The Stanford Social Innovation Review states that there are 1.4 billion households around the world that live on less than $1.25 a day due to their inability to rise above the poverty cycle. This poverty cycle is a “systematic breakdown [that] excludes them from earning a reliable income.” Without a source of reliable income, these individuals are never able to improve their quality of life or the situation in their communities.
One solution to this problem is to spend large amounts of money on assistance programs based on rehabilitation and support, such as free health care. While these programs are often effective in improving access to basic necessities in regions that are severely affected by poverty – there are many questions about how feasible they are in the long-run. Without undermining the importance and success of such programs, it is a fair statement to make that despite these programs, there is still a strong need to find solutions to global poverty. It is this need that encourages us to look at assistance programs that focus on productivity and job development, rather than just satisfying basic necessities.
Opponents of such ‘modified’ assistance programs argue that the “ultra poor,” are often “too poor to work” because they simply aren’t ready to be productive. However, recent studies have proven that it is often productivity that can drive the revitalization and growth of individuals and communities. The increase in income that results from the introduction of job opportunities in poverty-stricken regions – can lead to better diets, more health clinics and access to more skills-training. As entire communities become more productive, local infrastructure improves and limited resources are used more effectively. To sum it up, Paul Polak, author of “Out of Poverty,” argues that the poor are poor because they don’t have enough ways of making money. By helping these individuals find ways to make money – they can rid themselves of poverty.
An example of this is the Equitas Bird’ Nest (EBM) program in the South Indian city of Chennai that provides subsidized housing and food to the city’s homeless population. A problem they originally faced was the fact that many of its potential participants relied on income from begging and did not want to move away from the high-traffic areas where they generated a majority of their slim earnings. By modifying their program to include the creation of new jobs that the participants could complete from their homes and the skills they needed to complete these tasks, the participants were able to almost double their household income in 18 months. In this case, it was productivity that allowed these individuals to transform their living conditions.
These modified assistance programs don’t have to be on a large-scale either. Another example is that of 49-year-old Nishhat Afza, an interior decorator in Mysore, India, who turned her hobby of making handicrafts into a social enterprise by conducting free training on embroidery, candle making, pottery and painting for women, physically-challenged and other poverty-stricken individuals.
While such social innovation ventures are still being developed and tested, they are beginning to prove effective. In an article in the Huffington Post, Auren Kaplan says it best: “Business is the most powerful force on the planet, in terms of its capability to move resources, money, and people.” By harnessing the power that business, and the job opportunities aligned with business have, we can help alleviate the burden that poverty has on individuals globally. Based on these case studies and a host of research that is currently being conducting, we conclude that the key to breaking the poverty cycle isn’t just monetary, but in fact, it is an opportunity that will help people transform their lives and their communities.