Assessing the role of entrepreneurship industry and SMEs to economic growth in South Africa

Abstract

The study looked at the role and contribution of entrepreneurship industry to foster social and economic development through small, micro, and medium-sized businesses in South Africa. The conceptual research looked at the influence of small, micro, and medium-sized businesses (SMMEs) on South African development. The study's objective was to evaluate how small, medium-sized businesses (SMMEs) are now driving economic growth and solving social issues in a setting where big businesses and governments appear to be doing very little. As a result, the study examines how SMMEs might help the nation solve persistent societal evils including poverty, inequality, and social isolation. A desktop literature review research design was adopted to collect data on the role of entrepreneurship in South Africa, policies and practices of big business and government that exacerbate social issues in communities and impede socioeconomic development, as well as the specific roles that SMMEs play in achieving socioeconomic development goals. Findings from research indicate that, among other development outcomes, SMMEs are at the vanguard of creating jobs and fostering social and political justice in the nation. Future empirical studies that account for and evaluate the importance of SMME contributions to the construction of economic, social, and political justice in the nation are advised because this work lacks the empirical support necessary to substantiate its conclusions and observations.  

Keywords: {'name': 'Entrepreneurship'}, {'name': 'Development'}, {'name': 'Economic'}, {'name': 'SMME'}, {'name': 'Poverty'}, {'name': 'Sustainability'}

Authors & affiliations

Trisha Ramsuraj
Affiliation not supplied

Deposited references

Supplied references, not a list of publications citing this article.

Agupusi, P. (2007). Small Business Development and Poverty Alleviation in Alexandra, South Africa, Norwich: School of the Development Studies University of East Anglia.

Ahiawodzi, A.K. & Adade, T.C. (2012). Access to Credit and Growth of Small and Medium Scale Enterprise in the Municipality of Ghana. British Journal of Economics, Finance and Management Sciences, (6)34–51.

Ande. (2012). Small and Growing Businesses: Investing in the Missing Middle for Poverty Alleviation Literature review, Aspen Network of Development Entrepreneurs.

Audretsch, D., Carree, M., van Stel, A. & Thurik, A. (2000). "Impeded Industrial Restructuring: The Growth Penalty. Centre for Economic and Policy Research Discussion Paper. Bello, A., Jibir, A. & Ahmed, I. (2018). Impact of Small and Medium Scale Enterprises on Economic Growth: Evidence from Nigeria. Global Journal of Economics and Business, 4(2), 236244.

Bureau for Economic Research. (2016). The Small, Medium And Micro Enterprise Sector Of South Africa Note Research 1, Small Enterprise Development Agency.

BUSA. (2019). Strategic Focus: Small and medium business. [Online] Available at: https://busa.org.za/wp-content/uploads/2018/05/Small-Medium-Enterprises-Thriving.pdf [Accessed 20 Sep. 2019].

Buthelezi, T., Mtani, T. & Mncube, L. (2018). The extent of market concentration in South Africa’s product markets, Working Paper CC2018/05 Competition Commission.

Cant, M. & Stanford, C. (2006). Could the lack of formal or informal training be a possible reason for the low job creation in SMMEs in Davey ton and Soweto? Pretoria: UNISA.

DOI: 10.6007/IJARBSS/v4-i10/1255

Chikweche, T. & Mujeyi, K. (2015). Emerging models of inclusive growth: revisiting entrepreneurship and SMMEs in Zimbabwe. Beyond the Crises: Zimbabwe’s Prospects for Transformation, p. 283.

DOI: 10.5901/mjss.2013.v4n14p783

DOI: 10.15640/smq.v3n1a3

Chivasa, S. (2014). Entrepreneurship culture among SMEs in Zimbabwe: A case of Bulawayo SMEs. International Journal of Economics, Commerce, and Management, 2(9).

DOI: 10.15209/jbsge.v4i4.169

Deijl, C., de Kok, J. & Essen, V. (2013). Is small still beautiful? Literature review of recent empirical evidence on the contribution of SMEs to employment creation. Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH.

Dlova, M. (2017). Small, micro and medium enterprises access to credit in the Eastern Cape, South Africa, Doctoral dissertation.

du Plessis, G.(2016). The impact of retrenchment processes: Massive Retrenchments Do you have peace of mind, Solidarity Movement.

Dzansi, D. (2004). Social responsibility of SMMEs in rural communities, s.l.: Doctoral dissertation, University of Pretoria.

Edinburgh Group.(2012). Growing the global economy through SMEs, s.l.: Edinburgh Group.

Edmiston, K. (2012). The Role of Small and Large Businesses in Economic Development, Federal Reserve Bank Of Kansas City.

DOI: 10.22610/jebs.v10i1(J).2097

Enaifoghe, A.O. & Vezi-Magigaba, F.N. (2022). Rethinking The Sustainability Of Local Economic Development: Entrepreneurship In South Africa. Expert Journal of Business and Management. 10(2) pp. 77-90.

DOI: 10.51415/ajims.v5i1.1172

DOI: 10.20525/ijrbs.v12i4.2444

DOI: 10.1016/j.sciaf.2023.e01709

DOI: 10.1080/09718923.2012.11893048

DOI: 10.5901/mjss.2014.v5n16p100

Fjose, S., Grunfeld, L. & Green, C. (2010). SMEs and growth in Sub-Saharan Africa: Identifying SME roles and obstacles to SME growth, Oslo: MENON Publication No. 14/2010.

Gebremariam, G., Gebremedhin, T. & Jackson, R. (2004). The role of small business in economic growth and poverty alleviation in West Virginia: An empirical analysis. American Agricultural Economics Association Annual Meeting Denver Colorado, August.

Harris, G. (2018). More needs to be done. Fiscal Framework and Revenue Proposals - 2018 Presentation to the Standing Committee of Finance and the Select Committee of Finance, 212.

Hemson, D., Meyer, M. & Maphunye, K. (2004). Rural development: The provision of basic infrastructure services, s.l.: s.n.

Ijere, T. (2014). The State, Governance and Socioeconomic Development Realities in Nigeria. Public Policy and Administration Research, 4(1).

Kongolo, M. (2010). Job creation versus job shedding and the role of SMEs in economic development. African Journal of Business Management, 4(11), 2288-2295.

Kumah, O. & Omilola, B. (2014). Small Business Is Big Business A UNDP Perspective on SMME development in South Africa, UNDP South Africa.

DOI: 10.1002/csr.1366

DOI: 10.19030/jabr.v18i2.2115

DOI: 10.1080/09765239.2013.11884971

Mail & Guardian. (2010). The economic impact of Marikana. [Online] Available at: https://mg.co.za/article/2012-11-02-the-economic-impact-of-marikana [Accessed 30 January 2019].

Manuere, F. & Majoni, T. (2016). The concept of corporate social responsibility among SMEs in Zimbabwe. International Journal of Latest Research in Engineering and Technology, 2(2), 63-71.

Mbedzi, K. (2011). The role of government agencies in promoting SMME's in Limpopo: a critical assessment, Doctoral dissertation, Stellenbosch: University of Stellenbosch.

Mitchell, B. (2013). The Role of networks in mobilising capital in different ethnic groups in South Africa a mixed embeddedness approach to entrepreneurship, Barcelona: Doctoral Thesis Department of Business Economics Universitat Autonoma.

Mohedeen, N. (2019). Chamber president’s plans for hometown - Athlone News. [Online] Athlone News. Available at: https://www.athlonenews.co.za/news/chamber-presidents-plans-forhometown-20107848 [Accessed 19 Sep. 2019].

Nagaya, N. (2017). SME impact on output growth, a case study of India. Palma Journal, 16(13), 11-170.

Naudé, P. et al., (2018). Business Perspectives On The Steinhoff SAGA, University of Stellenbosch Business School.

Nhlapo, S., Nieuwenhuizen, C. & Ladzani, W. (2011). Government support and factors hindering small business survival in the Kroonstad area. Journal of Public Administration, 46(4), 1459-1478.

Oduntan, K. (2014). The role of small and medium enterprises in economic development: The Nigerian experience. International Conference on Arts, Economics and Management, pp. 75-78.

Otobo, E. (1997). Regulatory reform in support of privatization: Patterns and progress in Africa. African Journal of Public Administration and Management, 8(2), 25-50.

DOI: 10.1108/09513550410562266

Polity. (2018). Explosive report into VBS Bank reveals large-scale 'looting'. [Online] Available at: http://www.polity.org.za/article/explosive-report-into-vbs-bank-reveals-large-scalelooting-2018-10-10 [Accessed 30 01 2019]

DOI: 10.1057/palgrave.ejis.3000671

DOI: 10.1080/20421338.2017.1322749

Rashid, J. et al., (2017). Hero 6 Enterprise Development. Available online at http://www.wrseta.org.za/downloads/Syndicate%20-%20Hero.pdf

Raynard, P. & Forstater, M. (2002). Implications for Small and Medium Enterprises in Developing Countries, United Nations Industrial Development Organization.

Real Economy Bulletin. (2017). Special Edition: The State Of Small Business In South Africa. TIPS Publication, pp. 1-38.

DOI: 10.5901/mjss.2014.v5n4p59

DOI: 10.4102/ac.v18i1.591

Sanchez, D. (2011). The Economic Empowerment of African Descendents; lessons from South Africa’s Black Economic Empowerment Strategy. Paper presented at the Equity, Justice, Development: People of African Descendent in Latin America, Sephis and Universidad de Cartagena.

SBP Alert. (2014). Examining the challenges facing small businesses in South Africa. Business Environment Specialists Issue Paper 1.

SEDA. (2018). Small Enterprise Development Agency SMME Quarterly Update 1st Quarter 2018, Small Enterprise Development Agency.

Small Business Institute. (2019). The number of formal micro, small & medium businesses in South Africa Preliminary findings of stage 1 of the Baseline Study of Small Businesses in South Africa., Small Business Institute.

South African Human Rights Commission (2018). Equality Report 2017/2018: Achieving substantive economic equality through rights-based radical socio-economic transformation in South Africa, South African Human Rights Commission.

DOI: 10.5901/mjss.2013.v4n2p347

DOI: 10.4103/1817-7417.111015

Tustin, D. (2015). The physiognomy of SMMEs in South Africa and consequential national strategy reinforcement. The Retail and Marketing Review, 11(1), 77-91.

Urban, B. (2018). Entrepreneurship is on the agenda hype or real action. [Online] Available at: http://www.bbqonline.co.za/articles/entrepreneurship-is-on-the-agenda-again25323.html [Accessed 30 January 2019].

DOI: 10.4102/sajems.v6i3.3303

DOI: 10.17159/1727-3781/2017/v20i0a735

Waterhouse, B. (2019). The Small Business Myth Small businesses enjoy an iconic status in modern capitalism, but what do they really contribute to the economy?. [Online] Available at: https://aeon.co/essays/what-does-small-business-really-contribute-to-economic-growth [Accessed 30 January 2019].

Winter, S. (1995). Small and medium-size enterprises in economic development: possibilities for research and policy. Policy Research Working Paper The World Bank: Private Sector Division World Bank.

DOI: 10.17159/1727-3781/2017/v20i0a1687

Zeka, B. (2013). The influence of Business Social Responsibility on the brand image and business performance of Small and Medium-sized Enterprises, s.l.: Nelson Mandela Metropolitan University.