Microbusiness Tools

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HOW TO START AND RUN Series

Dear Colleagues in Community Action,

Every ten or fifteen years we have to reinvent ourselves. It is that time again. We can invest new resources (a) in giving people a certain level of comfort by feeding the consumption side of their lives, or (b) in expanding the ways people can get money in this harsh new economy. I am focusing on the second approach. Existing employment and training and economic development methods work for some people, but more strategies are needed.

THE FIRST STRATEGY flows from the globalization of the economy and the effects of new technology. Downsizing and de-layering are a long-term trend. "Good" jobs disappear. The Myth is that there is a good job with benefits for anybody who will work hard. This may or may not have been true in the past, but it is not true any more. More and more people will be working in low- paying jobs with no benefits or will be self-employed-- whether they want to be or not. It is time to invest more in strategies to help people deal with this ugly reality. The demonstration partnership program (DPP) microbusiness evaluations said that as many as 20% of low-income people can be self-employed, and that over half of them will earn enough to make it worth doing. People "patch" together several sources of income trying to make ends meet. Most start out working from home, in the informal economy. Most of these businesses will start with NO loan. The person invests their time for several weeks to test the marketplace to see if their product or service will sell. If the idea is viable, it begins to produce some cash-flow to the person and/or to the sponsoring organization (profit making for nonprofits). THEN they organize it in a more formal way. So one strategy is to help more people increase their income by helping them start home-based businesses. Six growth sectors are: (1) in-home child care; (2) lawn care and gardening; (3) small-scale retail through booths, carts and kiosks; including farmers markets and other public markets (4) resale shops of several types; and (5) specialty food preparation, and (6) the microbusiness training and technical assistance programs that help people get into these businesses. In each of these areas, I am producing "how to" information .

THE SECOND STRATEGY comes from the fact that there are not enough jobs for people who want to work now, and the fantasy that hundreds of thousands of people will move off of the welfare rolls in two years or five years into jobs in the private sector is absurd. Many of these folks will crash and burn, and I hope you document the personal disasters and raise hell through your advocacy work. But the social value that people have a right to income maintenance has changed to one that requires "work" in exchange for money, so eventually the states will seek new ways for people to "work" or to do something (community improvement?) that validates receiving money in exchange for it. Perhaps people will do socially useful work such as child care, environmental clean-up, or work at the park or the county fair. Some employers will get the money from TANF and a person will receive that money in the form of a paycheck. You may be that employer! This strategy is going to take awhile to evolve, but by starting a development process now we can help define these new ways that people will get money.

These two strategies overlap. We should create connections and synergy between them. Maybe your organization will "hire" a thousand people to do this yet-to-be-defined "work" in these new types of "jobs." I want to help invent this new work. Let me know if you are interested in being involved.