A Social Economy at the Service of Job Creation for the Most Vulnerable: The Role of Social Enterprises in the Job Creation Agenda

World Bank, Alina Nona Petric and Niels Planel

No 213147, The Social Policy and Labor Discussion Paper Series from The World Bank

Abstract: This report highlights the urgent need to create jobs for the world's most vulnerable populations and argues that the social economy—comprising cooperatives, mutual societies, associations, foundations, and especially social enterprises—offers a powerful solution to this challenge. Social enterprises stand out by combining social objectives with market-based operations, reinvesting surpluses to achieve social goals rather than maximizing profit. Their local focus and adaptability allow them to address barriers such as limited mobility, inadequate childcare, and low skill levels, making them effective at generating private-sector jobs for marginalized groups where traditional businesses often fail. The report underscores that inclusive growth requires targeted, community-level interventions, and that social enterprises are uniquely positioned to innovate and drive sustainable, equitable development. Drawing on case studies from Austria, Belgium, France, Romania, Slovakia, and Türkiye, the report demonstrates how integrated support for social economy actors—through technical assistance, policy development, financing, and Communities of Practice (CoPs)—can strengthen local ecosystems and expand inclusive job creation. The report recommends prioritizing distributed growth by supporting a plurality of locally embedded social enterprises, integrating funding that accounts for positive exter nalities, reducing fragmentation through systemic frameworks, institutionalizing CoPs, and deploying complementary, localized job matching platforms. These strategies are essential for scaling the social economy and achieving sustainable, inclusive employment outcomes.

Date: 2026-07-30
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