Small and Medium Enterprises (SMEs) Strategy for Job Creation in the Era of Unemployment Crises: A Qualitative Study of Kamhlushwa Township, Mpumalanga Province

Abstract

Unemployment is a devastating development challenge in South Africa. In an attempt to address unemployment, the South African government supports diverse economic growth strategies, one of which is the small and medium enterprise (SME) strategy. While the role of SMEs in economic growth is increasingly recognised, there is no conclusive evidence on the contribution of SMEs towards job creation in townships. This article analyses the contribution of SMEs towards job creation in Kamhlushwa township. Ten face-to-face semi-structured interviews were conducted with SME owners in Kamhlushwa township to elicit data. The results indicate that the SMEs’ contribution to job creation varies across sectors, with the agricultural sector making the largest contribution. The results also indicate that there are factors enabling SMEs to create jobs, which include the availability of resources, high demand for products or services, and quality of infrastructural development. Conversely, the results demonstrate that there are factors impeding the SMEs from creating jobs, which include a lack of resources, poor municipal service delivery, and cost of distribution and transportation. This study recommends more government support targeting township SMEs to enhance their contribution to job creation.