Improving lives through community business

The COVID-19 crisis exposed how unequal the UK is. It lifted the veil on poor working conditions and job insecurity across many parts of the economy. It revealed the huge health differences between the best and the worst-off in society, and made visible the number of people already experiencing loneliness or social isolation, all of which was worsened by the subsequent lockdown.

Many of us were shocked to see the mess the economy and social contract was in. Many of us also promised that once lockdown was lifted, things have got to change. But how can such changes happen? And what do these changes look like?

At Power to Change we witnessed how communities led the way in responding to the crisis and supporting each other where other institutions had previously failed. Many community businesses played a key role in brokering and facilitating local responses. We believe that going forward, community businesses have an even more important role to play in a just and fair economy and social contract.

Our latest research report brings together our evidence base about the impact of community businesses on the people they work with and support. This report is not just about the response to COVID-19, but it shows how community businesses are well placed to support communities respond to the effects of the COVID-19 crisis in a number of ways.

Community business is for everyone

The work of community businesses, their staff and volunteers creates, nurtures and sustains relationships locally. It builds trust and reciprocity. It builds social capital, the glue that holds communities together. This is because community businesses work with and support a diverse group of people: the customers for their goods and services, the wider group of beneficiaries that the business was created to support, the staff they employ and the volunteers they engage, as well as their members, supporters and their shareholders. There is no ‘one size fits all’ approach to community business, and they are open to all.

As a result of this, community businesses have many impacts. These are often bespoke to their local area and the challenges residents face. Yet they have notable impacts on people’s lives in several common ways

Community business reduces social isolation

Prior to the pandemic, social isolation and loneliness affected more than nine million people and cost the UK economy £2.5 billion a year in lost productivity and staff turnover. It was a largely hidden phenomena exposed and worsened by lockdown.

Most community businesses (85 per cent) tackle social isolation. Most are founded by local residents who come together over a shared cause or challenge. As such, they are highly relational and person-centred organisations. This plays a key role in their social impact. Community businesses provide a safe and welcoming environment for people to enjoy and meet others. This might be through providing volunteering opportunities, targeted activities or a space to access services or learn new skills. It can even simply be through providing a space to sit and have a chat. Even with social distancing restrictions, this points to a better way of running local businesses and spaces than the atomised system which existed before the crisis.

Community business improves health and wellbeing

People living in the most deprived areas of the UK spend around a third of their lives in poor health, twice the proportion spent by those in the least deprived areas. Added to this, mental health problems in the UK workforce cost employers almost £35 billion last year.

A third of community businesses work with people with physical or mental health conditions. They support them to progress their personal lives and develop valuable relationships with others. This contributes to other positive health and social care outcomes. They improve individual’s confidence and wellbeing and also support community-level improvements, such as increasing community involvement and enhancing social relations.

Community business improves the local environment

Community businesses also productively use buildings and green spaces to improve local areas.

Community-owned spaces contribute £220 million to the UK economy, and 56p of every £1 they spend stays in the local economy. Community and public ownership of high streets also leads to fewer empty units.

Community business provides better access to services

Community businesses provide much needed social infrastructure. Many start after residents discover their only shop, pub, post office or other local facility is closing. Many then becomes a ‘one-stop shop’ or ‘community hub’ providing crucial services, often over and above ‘basic’ provision, in response to community needs and wants.

Community business improves employability

Nearly two-thirds of people in poverty live in a family where someone works. For many, work doesn’t pay.

Community businesses support people facing exclusion from employment and/or challenges with their physical or mental health. They already provide stable employment for 33,900 people in the most deprived areas of England, and most jobs go to local people. Many community businesses are supporting the Real Living Wage and provide good working conditions. They also support local people to gain qualifications. Put short, community business improves employability.

This provides cause for optimism as the economic impacts of COVID-19 take hold. Community businesses are already working within communities most likely to be hardest hit. And they have already shown they can engage those traditionally excluded or furthest away from the labour market, and provide them with good work. So when we think back to the promises we made to ourselves and each other, about how things have got to change, we now know were right. Things have got to change. And community businesses must have a key role to play if we are to build back better.

Read the full report here.

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