Challenges faced by small, medium and micro enterprises in civil engineering projects at selected construction sites in the Free State

Abstract

Small, Medium, and Micro Enterprises (SMMEs) play a pivotal role in driving economic growth and fostering development globally, as well as in the specific context of South Africa. This importance is particularly evident in the civil, building, and mechanical engineering industries, where SMMEs contribute significantly to the country's Gross Domestic Product (GDP) and hold the potential to alleviate poverty, reduce unemployment, and promote inclusivity and fairness. This research explores the multifaceted significance of SMMEs in these industries. Globally, SMMEs are recognized as engines of economic growth due to their capacity to innovate, create jobs, and generate income. In South Africa, these enterprises have a profound impact on the economy, contributing poverty alleviation and income generation social inclusion. SMMEs involvement in the civil engineering, building construction, and mechanical engineering sectors are particularly crucial, as they drive infrastructure development, job creation, and skills enhancement as a future economic jack. The main goal of the study is to examine the difficulties SMMEs encounter due to broader economic trends, including the impact of unidentified household brand names that affect their cash flow and capital availability. The vital role of SMMEs in South Africa's GDP and poverty reduction is underscored by their potential to create employment opportunities, especially for marginalized communities, which finds expression in in the engineering and construction sector like many other economic sectors. These enterprises facilitate skills development and contribute to localized economic growth, thereby advancing inclusivity and social equity. However, SMMEs in the civil, building, and mechanical engineering industries confront an array of challenges, including limited access to financing, inadequate skills development, regulatory hurdles, and market access constraints. This empirical study identified the economic trends that influence capital cash-flow in SMMEs The research design that has been adopted for this study was a quantitative mono-method whereby a questionnaire was used as a singular data collection technique (Saunders et al., 2019:540). This linked well with the pragmatic paradigm which is a research approach that prioritizes practical outcomes and real-world applications over theoretical considerations. 130 SMMEs participants from the engineering sector were surveyed in the study. The study revealed that most private sectors are engaged in supporting the growth and mentoring of SMMEs. Additionally, the Free-State government provides financial support and facilitates marketing access to the SMMEs. The study recommends that the Free-State government should intensify programmes of skills knowledge development and marketing competition to maintain capital cash-flow sustainability in SMMEs.