aston University is a key partner, has found organisations that deliver ‘inclusive growth’ are experiencing unprecedented revenue growth and are working with fewer volunteers to instead create new jobs. The full UK report can be found on the SEFORIS website.

Social enterprises are often considered to be small, yet the 135 surveyed in the UK generated £450m in revenues, with almost half (46.5%) reporting revenues exceeding £1m. They are also proving to be significant employers, with 13,705 people being recorded as employed of which 10,482 had a full-time job in a social enterprise.

This rise in job offerings dispels the common assumption that social enterprises are reliant on volunteers. The report found that 1,149 people were provided with full-time volunteering opportunities at social enterprises – a figure dwarfed by those in paid employment.

As these businesses and organisations continue to expand, they remain able to fulfil their social mission by helping hundreds of thousands of people. Miss Macaroon, a Birmingham-based social enterprise who claim to harness both art and science to create modern macaroons, has established itself as a competitive catering business while helping young care leavers and ex-offenders reintegrate with society by training and employing them as bakers.

Rosie Ginday, who as founder of the enterprise is Miss Macaroon, said: “I created Miss Macaroon because I wanted a social enterprise business that combined my passion for premium quality food – born from my training as a high-end pastry chef.

“My ultimate aim was to help youngsters – often care leavers experiencing difficulties – break into highly competitive industry while providing moments of sublime indulgence for my customers. Though our supportive and collaborative approach to all the young people on Miss Macaroon’s courses, young people benefit from pastry chef training, work experience, confidence building and ongoing mentoring.”

The survey found UK social enterprises served 1.3m beneficiaries – including individuals, groups, communities and other social organisations.

The 1,030 social enterprises in the wider SEFORIS survey, the EU flagship research project on social entrepreneurship which looked at nine countries spanning Europe, Russia and China, generated €6.6bn in revenues, employed half a million people, and served 871m beneficiaries.

Professor Ute Stephan, Director of the Aston Centre of Research into International Entrepreneurship and Business, who led the UK branch of the study and co-led the overall project, said: “We are excited to share our findings on social enterprises in the UK. They highlight the important economic contributions that these organisations make to the UK economy – which often go unnoticed.

“These organisations are strictly focussed on their social missions and work towards socially inclusive, healthy and environmentally sustainable societies in an entrepreneurial manner.”

An important characteristic of social enterprises is their operational, or business model. In the UK, 91% of the social enterprises use a fee-for-service model for at least one of their activities, meaning they are directly selling a product or a service on the market. Concurrently, fees for services and sales of products or services are the main source of financing for 63% of the UK social enterprises.

Social enterprises can use multiple operational models alongside each other – and we see that another popular model is the employment model (14%). With the employment model, social enterprises generate social impact by offering employment and training opportunities to their beneficiaries.

The survey also found that UK social enterprises are important innovators. 82% said they introduced a significantly new or improved service, product or process in their organisation in the last year, and 69% introduced a product, service or process that was new to the marketplace.

To explore the significance of these findings further, Aston University will be holding a SEFORIS conference open to social entrepreneurs and organisations, policy makers, local government representatives and academics. The aim of the conference is to identify and share best practices of how social enterprises can address challenges of governance, financing, innovation and scaling following the findings of the SEFORIS survey.

The conference is free of charge to attend and will be held in Aston Business School (Conference Aston) on 9 December 2016. To find out more and register, visit http://www.aston.ac.uk/aston-business-school/events/seforis-2016/

For catering purposes, please register before 25 November 2016.

ENDS

Notes to the editor

• The full UK report can be found at www.seforis.eu/united-kingdom
• The full cross-country report, looking at countries spanning Europe, Russia and China, can be found at www.seforis.eu/cross-country-report
• SEFORIS stands for Social Entrepreneurship as a Force for more Inclusive and Innovative Societies. It is the EU’s flagship project on social entrepreneurship. It started in 2014, following the SELUSI project and is led by the international team of interdisciplinary researchers. SEFORÏS’ aim is to better understand the role that social enterprises can play in the evolution of inclusive and innovative societies. SEFORÏS’ rigorous research provides unique insights on the state of social entrepreneurship in the UK, the EU and beyond.
• Aston University Professor Ute Stephan is one of the principal investigators of the SEFORIS project and a member of the SEFORIS academic board. She was also one of the lead researchers on the SELUSI project, the predecessor of SEFORIS. Other Aston team members include Dr Emma Folmer and Inna Kozlinska.
• The SEFORIS project has received funding from the European Union’s Seventh Framework Programme for research, technological development and demonstration under a grant agreement. More information about this is available at www.seforis.eu
• Infographics summarising the survey findings have been included below and are free to be republished.
• Founded in 1895 and a University since 1966, Aston is a long established research-led university known for its world-class teaching quality and strong links to industry, government and commerce.

For more information, call Ben Kennedy, Press & PR Officer, on 0121 204 4592 or email b.p.kennedy@aston.ac.uk