Government positions social economy as jobs delivery engine, not afterthought

South Africa’s Deputy Minister in the Presidency for Women, Youth and Persons with Disabilities, Mmapaseka Steve Letsike, used Thursday’s Catalyst Now South Africa Social and Solidarity Economy Symposium to lay out a concrete operational case for repositioning the social and solidarity economy as a primary delivery mechanism for jobs and inclusive growth, not a marginal supplement to the mainstream economy.

The symposium, conducted virtually under the theme “Building Inclusive Economies Through the Social and Solidarity Economy,” brought together government representatives, labour organisations, businesses, academics, civil society groups, social enterprises, cooperatives and community organisations. That breadth of participation reflected how widely the question of economic delivery is now being debated across institutional lines.

Letsike anchored her argument in the country’s structural inheritance. The legacies of colonialism and apartheid, she explained, had embedded patterns of dispossession, extraction and exclusion from productive assets that continue to shape inequality today. Constitutional democracy had dismantled discriminatory laws, expanded social protection and improved access to public services, but she was direct about what remained unfinished. “The persistence of unemployment, poverty, inequality and spatial exclusion does not diminish the Constitution,” she said. “It makes the urgency of its implementation even clearer.”

The institutional forms she identified as capable of doing that implementation work are cooperatives, mutual organisations, associations, community enterprises and qualifying social-purpose businesses. These entities, she noted, conduct genuine economic activity while prioritising collective benefit, social purpose and democratic participation over unrestricted profit. She was equally direct about what the sector cannot be allowed to become. “It cannot become cheap outsourcing of public responsibilities, nor can social purpose excuse poor governance or exploitation.”

The employment data driving that urgency is stark. In the second quarter of 2026, 8.5 million South Africans were officially unemployed, a rate of 33.6%. Youth unemployment had climbed to 47.4%. Women faced an unemployment rate of 37.5%, more than seven percentage points above men. Economic growth of 0.5% in the first quarter had not generated inclusion at the required scale. Letsike put the political stakes plainly: the country cannot expect young people to embrace political freedom while nearly half of those seeking work remain jobless.

Government programmes have created entry points. The Presidential Employment Stimulus has generated more than 2.5 million work and livelihood opportunities, predominantly for young people and women. The Social Employment Fund represents another pathway. But Letsike identified the critical delivery gap: converting those temporary opportunities into bridges toward accredited skills, permanent employment, cooperative ownership, community enterprises and sustainable contracts. Creating the entry point is not the same as building the pathway.

By contrast, the structural obstacle blocking that conversion is what she described as a broader and more complex version of the “missing middle.” Traditionally understood as the gap between micro-grants and commercial lending, the problem extends further. Community enterprises and cooperatives struggle to access appropriate finance, markets, contracts and institutional support simultaneously. Women-led enterprises illustrate the bottleneck precisely: they may have demand and operational experience but lack collateral, audited financial statements or the capacity to compete for large tenders.

A recent assessment found 117 public mechanisms for financing micro, small and medium enterprises, administered across 26 separate institutions. That fragmentation is itself a delivery failure. Rather than adding to it, Letsike called for simplification of access, diversification of financial instruments and stronger connections between finance, capability development and market opportunity. The task she described is not programme creation but infrastructure rationalisation, making what already exists more navigable and more responsive to the enterprises and cooperatives trying to use it.

Whether the 26 institutions administering those 117 mechanisms can be coordinated into something coherent, and on what timeline, remains the open question that Thursday’s symposium did not resolve.