The Contribution of Group- Based Micro and Small Enterprises in Employment Creation and Income Generation: Evidence from Woreda Fourteen of Kolfe Keranio Sub-City, Addis Ababa, Ethiopia

Abstract

The main objective of this study is to investigate the Contribution of Group-Based MSEs (construction, manufacturing and service enterprises) to employment creation and income generation in the Woreda 14, Kolfe keranio Sub city. Unemployment and low income are one of the present situations in urban and cities of Ethiopia. The government of Ethiopia has formulated a policy to mitigate the overwhelmed problem by fostering micro and small enterprises. During the study, primary data were collected from 80 owners and 76 employees of MSEs’. In addition, secondary data were collected from Woreda 14 MSEDO, Kolfe keranio Sub city MSEDO, and Addis Ababa MSE Development Bureau. Both quantitative and qualitative approaches were applied to analyze data. The finding of the study shows that the enterprises provide income and employment opportunities. It provides annual average of minimum 5-7 and maximum 17-23 employment opportunities in the last five the years. The annual average income of the enterprises was at the minimum ranging between 30,000-50,000Birr and maximum ranging between 141,001-200,000 Birr. However, the roles of micro and small scale enterprises have been left unexploited in providing income and employment due to lack of working place, insufficiency of finance or credit facility and like. Thus, the government and other concerning bodies should modernize working procedure, promoting micro finance institutions and provide working premises in the appropriate place in order to boost the influence of micro and small enterprises in generating income and employment opportunities for the people.

Keywords: Micro Enterprise, Small Enterprise, Manufacturing, Construction and Service Sector

DOI: 10.7176/JAAS/55-02

Publication date:May 31^st 2019