How big is the social economy?

George Clark (Oct 2003)

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The social economy in Scotland is driven by 44,000 voluntary organisations. 22,000 of these are registered charities. The sector employs about 100,000 people (80,000 full time) and is supported by 700,000 volunteers.

In 2000 income to the social economy was estimated to be Ł2.2 billion which is 4% of Scotland's gross domestic product. This includes charitable funding by individuals of Ł370 million per year with another Ł90 million coming from charitable trusts.

And the social economy sector is growing. Since 1995 the paid labour force has nearly doubled and the income has increased by 40%.

"Social economy organizations working with socially disadvantaged groups spend around Ł500 million each year of self-generated income and income from private donors and charitable trusts, a sum which probably exceeds the annual total of the Executive's dedicated social inclusion expenditure." (p20) Ref: Scot Exec.

How are social economy organisations different from public and private sector ones?

Social economy organisations are different from other organisations because they

are set up for a social and environmental purposes (not just to make profit)

have unpaid, leadership (ie Board members, Directors or Trustees)

have a lot of community or user involvement in how they are run

reinvest profit rather than paying it out to shareholders

Social economy organisations have many advantages compared to other organisations. They are:

close to their customers and clients and therefore know and respond quickly to their needs

able to provide services to groups of people that are hard to reach

independent of the state and therefore free to experiment and do things differently

able to attract charitable donations (money, labour and contributions in kind)

well placed to make experience based contributions to public debates

an effective way of building social capital (see box)

How can social capital be developed?

	build the capacity of communities to determine and act on their own definitions of the public good
	provide ways for taking independent social action
	create networks of communication and decision taking in communities of place and interest
	develop neglected human skills
	locate a social economy organization within a community
	create employment and encourage new economic activity

Ref: p11 Scot Exec

What do social economy organisations do?

There are many types of social economy organisations doing many different things. Some are small, low budget organisations with a very local focus while others are large, big budget organizations with national and/or international influence.

They may be linked to public or private sector companies on a more or less formal contract basis or they may be totally independent. They may or may not be registered charities and/or companies limited by guarantee. They range from corporate firms such as mutuals, employee owned businesses and cooperatives through housing associations and campaigning groups to small, self-help community groups.

What themes are covered by social economy organisations in Scotland?

	animal welfare
	arts and museums
	children's services
	civil rights
	community care
	community regeneration
	conservation
	cultural heritage
	education and vocational training
	environment
	energy efficiency
	fair trade
	financial services
	food processing
	health
	housing
	information communication technology
	land industries: horticulture, agriculture & forestry
	legal services
	local exchange trading
	marine industries: fisheries
	micro-finance credit
	overseas development
	religious activities
	research & policy engagement
	recycling and waste reduction
	retail distribution and shops
	rural development
	savings and credit
	social banking
	social landownership
	small scale power utilities
	sports and recreation
	sports hunting and fishing
	transport
	tourism - local & green