Growth Scenarios for Economic Development of Small Business in the Republic of South Africa

By Venter, P. F. | Academy of Entrepreneurship Journal, Fall 1995 | Go to article overview
Save to active project

Growth Scenarios for Economic Development of Small Business in the Republic of South Africa

Venter, P. F., Academy of Entrepreneurship Journal


Urban development and transportation of goods and services are directly related to the extent of economic development. The Business Economic plan should address the development potential of the different economic activities and make predictions for future growth. This implies that the objectives of the Business Economic Research Plan are:

To place Business Economic development in perspective;

To interpret the growth potential of the different Business Economic sectors;

To generate inputs as required for land-use and transport planning; and,

To address important development aspects, growth potential and development guidelines.

The research was based on the information and planning parameters available during the study period. Utmost care has been taken to access the most relevant up-to-date information. The information used in the analysis of the Business Economic status of the study area was obtained from various sources. A list of these sources is provided in the references.


The time frame adopted for the Business Economic and Urban Structure Plan was seventeen years, stretching from 1993 to the year 2010. The ages of potential members of the labor force in the Vaal Triangle and Northern Free State average between 15 and 64 years. It represents 66,6% of the total population in the study area. Table 1 displays a breakdown of the population labor force.

Compared with the national average of 66.1%, it is clear that the study area compares favorably in this respect. Of these, 458,161 are economically active and represent the labor supply of the study area. The term economically active in this instance refers to all workers in the study area, whether employers, employees, self-employed or unemployed, and commuters residing in the area (Central Statistical Services, 1993).

Estimates show that unemployment in the study area is 149,335 (13.5%) of the total population (see Table 1) or 32.6% of the economically active population. According to Table 1, the labor supply can be categorized as follows:

Employed in the formal economy of study area:     44.8%
Employed in informal activities of study area:    12.2%
Employed outside the study area:                  10.4%
Unemployed:                                       32.5%

The Vaal Triangle and Northern Free State has a specialized economy which is dominated by a few large industrial enterprises employing 38% of the active labor force A more diversified Business Economic base would reduce the study area's dependence on the strong influence of the chemical, iron, steel and related industries and would spread the risk over a broader economic base. The lack of economic development in these areas is a major constraining factor, for large markets exist without supportive economic development (Development Bank of Southern Africa, 1991).

There are 7,313 formal businesses in the study area with a total employment of 205,401 (Table 2). Most of these employment opportunities (77,726) are created by industrial enterprises representing 92% of all the formal businesses in the study area (Vanderbijlpark Town Council, 1993). The second largest demand for employment is created by the wholesale and retail trade sector. This sector offers 45,330 employment opportunities and it represents 46.7% of the businesses in the study area. Together these two sectors are responsible for more than 59% of all the formal job opportunities by almost 56% of the enterprises.


The functional specialisation in the study area refers to those urban functions and economic activities in which a particular urban area specialises. In terms of all urban functions in the Vaal Triangle and Northern Free State, each urban area provides for the lower order needs of its inhabitants but also specialises in the provision of a particular higher order function, such as specific services, business economic activities, recreation or accommodation (Vaal Triangle Regional Services Council, 1993).

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
Loading One moment ...
Project items
Cite this article

Cited article

Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited article

Growth Scenarios for Economic Development of Small Business in the Republic of South Africa


Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

While we understand printed pages are helpful to our users, this limitation is necessary to help protect our publishers' copyrighted material and prevent its unlawful distribution. We are sorry for any inconvenience.
Full screen

matching results for page

Cited passage

Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.

Are you sure you want to delete this highlight?