The impact of small, micro and medium enterprises (SMMESs) on poverty alleviation through employment creation : a case study of the tourism services sector in the township of Umlazi, Durban.

Abstract

Poverty alleviation through employment creation is the focus of the South African government and other developing economies. The SMME sector has been identified as the leading vehicle for the creation of employment opportunities. South Africa in particular went through a phase when economic growth did not translate into employment creation. Consequently the benefits of economic growth did not filter through to the unemployed. In South Africa there is a strong link between unemployment and poverty. Essentially the country experienced jobless growth and it is the poor who missed out on the possible benefits of economic growth. The challenge then for South Africa is to come up with a revolutionary approach to ensure that the country's poor are not excluded from the of benefits economic growth. Almost half of the South African population lives in poverty. Poverty and the consequences thereof are most pronounced among the African population. This is due to the South African history of apartheid which systematically excluded them from accessing economic opportunities. Bringing development to communities is the thinking behind local economic development (LED). The urgency for the country to address poverty lies in the fact that poverty is not a static phenomenon and if left unaddressed it may to lead more people being poor when the numbers are already overwhelming. Government has come up with various strategies for poverty alleviation, employment creation being the chief strategy. The SMME sector is the most prominent employer in South Africa, said to be responsible for over 61 % of all employment. Even given these figures of there are still high levels of unemployment in the country. Growing industries like the tourism sector present a lot of hope for the ambitions of employment creation and poverty alleviation in developing countries including South Africa. The focus of this study will be the South African tourism sector.