Creating a World Without Poverty?

By Hannah Feldman

Sat on the floor of a small shared room on the outskirts of Metro Manila, Mae* and her sisters are hurriedly crafting necklaces, while their small children treat them as their personal jungle gym – climbing around their shoulders with giggles of glee. The only light comes from a crack in the corrugated iron roof, where rainwater slowly drips through. “We have 25 orders – it will be enough to pay our electricity bill for the whole month!” Mae tells me happily. The sisters have been making jewellery for social enterprise Caring Crafts since they lost their jobs at a garment factory in 2008. Caring Crafts was established by a successful Filipina entrepreneur to provide an income for unemployed mothers in Manila’s informal settlements, and is one of an estimated 30,000 social enterprises in the Philippines designed to tackle widespread unemployment and poverty.

Social entrepreneurship has created a major buzz amongst policy-makers, politicians, celebrities, journalists, and, more recently, academics. Text produced about social enterprise present a wholly positive picture of the phenomenon, and evoke the micro-finance mania of recent decades. SEs, we are told, can achieve empowerment, social transformation, regeneration – even, Mohammed Yunus tells us, create a world without poverty. This mania has taken hold of the Philippines, where the Congress are currently debating the Poverty Reduction through Social Entrepreneurship (PRESENT) Bill. If passed, the bill would grant favourable tax and policy status to these entities, and recognise them as a key driver for tackling the country’s extreme poverty rates.

Caring Crafts is one of a growing number of “WISE”: “Work Integration Social Enterprises” that support socially-marginalised people into employment. They are part of a global movement of “inclusive businesses”, in which the poor are “included” into the economy as producers and consumers. WISE conceptualize poverty as a state of exclusion and marginalization from the modern world system, and the solution, labour market participation. The goal of the entrepreneurs is not to change the relations of capitalism – rather to incorporate those who have been excluded from it.

For Mae and her sisters, the orders they receive through Caring Crafts certainly support them to buy essential resources, such as rice, electricity and transport for their children to go to school. Meanwhile, their neighbour Jovelyn has been hailed by national press as a “success story” of social enterprise. Previously jobless, she has risen from the ashes of Manila’s notorious Smokey Mountain slum to become manager of Bella, a hair salon that employs the “unemployable”. She too has benefited from social entrepreneurship: “Before it was hard, because there’s times where we don’t have food to eat, and we’re asking food from the neighbours. It’s changed a lot – now I send my two siblings to school, I send them money for the bills. I can even watch a movie, I can go to a restaurant to eat with my family”, she explained.

Nevertheless, these enterprises are fully embedded within the mainstream market, and consequently, they absorb the very problems they try to respond to. In order to remain competitive and maintain regular custom, they have to keep prices low, quality high, and deadlines short. The poor’s well being is dependent on the commercial success of the social enterprise: when it is thriving, they benefit, but when demand is low, their working hours and income suffer.

Mae’s order is the first she has received in three months. Although she will earn £2.40 per piece – three times the amount per piece she earned at the garment factory – the high-value necklace takes an entire day to craft. This translates to a significantly lower income than the £7.20 daily minimum wage mandated for regularised employees.

Despite working as a full-time manager of Bella, Jovelyn still lives in notorious Smokey Mountain, sharing a government-provided room with her twelve family members. Meanwhile, her colleague June works a zero-hours contract, for a day rate of £7.40. “In a social enterprise, your salary is too small, so you have to think how to survive”, June told me one day. “You have to be diskarte [streetsmart]. Like me, I don’t eat dinner when I get home… I borrow money – but just a small one because it’s too hard to pay. You don’t have a chance here, you can’t be rich here”. The founder of Bella explained that market forces prevented him from paying more. “I’m hoping we will one day be able to increase wages”, he said. “I try – I give a little over minimum wage. But we need to be profitable before we can afford to sustain a much higher pay for our people”.

WISE, by their very nature, work with the most vulnerable, socially excluded people, who may be forced to accept these jobs out of sheer necessity. “We don’t have a lot of choice, because we didn’t finish studies”, June explained. Under such acquiescence, economic inclusion through WISE can unwittingly become adverse incorporation into unequal, insecure capitalist relations that enhance the vulnerability of the poor.

 “[R]eforms which have a palliative character are not only ineffectual, but prejudicial, when the government is confronted with evils which must be cured radically. We would be tempted to say that all the partial reforms are only plasters and salves of a physician who, not knowing how to cure the cancer, and not daring to root it out, tries in this way to alleviate the patient’s sufferings”.

These words were written by Jose Rizal, the national hero of the Philippines, who led the country to independence in 1898. Although social enterprise can certainly “alleviate the patient’s sufferings”, these well-intentioned partial reforms fail to root out the deeper structural causes of poverty. They rely upon the market, and consequently, they absorb its problems: the poor remain vulnerable, tied by sheer necessity to insecure, low paid, casual employment. Incorporating people into exploitative capitalist relations, WISE offer little to no opportunity to accumulate, and the poor remain powerless.

*All names of people and organisations have been changed to protect anonymity

Hannah Feldman graduated from the MA in Social Development at Sussex in 2017 and is now working as Programme Officer for the Good Jobs Campaign at Citizens UK.  

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