A social firm is a specialist social enterprise that focuses on employing or increasing employment chances for job-disadvantaged people.
Social firms divide into two types: employment social firms, and employability social firms.
An employment social firm creates jobs. It is a social enterprise that trades in the open market and has a social mission of recruiting at least 25% of its employees from people facing major barriers to work. It earns at least 50% of its income through the sale of its products or services. The profits are not distributed to shareholders, but are reinvested in the business for growth and to create more jobs.
An employability social firm improves the employment prospects of job-disadvantaged people though a wide range of work-based opportunities. These might be work experience, training or coaching to help people become job-ready. It often finds its employees from people who have come through its own development processes, therefore being both an employment and an employability social firm.
Many social firms offer a mix of job-training and jobs, so it is possible to be an employment and an employability social firm at the same time.