The scope and extent of home-based business income relative to employment earnings in financing household expenditures: a study undertaken in a subeconomic housing area within the Cape Metropole

Abstract

This study was undertaken to examine the scope of home-based businesses in poor neighbourhoods and the extent to which household income is derived from them. The aim was to determine the ratio of home-based business income to wage earnings, in order to understand its relative importance in augmenting primary employment (wage-based) income. The size, necessity and importance of self-generated (business-derived) income in augmenting primary income was measured in a selected subeconomic housing area within the Cape Metropole. The significance of this analytical research is the determination of income data and the levels of poverty. This paper provides the primary data (base information) for policy formulation relating to social and economic development in this subeconomic area. The findings add to the debate for the provision of a Basic Income Allowance (grant) for those people experiencing poverty. The results correlate with findings of national longitudinal studies. The level of job creation through businesses is minimal and the extent of unemployment is much greater than anticipated.