The Spanish Federation of Social Economy Enterprises (La Confederación Empresarial Española de la Economía Social – Cepes) has released a study which highlights how the sector’s values and principles contribute to society’s wellbeing.
The social economy includes co-operatives, mutuals, associations and foundations that are governed by a set of guiding principles, including the primacy of the individual and of the social purpose over capital.
To examine whether social economy enterprises behave differently from commercial enterprises and how their behaviour might affect society, the study compared 10,291 social economy entities (4,751 in the market or business sub-sector of the social economy) and 33,409 employed people (15,814 in the market social economy) with a control group of companies and jobs in a similar proportion.
In its third edition, the report is based on 2021 data from the Continuous Sample of Working Lives produced by Spain’s National Statistics Institute (Instituto Nacional de Estadística). The study was co-financed by Cepes, the Ministry of Labour and Social Economy and co-op banking group Cajamar.
The social economy in Spain boats more than 43,000 enterprises, 2.5 million jobs and a turnover of 10% of the Spanish GDP. Although the social economy is present in all economic sectors, this business model has a relevant weight in the care and other social services sector (where they account for 43% of businesses in this sector), in the culture and leisure sector (35.2%), in education (26%), in agriculture (12.8%) and in the energy and water sector (10.9%).
The report argues that the sector’s values and principles help it contribute through social and territorial cohesion through job creation and security, less salary dispersion and more equality within workplaces. The sector has a lower gender pay gap than commercial enterprises, with women earning 3% less than their male counterparts, as opposed to 26% in other enterprises. Furthermore, the report highlights that women earn 24% more in the social economy than in the commercial economy.
The sector also employs 181,000 workers belonging to groups with difficulty accessing employment, such as disabled people, and workers with low qualifications or over 55 years of age. These workers represent 7.7% of the total workforce of social economy entities, compared to 22.1% in commercial companies.
According to the report, these groups with the greatest difficulties in accessing employment receive almost €7bn annually in net salary income.
Another benefit they bring to society is helping to expand the private offer of care, education and water management services, argues the report.
The paper also mentions that social economy enterprises tend to be located in municipalities of less than 40,000 inhabitants, including rural areas, generating activity and employment, favouring the diversification of the economy whilst improving competitiveness in these areas. The sector provides 74,000 jobs in rural areas, which the report estimates, prevents around 192,000 people from moving to urban areas.
The report argues that these differentiating values and principles lead to a range of direct and indirect net benefits for society. It estimates the total benefits (direct and indirect) are worth Є11,023m annually, of which 46.9% is linked to the employment of groups with access difficulties to employment and 23.6% to greater employment stability.
The study also found that the prevalence of social economy enterprises varies by autonomous communities, with high levels of development in Ceuta, Melilla, Castile-La Mancha, Navarre, the Basque Country and Murcia and lower employment levels in the Community of Madrid, the Balearic Islands and the Canary Islands.
“The behaviour of social economy enterprises and organisations is different from the behaviour of commercial enterprises, and results in more inclusive economic growth, which provides greater stability and significantly reduces inequalities,” said Juan Antonio Pedreño, president of Cepes. “Moreover, they are companies with a strong commitment to the territory, which makes an important contribution to social cohesion and territorial cohesion.
“This study demonstrates the great weight of the social economy, both from an economic point of view due to its impact on employment, and from a social point of view due to its contribution to social and territorial cohesion, where it is often the only business actor that exists.”
