What’s the Difference Between an Earn-it Project and a Social Enterprise?

Here at True Charity, we are big believers in challenge. You’ll hear different words for it—exchange, employment, reciprocity—but the basic idea is that, in order to do charity well, we must affirm the unique capacity of every human being. Many people living in chronic poverty wrestle with feelings of inadequacy or low self-worth. In order to attain healthy relationships and fulfilling jobs, most people need some intermediate stepping stones. Check out our curriculum database for classes that focus on strengthening relationships and social capital. 

Earn-it projects and social enterprises are two stepping stones on the path toward fulfilling work. Continuously handing out goods and services to people in need is unlikely to inspire them to exercise their own gifts and capacity.

There are many ways to create reciprocity and rid charity of the perpetual giver-receiver dynamic it so often embodies. Social enterprises, or businesses that meet social needs, provide innovative and sustainable solutions to individuals and communities. The earn-it model, employing individuals to meet their basic needs, also serves a crucial role in many people’s path out of poverty. So what is the difference, and why does it matter?

The most essential difference between these two forms of challenge is the needs of the individuals being employed. Many types of social enterprises exist but, in this article, we’ll focus on what Randy White, social enterprise consultant, referred to at the 2019 True Charity Summit as “integrated” enterprises—where “the activity of the business overlaps with its mission.” These businesses often focus on formal employment of people who struggle to get and keep jobs, such as individuals recovering from addiction, incarceration, prostitution, or poverty. Individuals employed by such enterprises have often just completed or are simultaneously working in some kind of rehabilitation program. Employees benefit from life skills training, mentorship, and help finding next steps for employment. 

Individuals who can commit to formal employment in a social enterprise have some kind of stability. Whether the individual has achieved independent housing and basic life skills, such as budgeting and grocery shopping on their own, or those components are externally supported by some kind of rehabilitation program, that employee is in a position to take a long-term job. 

Individuals who become “partners” in an earn-it project, though, are not formally employed, often due to an amount of instability in their lives. Partners work for short periods of time (often 30 minutes to a few hours) to earn basic needs, such as food, shelter, or a shower. These individuals are not in a temporary crisis, and therefore one-way giving, or relief would be unlikely to improve their situation. Rather, they are experiencing chronic poverty and need basic needs met on a short-term basis, but they also need encouragement to begin a path out of poverty. Individuals in need of earn-it style employment often live on the margins of society and may suffer from trauma, addiction, mental illness, or homelessness. 

Employing someone in bracelet-making or recycling for an hour allows the individual to retain his dignity and creates a context for a volunteer or staff member to engage him in meaningful conversation. Remember, though, the path of relief, rehabilitation, and development (which you can read more about here) is an upward trajectory. Individuals should always be moving toward a greater level of self-sufficiency. Partners who can become employed should be encouraged to use the earn-it project as a stepping stone to formal employment—perhaps a social enterprise might be a good fit. For some individuals who suffer from severe mental or physical disability, though, working hard to create beautiful items and forming relationships with other partners and volunteers is a fulfilling life. 

Social enterprises and earn-it models also vary in the way they operate economically. While it’s not true of every social enterprise, most of them act as businesses. They pay their workers with the revenue created by the product they sell. In order for a business to run effectively, an employee making $15 an hour must actually produce at least $15 worth of net revenue every hour on average. 

Earn-it projects, though, are not self-sustaining. Various factors such as addiction, trauma, or disability makes sustainable revenue production difficult for partners, yet they are still paid a market rate (or better) in the goods or services they receive. Because the main goal of the earn-it model is to retain dignity, not to create revenue, those projects may actually lose money.  

The best way to get a sense of the differences between social enterprises and earn-it models, and to see if either might fit your ministry well, is to research what other groups are already doing. Social enterprises like Klamath Works, Unshattered, and For Victory provide an essential step for people escaping cycles of brokenness. Earn-it models are less common, but Watered Gardens’ Worth Shop and Degage Ministries’ Degage Dollars program show that even those who might think they have nothing can still bring their unique gifts to the table.

If you think an earn-it model might serve your community well, check out our Earn-it Project Model Action Plan (MAP), which includes detailed guidance, practical tools, and informative videos to help you start your own project. If you haven’t joined the True Charity Network yet, you can see an overview of all of our MAPs here.