Push and pull factors in the initiation and maintenance of home work in two Pretoria settlements

Abstract

The interpretation of home -based enterprises by South African researchers has tended to be that they are invariable initiated when people lose formal employment and are ‘pushed’ into the informal sector involuntarily. In their ongoing functioning, home-based enterprises are also portrayed as marginal and vulnerable. Because of this interpretation, there has been a limited understanding of the role played by home -based enterprises in informal settlements, and in the national economy. The findings from a Pretoria case study suggest that around 80% of the people interviewed started businesses because they wanted to, and not because they had no oth er option. Many of these businesses were started because an opportunity was identified in the settlement. In other words, many people have been ‘pulled’ into such activity as a strategy both to improve earnings and to provide a service that is needed in the settlement. People’s reasons for entering the informal sector and the ongoing viability of their enterprises is discussed in this paper using evidence from qualitative interviews in two Mamelodi settlements (both sites and service and informal). Thirty people were sampled from the one hundred and fifty people who were interviewed in quantitative research. Four interviews will be referred to in detail, and key statistics used from the quantitative study. Thus the purpose of this paper is to re-examine some of the myths, and to establish the realities, of home -based enterprises in South Africa. The role of such enterprises at a settlement level and at a national level will be explored. The paper will conclude by examining what this altered view of home-base enterprises implies for policy makers and regulators trying to stimulate and support small, medium and micro enterprises (SMMEs).